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

[smalldog]

My understanding is the rules come into force in 2016 and it doesn’t affect us as it’s aimed at evasion / non-disclosure.

not true according to the BBC website:

BBC News - Autumn Statement: Bid to recoup £9bn in unpaid tax

If you have used a marketed avoidance scheme which HM Revenue and Custom (HMRC) believes to be ineffective, they will challenge the scheme in the courts.

Usually one or two cases are selected as test cases and take several years to go through the courts. The rest - called "followers" by HMRC - sit and wait to see what happens. During this time, followers normally retain the benefit of the tax saving, and HMRC have to recover the money later if they win in the courts.

ew rules are expected to make two changes. Firstly, if the scheme is defeated at any stage in the courts, followers will be asked to concede their case. If they do not, because they hope the test case will succeed on appeal, they will be charged a penalty if the test case is eventually lost on the same point of law.

Secondly, once HMRC have won in the courts, the followers who do not concede will have to pay over the tax which has been avoided, even though the test case itself appeals to a higher court.

The government will also consult on whether to tighten these rules further, to prevent those using tax avoidance arrangements gaining a cash-flow advantage while it is under challenge.

[Taffia]

Erm, just received another letter from Montpelier today. 2 in one month is a shocker!

This one kind of put the fear of death into me because it's all about the need to disclose things to HMRC.

Haven't we already done this via our self assessment tax returns or am I missing the point?

Haven't received the first one from the other day yet. Anyone else?

[redkieran]

not true according to the BBC website:

BBC News - Autumn Statement: Bid to recoup £9bn in unpaid tax

If you have used a marketed avoidance scheme which HM Revenue and Custom (HMRC) believes to be ineffective, they will challenge the scheme in the courts.

Usually one or two cases are selected as test cases and take several years to go through the courts. The rest - called "followers" by HMRC - sit and wait to see what happens. During this time, followers normally retain the benefit of the tax saving, and HMRC have to recover the money later if they win in the courts.

ew rules are expected to make two changes. Firstly, if the scheme is defeated at any stage in the courts, followers will be asked to concede their case. If they do not, because they hope the test case will succeed on appeal, they will be charged a penalty if the test case is eventually lost on the same point of law.

Secondly, once HMRC have won in the courts, the followers who do not concede will have to pay over the tax which has been avoided, even though the test case itself appeals to a higher court.

That's exactly what I mean! If it won't affect us, how do I explain this? My wife is fearing for the worst at the moment...

[ready_to_leave]

So in the Autumn statement today, I've read that the chancellor is proposing that where HMRC believes tax is due, any disputed amount would be payable to HMRC in advance of any investigation/appeal process, to be returned on a successful appeal. Three main questions (of course there are many more):-

(i) does anyone know the details of this, to the degree that if it goes through, could this be applied to us?
(ii) how on earth can such a proposal not be considered illegal? It's guilty until proven innocent for heaven's sake.
(iii) is this something that NTRT are/should be aware of as it potentially as damaging as what we are currently fighting!

Swede.

HMRC do not view that property rights exist, they see the law as nothing but a rule book of enforcement, and that a thousand years of judicial development to balance arbitrary power is irrelevant. The previous/sitting government (plus the potential opposition parties) are entirely aligned in this view.

Once you have this view as the norm in government and the alternatives, you have established a defacto tyranny even if you do not parade around in public in sunglasses and an army uniform.

No action is then out of bounds, retrospection first, presumption of guilt for the individual next, jeopardy fines for challenge of bureaucratic process, denial of appeal recourse to the law, laws so general that they can be applied to mean almost anything, redefinition of widely accepted terms to enable conflation of normal behaviour with illegal activity, arbitrary confiscation without conviction.

The sky is the limit for the vested interest of the civil service and the political morons and for those thinking it will get better, there is plenty more to come, which will make BN66 look like the judgement of a well balanced mind.

[DonkeyRhubarb]

not true according to the BBC website:

BBC News - Autumn Statement: Bid to recoup £9bn in unpaid tax

If you have used a marketed avoidance scheme which HM Revenue and Custom (HMRC) believes to be ineffective, they will challenge the scheme in the courts.

Usually one or two cases are selected as test cases and take several years to go through the courts. The rest - called "followers" by HMRC - sit and wait to see what happens. During this time, followers normally retain the benefit of the tax saving, and HMRC have to recover the money later if they win in the courts.

ew rules are expected to make two changes. Firstly, if the scheme is defeated at any stage in the courts, followers will be asked to concede their case. If they do not, because they hope the test case will succeed on appeal, they will be charged a penalty if the test case is eventually lost on the same point of law.

Secondly, once HMRC have won in the courts, the followers who do not concede will have to pay over the tax which has been avoided, even though the test case itself appeals to a higher court.

The government will also consult on whether to tighten these rules further, to prevent those using tax avoidance arrangements gaining a cash-flow advantage while it is under challenge.

The only main difference between the above and the current situation is penalties.

If Huitson/Shiner (the test cases) lose their appeal at the FTT then HMRC would be entitled to demand payment from them immediately using the changes introduced in 2010, without having to wait for any subsequent appeals to be heard eg. to the UTT etc.
HM Revenue & Customs: Enforcement of judgements in litigation

If HMRC enforce payment on Huitson/Shiner after the FTT, you can be pretty certain of them coming after the rest of us at the same time. Yes, of course, in theory we could lodge individual appeals but these would be dismissed very quickly, since most would have no merit in the eyes of the court. They would be regarded as frivolous or vexatious.

The only unknown at the moment is whether HMRC will enforce collection after the FTT, or exercise their discretion and allow the appeals process to run its course.

[smalldog]

The only main difference between the above and the current situation is penalties.

If Huitson/Shiner (the test cases) lose their appeal at the FTT then HMRC would be entitled to demand payment from them immediately using the changes introduced in 2010, without having to wait for any subsequent appeals to be heard eg. to the UTT etc.
HM Revenue & Customs: Enforcement of judgements in litigation

If HMRC enforce payment on Huitson/Shiner after the FTT, you can be pretty certain of them coming after the rest of us at the same time. Yes, of course, in theory we could lodge individual appeals but these would be dismissed very quickly, since most would have no merit in the eyes of the court. They would be regarded as frivolous or vexatious.

The only unknown at the moment is whether HMRC will enforce collection after the FTT, or exercise their discretion and allow the appeals process to run its course.

I can't believe they would apply this new measure to us, that would be yet another retrospection. Surely it would be prospective on new tax cases. Not back filling old, otherwise where's the end point.

[DonkeyRhubarb]

I can't believe they would apply this new measure to us, that would be yet another retrospection. Surely it would be prospective on new tax cases. Not back filling old, otherwise where's the end point.

It does look like they intend some of the new rules to apply to existing cases.

Gov't targets £3.5 billion from wealthy with failed tax scheme rules - Citywire

"The government said this will provide HMRC with an additional tool to address a legacy stock of an estimated 65,000 avoidance cases, around 85% of which date back to before 2010."

[smalldog]

It does look like they intend some of the new rules to apply to existing cases.

Gov't targets £3.5 billion from wealthy with failed tax scheme rules - Citywire

"The government said this will provide HMRC with an additional tool to address a legacy stock of an estimated 65,000 avoidance cases, around 85% of which date back to before 2010."

Have any timelines been mentioned on when this will come into effect?

[PlaneSailing]

New changes

Have any timelines been mentioned on when this will come into effect?

Looks like July 2014

https://www.gov.uk/government/news/a...-december-2013

Didn't the HMRC brief say that they would not try and enforce payment until the legal process had run it's course?

[DonkeyRhubarb]

Have any timelines been mentioned on when this will come into effect?

I haven't seen anything definite.

Notwithstanding these changes, there was always a danger of enforcement if the test cases were lost at the FTT.

[HEAVY SARCASM]
HMRC's goodwill only goes so far.
[/HEAVY SARCASM]

If/when the time comes, we (NTRT) need to be prepared to resist this vigorously.