Interesting S660 FTT decision

[BolshieBastard]

Section 660 is Not Child's Play - Contractor Weekly

Interesting to consider the FTT's deliberations, paricularly regarding 'Discovery' and penalties hMRC imposed. These may give a glimmer of hope to those of us caught up with BN66!

[Clare@InTouch]

It's an interesting case, and proves the other applications of Section 660. It's not just related to shares and Arctic Systems, so people need to take a wider view when they do things for tax motivated reasons.

If anyone has some time to kill, the HMRC guidance is a useful read: TSEM4000 - Settlements legislation: contents

[northernladuk]

Will it? Although a convoluted situation it seems to involve something that has been said many times on here before and that is involving more than just his spouse in his tax affairs. We have differing opinions on using your wife let alone getting the kids involved.

[BolshieBastard]

Will it? Although a convoluted situation it seems to involve something that has been said many times on here before and that is involving more than just his spouse in his tax affairs. We have differing opinions on using your wife let alone getting the kids involved.

No, what I meant was the FTT considered, effectively, whether hmrc had correctly used their power of discovery. In this instance they decided they had but, it might be a chink of light for some people caught up with BN66 since hmrc opened many closed assessments under discovery. There is a feeling within the BN66 community that hmrc overreached their ability to use discovery to re open or indeed, open enquiries well outside the time constraints.

Further, they then considered whether the penalties hmrc imposed in this case were correct and proportional. This is possibly the biggest chink of light for those caught up with BN66 since hmrc failed to do anything to close the scheme for 7 years. When they finally did under BN66, they look to impose penalties back to year dot.

The FTT may decide these penalties were incorrect and disproportional and could potentially remove a lot of money that is currently deemed payable.

[lucozade]

I couldn't follow if the chap got hammered or not from the article.

Was interesting to use how FTT considered things though, especially relating to HMRC behavior.

There may be a chink of light for bn66 victims after all.

[Wanderer]

I couldn't follow if the chap got hammered or not from the article.

It was interesting how he got let off on the penalties by claiming ignorance of the law....

The Tribunal stated that the technical rules surrounding the settlements legislation were outside the normal consideration which a taxpayer would have in mind when making a return to HMRC. Although his accountant knew of what he was doing they did not take issue with him or alert him to the potential problems he was creating. Penalties were therefore considered inappropriate and set aside.

So ignorance of the law is an excuse......

[Maslins]

It was interesting how he got let off on the penalties by claiming ignorance of the law....



So ignorance of the law is an excuse......

I think there's a difference between ignorance of the law, and a law being sufficiently unclear that a reasonable person could interpret it in a different way to how HMRC/the court does.

Saying "Oh, I didn't know I had to pay corporation tax"/similar is very different to something like this. Same way I'd hope anyone getting challenged under IR35 who'd done appropriate due diligence (eg contract review etc), whilst if they lost they'd have to pay the additional tax, they shouldn't suffer penalties. They hadn't been fraudulent or negligent, and could argue they had taken reasonable steps to ensure they'd done things correctly.

[nevergiveup]

I couldn't follow if the chap got hammered or not from the article.

Was interesting to use how FTT considered things though, especially relating to HMRC behavior.

There may be a chink of light for bn66 victims after all.

Hope Montpelier read these threads!!!