cost for Litigation
So would there be extra costs for Big group members if it was decided to go down the path of litigation?
Originally posted by webberg
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There is a choice to be made between settlement and fighting on.
The settlement offer will arrive this year, perhaps early next and you will have a limited time to accept it. If you do not accept it, your choices then become litigating or reaching some other agreement with HMRC. Clearly Big Group is aiming at reaching that agreement on behalf of all its members but will, if required, litigate.
So, until you reach a point of the settlement offer expiring, a final decision is not required.
The loan charge is based on a deemed event at 5th April 2019. You are required to disclose information by the end of September 2019 and the tax is due 31st January 2020.
Will we have a resolution by then? Probably not as HMRC are using their usual delaying tactics and even though we are pushing hard, getting a Tribunal date and decision by then is unlikely. (This assumes that HMRC continue to litigation, even where they have a low chance of winning, because despite a strategy on these matters, HMRC routinely disregard it and continue anyway).
So the question then becomes whether a loan charge arises.
We have seen promoters of various colours claim that their scheme is outside the loan charge rules. we have seen HMRC claim the opposite. Given that HMRC has not backed up their claims with a factual analysis of each scheme it has to be observed that the "all loans are caught" type of statements owe more to dogmatic adherence to policy than application of law to facts.
However, it's clear that non disclosure or appeal against an assessment or statement, will be met with a contrary position from HMRC, possibly leading to further litigation.
We have an analysis that in some instances supports what the promoters say and in some cases does not. We will make that available to all Big Group members and explain the consequences of that analysis being right or wrong. We cannot and do not guarantee that if we say no disclosure is required or that the loan charge can be defeated, we are correct.
Doing anything that is contrary to HMRC's view brings a risk. We will explain those risks to our members and guide them as to a sensible decision.
That decision might be:
Settle
Litigate the loan charge
Litigate the scheme
Pay the loan charge and fight afterwards
Pay the loan charge on all years
Pay the loan charge only on closed years
Much as I would like to present simple, black or white, options, I cannot.
The settlement offer will arrive this year, perhaps early next and you will have a limited time to accept it. If you do not accept it, your choices then become litigating or reaching some other agreement with HMRC. Clearly Big Group is aiming at reaching that agreement on behalf of all its members but will, if required, litigate.
So, until you reach a point of the settlement offer expiring, a final decision is not required.
The loan charge is based on a deemed event at 5th April 2019. You are required to disclose information by the end of September 2019 and the tax is due 31st January 2020.
Will we have a resolution by then? Probably not as HMRC are using their usual delaying tactics and even though we are pushing hard, getting a Tribunal date and decision by then is unlikely. (This assumes that HMRC continue to litigation, even where they have a low chance of winning, because despite a strategy on these matters, HMRC routinely disregard it and continue anyway).
So the question then becomes whether a loan charge arises.
We have seen promoters of various colours claim that their scheme is outside the loan charge rules. we have seen HMRC claim the opposite. Given that HMRC has not backed up their claims with a factual analysis of each scheme it has to be observed that the "all loans are caught" type of statements owe more to dogmatic adherence to policy than application of law to facts.
However, it's clear that non disclosure or appeal against an assessment or statement, will be met with a contrary position from HMRC, possibly leading to further litigation.
We have an analysis that in some instances supports what the promoters say and in some cases does not. We will make that available to all Big Group members and explain the consequences of that analysis being right or wrong. We cannot and do not guarantee that if we say no disclosure is required or that the loan charge can be defeated, we are correct.
Doing anything that is contrary to HMRC's view brings a risk. We will explain those risks to our members and guide them as to a sensible decision.
That decision might be:
Settle
Litigate the loan charge
Litigate the scheme
Pay the loan charge and fight afterwards
Pay the loan charge on all years
Pay the loan charge only on closed years
Much as I would like to present simple, black or white, options, I cannot.
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