No To Retro Tax – Campaign Against Section 58 Finance Act 2008

[nevergiveup]

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In my case bankruptcy is totally certain. As is my next nervous breakdown. Nice to have some good news - cheers.

Good NTRT newsletter. We are still fighting on several fronts and we haven't lost yet remember!

[Henrik]

top post

In my case bankruptcy is totally certain. As is my next nervous breakdown. Nice to have some good news - cheers.

This is very interesting. I am exactly the same position and bankruptcy will end my ability to work in financial services and force the end of my limited company - further information on this would be very useful. Particularly around whether HMRC would actually have Decree/Judgement against us - which means we fail a credit check. Obviously I want to stall bankruptcy as long as possible as I don't feel like retiring quite yet.

[swede]

This is very interesting. I am exactly the same position and bankruptcy will end my ability to work in financial services and force the end of my limited company - further information on this would be very useful. Particularly around whether HMRC would actually have Decree/Judgement against us - which means we fail a credit check. Obviously I want to stall bankruptcy as long as possible as I don't feel like retiring quite yet.

Same here. It will be a calamitous career ending event.

It's ironic, but by being made bankrupt, I won't be able to pay back anywhere near as much as if I was able to carry on working and able to agree a payment schedule with them. So in some perverted way, the fact that HMRC would get pretty much "stuff all" from me if the worst was to happen, at least will give me some miniscule sense of satisfaction - however painful it might be to me and my family.

[BrilloPad]

Same here. It will be a calamitous career ending event.

It's ironic, but by being made bankrupt, I won't be able to pay back anywhere near as much as if I was able to carry on working and able to agree a payment schedule with them. So in some perverted way, the fact that HMRC would get pretty much "stuff all" from me if the worst was to happen, at least will give me some miniscule sense of satisfaction - however painful it might be to me and my family.

Brannigan has let his personal feeling regarding Gittins get the better of him. Gittins is in Barbados and cannot be touched - we are the only target left.

[Alba]

Yet another vendetta,

Brannigan has let his personal feeling regarding Gittins get the better of him. Gittins is in Barbados and cannot be touched - we are the only target left.

An MP accused HMRC last week in a parliamentary debate of pursuing a “disgraceful vendetta” and called into question the professional competence and integrity of Louise Brittain, a high profile insolvency practitioner appointed at a company in his constituency in 2009.

In response to the allegations, Brittain said Conservative MP for Bromley and Chislehurst Robert Neil had failed to investigate all the aspects of the case when he used parliamentary privilege to air the directors' grievances.

Neil raised the case of Abbey Forwarding in an adjournment debate on Friday 17 January. A bonded warehouse company based in East London, Abbey was closed down in 2009 after HMRC raised assessments for nearly £6m in excise duty after claiming 301 shipments of tax-exempt alcohol had been diverted for resale in the UK.

By precipitating a provisional liquidation process, HMRC prevented the company directors from appealing appeal against the assessments. Deloitte’s Louise Brittain was appointed liquidator at an ex parte hearing from which the Abbey Forwarding directors had been barred and embarked on a “fire sale” of the company’s assets. With the connivance of HMRC, the liquidator “deliberately sought to shut them out from pursuing any avenue of appeal against those assessments”, the MP alleged.

When HMRC pursued civil proceedings against the directors in July 2010, the judge found there were only three diversions and dismissed the case. The judge said that as a result of the hundredfold exaggeration the HMRC case “crumbled to dust”.

The MP claimed Brittain had been aware of the exaggeration throughout the 12-day trial, during which she gave evidence, but did not seek to correct the misleading information.

“She was thoroughly criticised by the judge, and rightly so. She consequently left Deloitte and no longer practises independently without supervision,” Neil said. “Frankly, she should never be appointed as a liquidator again, because that ineptitude led to serious injustice for my constituents.”

Brittain left Deloitte in December 2013 and joined top 25 firm Wilkins Kennedy as a partner. The ICAEW confirmed she had been licensed as an affililate for insolvency with ICAEW, but did not renew her insolvency licence with the institute.

Brittain, who has maintained a high media profile during her career so far, remains a member of the national council of the insolvency body R3 and is registered with the Insolvency Practitioners Association (IPA). She told AccountingWEB that Deloitte's policy was for its IPs to be registered with the ICAEW and that Wilkins Kennedy prefers its practitioners to register with the IPA.

“It's a shame [Robert Neil MP] didn't come and talk to me,” Brittain said. “I specialise in contentious insolvency and deal with people in difficult situations like this. It's a difficult case. From my perspective the frustrating thing is the inaccuracies and incorrect information being put out.

While HMRC lost the civil proceedings against the Abbey Forwarding directors, their subsequent £1m+ aggravated damages claim failed, leaving them with a substantial legal bill.

“At the end of the day, they brought litigation that failed. There's a lot more to this than meets the eye,” Brittain said.

Turning his attention to policy and governance issues, the Bromley & Chislehurst MP questioned HMRC’s practice of using civil proceedings - where the burden of proof is lower - to pursue allegations of tax evasion.

“Great care must be taken with the governance of this procedure, as HMRC can end up as judge, jury and executioner,” Neil said.

As treasury minister David Gauke explained in his response, provisional liquidation allows a winding-up petition to be presented without notice to the company concerned. HMRC uses it very rarely - 13 times since 2009 - in fraud cases where the delays involved in a normal liquidation process would give fraudsters the opportunity to destroy evidence and cover their tracks.

“I am informed by HMRC that it considers that the 13 actions have prevented Exchequer loss of at least £150m,” Gauke said. “I would not therefore wish HMRC to restrict its use of provisional liquidations in appropriate circumstances.”

Neil had pressed the minister for a full investigation and for HMRC managers to admit that what they had done was wrong in what he called a “litigious war of attrition against the directors” that included trying to obstruct them from gaining a new licence to rebuild their business.

He pointed out that the High Court judge had acknowledged there was a strong case for injustice having been done and that HMRC had not appealed his decision. The MP also argued that giving Brittain indemnity from her legal costs and any potential damages was “a very questionable use of public money”.

The MP was concerned by HMRC’s “unwillingness” to engage realistically with the company directors and their MPs, and viewed this as evidence of complacency among HMRC’s senior management.

“It is almost as though they said, ‘We will not admit that we were wrong. We have deeper pockets than they do. We will put them out of business, in effect, and hope that they go away,’” the MP said.

Neil demanded that he and other MPs be informed of changes in governance arrangements around such cases to ensure that lessons that have been learned. “I also hope that the minister will prevail on those responsible to say that if an error has been made, the best thing to do is to recognise that lessons have been learned, apologise, and move on. None of that has happened so far.”

The Abbey Forwarding directors have reportedly brought a ruination case against HMRC, although Brittain said she was not aware of any proceedings.

While the case has now been raised in parliament, David Gauke declined to make any references to the individual taxpayer and added that HMRC will not conclude its internal investigation until the outstanding litigation has been resolved.

[Cantthinkof1]

Latest NTRT newsletter...

First of all, many thanks DR for your reply via private message.

I read the latest NTRT newsletter and thought it made some interesting reading.
Personally I still live in hope that one solution will be a SENSIBLE agreement with HMRC (whatever SENSIBLE may be!) and that we can finally go back to living a "normal life".
Sadly this has been hanging over my head for too many years now, although I am totally aware that I am just one of a vast number of people in the same boat!
Although I appreciate that NTRT negotiations with HMRC are a very sensitive issue, it would be nice to know whether this really is a realistic option?

[smalldog]

Same here. It will be a calamitous career ending event.

It's ironic, but by being made bankrupt, I won't be able to pay back anywhere near as much as if I was able to carry on working and able to agree a payment schedule with them. So in some perverted way, the fact that HMRC would get pretty much "stuff all" from me if the worst was to happen, at least will give me some miniscule sense of satisfaction - however painful it might be to me and my family.

Horizon event in my view. But for some reason HMRC continue to suggest we pay up, they just dont listen, or believe it to be true.

[smalldog]

First of all, many thanks DR for your reply via private message.

I read the latest NTRT newsletter and thought it made some interesting reading.
Personally I still live in hope that one solution will be a SENSIBLE agreement with HMRC (whatever SENSIBLE may be!) and that we can finally go back to living a "normal life".
Sadly this has been hanging over my head for too many years now, although I am totally aware that I am just one of a vast number of people in the same boat!
Although I appreciate that NTRT negotiations with HMRC are a very sensitive issue, it would be nice to know whether this really is a realistic option?

Hi, I think the only real sensible option to conclude this for all sides would be for an agreement that tax is payable but without punitive interest.

Then HMRC get their money, Govt dont have to back down and a lot of people (I suspect) would be in a better position to pay it off without their world being destroyed, because as we are all very very aware, interest is now circa 50% of the liability! For me personally interest is the difference between me being able to pay or not.

I wouldnt be at all surprised if FTT or higher reach this as a final conclusion to settle the whole thing.

[normalbloke]

Fight on...!

Hi, I think the only real sensible option to conclude this for all sides would be for an agreement that tax is payable but without punitive interest.

Then HMRC get their money, Govt dont have to back down and a lot of people (I suspect) would be in a better position to pay it off without their world being destroyed, because as we are all very very aware, interest is now circa 50% of the liability! For me personally interest is the difference between me being able to pay or not.

I wouldnt be at all surprised if FTT or higher reach this as a final conclusion to settle the whole thing.

I wouldn't associate HMRC with the word 'sensible' in any context. 'Bullying' and 'vindictive' are much truer. I for one wouldn't want to be part of ANY settlement unless it was truly the last resort. I don't believe it's HMRC's money 'to get'.

The 'sensible' options went out years ago when HMRC didn't take us to the FTT based on the law as it stood at the time, or closed the legal loophole going forward.

[smalldog]

I wouldn't associate HMRC with the word 'sensible' in any context. 'Bullying' and 'vindictive' are much truer. I for one wouldn't want to be part of ANY settlement unless it was truly the last resort. I don't believe it's HMRC's money 'to get'.

The 'sensible' options went out years ago when HMRC didn't take us to the FTT based on the law as it stood at the time, or closed the legal loophole going forward.

trust me I hear you, were all on the same page in terms of our views over HMRC behaviours. I just feel it could end up going this way and if it did, might cause less collateral damage.