Settlement Opportunity

[AlCapone]

Settling after 9th Jan

Was just wondering, if one did not settle before the cut off date and then subsequently decided to settle before any litigation took place, how would that work? Would you ask HMRC for a closure notice? If they did offer a closure notice how would the final amount due be different from the settlement figure (apart from more interest)? Presumably they couldn’t impose penalties as legally you still don’t owe the tax?

[Rob79]

Was just wondering, if one did not settle before the cut off date and then subsequently decided to settle before any litigation took place, how would that work? Would you ask HMRC for a closure notice? If they did offer a closure notice how would the final amount due be different from the settlement figure (apart from more interest)? Presumably they couldn’t impose penalties as legally you still don’t owe the tax?

You need to be clear that the settlement offer expires in January next year.

If you settle after that, you may get different terms. Usually you would settle by way of a Deed (an exchange of agreements) and that would avoid the need for a closure notice on a disputed assessment.

The difference in settlement could be anything. For example, the present settlement seems to say that they treat the loans as gross income from which you can deduct reasonable expenses perhaps. (I've not really studied it in detail or spoken with HMRC so please don't get all pedantic on me). A settlement post the expiry might say that the income you have is net salary which is grossed up for tax and from which no expenses can be deducted.

Penalties do not depend on the "legality" or otherwise of the tax charge. The schemes you did were all "legal" it's just that one person's interpretation of the payments was preferred over another. A Judge decides which is (if you like) more "legal" than the other. Does not mean that one is illegal.

Penalties are based on your behavior. Were you careless? Were you reckless? Were you deliberately seeking to mislead? Were you deliberately hiding something? Were you acting fraudulently?

Based on what HMRC think you were, a penalty can be imposed. You can appeal that and a Judge will have a view.

[flamel]

don't give in

http://www.taxchambers.com/wp-conten...s-Notices3.pdf

In my case, there is no room for time to pay (retiring soon) so bankruptcy is the only option. Unless they have some method of keeping me alive for the next 100 years to pay them a portion of my state pension!

[AlCapone]

You need to be clear that the settlement offer expires in January next year.

If you settle after that, you may get different terms. Usually you would settle by way of a Deed (an exchange of agreements) and that would avoid the need for a closure notice on a disputed assessment.

The difference in settlement could be anything. For example, the present settlement seems to say that they treat the loans as gross income from which you can deduct reasonable expenses perhaps. (I've not really studied it in detail or spoken with HMRC so please don't get all pedantic on me). A settlement post the expiry might say that the income you have is net salary which is grossed up for tax and from which no expenses can be deducted.

Penalties do not depend on the "legality" or otherwise of the tax charge. The schemes you did were all "legal" it's just that one person's interpretation of the payments was preferred over another. A Judge decides which is (if you like) more "legal" than the other. Does not mean that one is illegal.

Penalties are based on your behavior. Were you careless? Were you reckless? Were you deliberately seeking to mislead? Were you deliberately hiding something? Were you acting fraudulently?

Based on what HMRC think you were, a penalty can be imposed. You can appeal that and a Judge will have a view.

Thanks, Rob. I've been in told by the company that pitched my scheme that its former introducers and intermediaries no longer exist so there is limited support they can offer. However they say that another arrangement that was set up "used an identical remuneration structure. The arrangements were given the same scheme reference number (SRN) by HMRC under the Disclosure of Tax Avoidance Scheme regime and are now, we believe, being dealt with by the same lead Inspector at HMRC".

They say they believe my outcome as an employee of x will ultimately be determined by the litigation outcome of y.

Do you think this is likely? Will the common SRN be sufficient for me to ride on the coat tails of the litigation outcome (good or bad)?

[meanttobeworking]

For example, the present settlement seems to say that they treat the loans as gross income from which you can deduct reasonable expenses perhaps.

Sorry if I've missed discussions about this, but could you expand please? Are you saying that I could get the calculated taxable income figure reduced by calculating expenses for mileage, etc? If so, how would I go about doing that? My provider is no longer around (legally at least).

[jbryce]

Thanks, Rob. I've been in told by the company that pitched my scheme that its former introducers and intermediaries no longer exist so there is limited support they can offer. However they say that another arrangement that was set up "used an identical remuneration structure. The arrangements were given the same scheme reference number (SRN) by HMRC under the Disclosure of Tax Avoidance Scheme regime and are now, we believe, being dealt with by the same lead Inspector at HMRC".

They say they believe my outcome as an employee of x will ultimately be determined by the litigation outcome of y.

Do you think this is likely? Will the common SRN be sufficient for me to ride on the coat tails of the litigation outcome (good or bad)?

The legislation (FNs). allow you to be guilty by association, but not innocent by association. So if 'y' wins then you will not be off the hook because 'x' is similar - it may deter HMRC, but that's about it.

[AlCapone]

The legislation (FNs). allow you to be guilty by association, but not innocent by association. So if 'y' wins then you will not be off the hook because 'x' is similar - it may deter HMRC, but that's about it.

Thanks, thought that might be the case. Why the hell would they make it easy for me! So basically as the provider is not defending this particular scheme it's up to me to defend it individually at a tribunal or find a group who were on the same scheme

[DonkeyRhubarb]

Take the Rangers case for example.

If HMRC win their appeal then they will no doubt claim it's similar to contractor EBTs and use this to justify issuing FNs.

If, on the other hand, they lose then they'll claim contractor EBTs are different and still press ahead with more tribunals.

Don't expect them to behave ethically or honestly !!!

[AlCapone]

Take the Rangers case for example.

If HMRC win their appeal then they will no doubt claim it's similar to contractor EBTs and use this to justify issuing FNs.

If, on the other hand, they lose then they'll claim contractor EBTs are different and still press ahead with more tribunals.

Don't expect them to behave ethically or honestly !!!

Is that going to CoA? I thought it was case closed.

[centurian]

Is that going to CoA? I thought it was case closed.

Nope. HMRC got leave to appeal to the Court of Session (basically CoA for Scotland)