Guilty until proved innocent

[shaunbhoy]

IIRC, Tax Avoidance was/is not illegal, only Tax Evasion. I'd imagine some sharp-suited lawyer might be able to argue that convincingly despite HMRC's protests to the contrary.
Of course some of these schemes sailed very close to the wind and only had a fairly short shelf life before being snuffed out.
If some of those schemes operated legally before Gordon Brown "closed the loophole" then surely they can only realistically go back as far as that date in pursuance of back taxes?
The closure of said schemes' loophole would have been around 2002-3 wouldn't it?

[AtW]

Why tax avoidance schemes are allowed to be sold without warranties in a form of 3rd party insurance in case the product "did not work"???

[centurian]

No, it's not the same principle.

Under PAYE you only pay on account if you have to complete a self assessed tax return. If you are a normal employee it is deducted from your pay, at the point at which you are paid, for the period which that pay relates to. There is no advance payment happening. The only way it can go wrong is if your employer screws up or HMRC has you on the wrong tax code.

If you do complete an SA they you pay half the forecast tax due on account, based on your current years income, not some arbitrary amount that HMRC may decide you owe for tax years already completed. It is offset against tax falling due in the next year, at which point you pay the balance. If you feel your liabilities will be substantially different you can make a submission to HMRC to revise your payment due on account.

You cannot appeal an APN unless you can demonstrate HMRC have got it wrong, and even then you still have to pay up in 90 days or face penalties.

I think you're missing the point.

Obviously, there are huge differences in the detail - of which you have detailed above, but HMRC will argue that this is irrelevant - the underlying principle is the same - pay first, argue later.

I'm not saying this argument will win in court - it's up to the judges to decide. But I am saying to expect arguments like this. Remember that there is no hard and fast law as to what constitutes a breach under the ECHR. Both sides have a very latitude to argue their definition of "fair".

Or to put it another way, what do you seriously think HMRC will do at the ECHR - say "oh, we agree it's unfair - how silly of us" - of course not, they'll fight it all the way using whatever arguments they feel will win - however nonsensical it may seem to us.

[Chuck]

Or to put it another way, what do you seriously think HMRC will do at the ECHR - say "oh, we agree it's unfair - how silly of us" - of course not, they'll fight it all the way using whatever arguments they feel will win - however nonsensical it may seem to us.

And HMRC has a bottomless pit of our money to pay for it all.

[AtW]

Isn't there an argument that those "schemes" were missold and therefore organizers could be pursued in courts?

[VectraMan]

Or to put it another way, what do you seriously think HMRC will do at the ECHR - say "oh, we agree it's unfair - how silly of us" - of course not, they'll fight it all the way using whatever arguments they feel will win - however nonsensical it may seem to us.

If the Kippers get their way Britain will no longer be subject to the ECHR. Problem solved.

[tomtomagain]

They could sell those loans to debt collectors for half the value...

That would be pure evil .... frankly I wouldn't put it past them.

DEBT COLLECTOR : 'Ere we've come to collect the £250k you've been loaned by OffshoreTaxEfficiency Inc.

CONTRACTOR : Ahhh you see there's been some sort of mistake. You see its only a pretend loan so I didn't have to pay tax.

DC : I don't care. I'm taking the money or breaking your legs.

[centurian]

That would be pure evil .... frankly I wouldn't put it past them.

DEBT COLLECTOR : 'Ere we've come to collect the £250k you've been loaned by OffshoreTaxEfficiency Inc.

CONTRACTOR : Ahhh you see there's been some sort of mistake. You see its only a pretend loan so I didn't have to pay tax.

DC : I don't care. I'm taking the money or breaking your legs.

That is what I always found to be the paradox of the loan schemes.

In order to be fully and absolutely 100% out of reach of HMRC, it had to be an absolutely genuine loan, which meant it could be called in at any point.

Quite why anyone would agree to forgo earnings and in return receive a "loan" is beyond me.

[AtW]

Quite why anyone would agree to forgo earnings and in return receive a "loan" is beyond me.

More greed cells in the head than brain cells.

"In the words of Kenneth Parker J, the Scheme would “appear to realise every taxpayer’s dream of lawfully avoiding, or at least greatly reducing, income tax in any
jurisdiction”. In the case of Mr Huitson the effective rate of tax he would suffer on his income would be approximately 3.5%"

[Zero Liability]

And I thought avoidance was legal?

Anyway, my concern is that APN powers will be extended to anyone HMRC believes is IR35 caught. And will take the money allegedly owed directly out of bank accounts.

I really hope that IPSE and writing to MPs and petitions will make a difference.

They could be, but I presume it would require substantial legislative change, because my understanding is that they can only do this where they believe the scheme in question is materially similar to one already defeated in court. I struggle to see how they could do that with IR35, where their win:loss ratio when challenged is abysmal, and where each case is fairly unique. Perhaps if they reformed it to boil it down to SDC, but even then that is a pretty complex area of law.