Murray Group (Rangers) tax case - decision today?

[bitfrustrated]

ps. it would be a bit of poetic justice if HMRC had to chase the employers (promoters).

For too many years, the promoters have got away scott free raking in £millions. It's about time they shared a bit of the pain.

And, if HMRC can't collect off them, well that's their problem.

Is there an appetite for contractors to go after the promoters, before HMRC gets their hands on them? Seems like they are the main beneficiaries of their risky schemes, firstly pocketing structure/admin fees, now living off the litigation process. If they returned structure/admin/litigation costs back to the scheme participants, it would go some way to pay off those APNs.

[DotasScandal]

If they returned structure/admin/litigation costs back to the scheme participants, it would go some way to pay off those APNs.

Oh, look! a flying pig!

[bitfrustrated]

Oh, look! a flying pig!

Accessible, grounded pigs, with still operational offices manned by the same 'tax advisers'. What's the alternative - let them get away with it?

[webberg]

Accessible, grounded pigs, with still operational offices manned by the same 'tax advisers'. What's the alternative - let them get away with it?

I think my friend, Mr Scandal, is correct and chasing promoters will result in your forum name changing to "evenmorefrustrated".

The promoter firms are mostly long gone. The people who populated them may well be sat at desks in the same office, selling similar products and profits going to the same shareholders. However, legally it's probably a different company and one that has no connection with the outfit who sold you the scheme.

You would therefore have to show that an individual was responsible for selling you a scheme that may not work. (Don't forget that as yet, it has not been proven that there is a tax liability and it may be some years before that happens). Pinning responsibility on the individual is DIFFICULT. Tracing that individual through to another firm and claiming against the new legal entity even MORE DIFFICULT.

The promoter firms were not regulated and not required to contribute to a statutory fund to compensate victims. This is a failing on part of the Isle of Man and UK Governments. I've seen a paper that discusses the chance of that failure in itself leading to a compensation claim from the Government. The paper concludes that the chance is VERY LOW.

So presently, you have no proven loss; the promoter firm no longer trading; almost impossible to prove the liability of an individual; no regulation authority to move against; some very hard legal yards (each very expensive); time passing.

Frustrating as it is, I think you have to allow the firms to "get away with it" but hope that HMRC turn their PAYE guns on the individuals.

[bitfrustrated]

I think my friend, Mr Scandal, is correct and chasing promoters will result in your forum name changing to "evenmorefrustrated".

The promoter firms are mostly long gone. The people who populated them may well be sat at desks in the same office, selling similar products and profits going to the same shareholders. However, legally it's probably a different company and one that has no connection with the outfit who sold you the scheme.

You would therefore have to show that an individual was responsible for selling you a scheme that may not work. (Don't forget that as yet, it has not been proven that there is a tax liability and it may be some years before that happens). Pinning responsibility on the individual is DIFFICULT. Tracing that individual through to another firm and claiming against the new legal entity even MORE DIFFICULT.

The promoter firms were not regulated and not required to contribute to a statutory fund to compensate victims. This is a failing on part of the Isle of Man and UK Governments. I've seen a paper that discusses the chance of that failure in itself leading to a compensation claim from the Government. The paper concludes that the chance is VERY LOW.

So presently, you have no proven loss; the promoter firm no longer trading; almost impossible to prove the liability of an individual; no regulation authority to move against; some very hard legal yards (each very expensive); time passing.

Frustrating as it is, I think you have to allow the firms to "get away with it" but hope that HMRC turn their PAYE guns on the individuals.

In my case there's 2 types of entities: the trusts (aka employers) and the promoter of tax schemes. The trusts ceased to exist but the promoter has been active in the same capacity since I've joined them. In theory the promoter is just the middle man, in practice he's the only interface I've had with the trusts. Based on the promoter's advice, I already suffer a financial hardship, echo of which will linger on irrespective of the potential APN refunds. Surely the (still operational) promoters bear responsibility for such 'expert' advice?

[webberg]

In my case there's 2 types of entities: the trusts (aka employers) and the promoter of tax schemes. The trusts ceased to exist but the promoter has been active in the same capacity since I've joined them. In theory the promoter is just the middle man, in practice he's the only interface I've had with the trusts. Based on the promoter's advice, I already suffer a financial hardship, echo of which will linger on irrespective of the potential APN refunds. Surely the (still operational) promoters bear responsibility for such 'expert' advice?

Afraid I'd disagree.

The trusts are NOT the employer. You have no employment agreement with them. The agent (probably part of the promoter group) was the employer.

The trusts still exist. They received a contribution, made a loan and are now required to look after the beneficiary. That in itself is potentially a problem for another day.

The promoter, said to you. "Do this and that and your tax bill becomes this". They may have said "We have an opinion from somebody we've paid and who works for us, that this is "compliant" with all tax law"

Your tax affairs are YOUR responsibility. Could/should you have tested the above statements with a professional, i.e. somebody trained in accountancy and tax and who has to meet the standards of the bodies he/she belongs to? HMRC would certainly say that a "reasonable man" would almost certainly have done so.

Can you rely upon an opinion given to a third party? Difficult territory but in this case a QC is a very difficult person to sue as they give an opinion, not a statement of fact.

Unless you ran this past another professional adviser (and most promoters as firms/individuals are not professionals) I'm afraid that you need to do yourself a favour and bury thoughts of retribution unless you have endless patience and deep pockets.

[DotasScandal]

Could/should you have tested the above statements with a professional, i.e. somebody trained in accountancy and tax and who has to meet the standards of the bodies he/she belongs to? HMRC would certainly say that a "reasonable man" would almost certainly have done so.

HMRC would say that, conveniently ignoring that the DOTAS registration of a structure was commonly perceived by the end clients, like it or not, as an HMRC seal of approval*!
It was even presented that way by some promoters.
The impression was reinforced by HMRC's complete absence of follow-ups to enquiry letters, in line with the promoters' narrative that "those are just routine checks".

*: there is anecdotal evidence of people phoning HMRC to inquire whether the structure they contemplated joining was kosher, and being informed by a friendly HMRC officer that "if it is DOTAS-registered, it's ok to use".

[LandRover]

"Unless you ran this past another professional adviser"

Like a Chartered Accountant?

The same person who advised me to go onto the scheme as IR35 was such a threat to me.

Accountant sitting behind his desk informing you that he feels IR35 is becoming a concern and he is protecting his clients, kind of makes you feel he is watching your back!

Go back a few years and the climate was so different.

[cliffordthedog]

My accountant (chartered) advised just the same.

Has been family accountant for 25 years.

You employ the professionals to get the advice. I believe that he was providing good honest guidance.

HMRC did not provide any guidance despite the obvious use of these schemes going back many years.

It is still difficult to comprehend such lax ways of operation by HMRC that allowed this problem to build up as it has.

[webberg]

Thunder has passed

As indicated, I have penned a piece for this website on my view on the Rangers case.

This is available now.

As with all these articles, they compress and inevitably shorten the arguments and as such some of the nuances are not really brought out.

The decision is public property. My article is public property now as well.

I'm happy to debate my opinion and views here, via PM or email.

This decision is a milestone. Please take time to read it and understand it. If you are struggling to understand it please persevere as it will help you.

If you have questions that you consider are too simple or risk you appearing a fool, I would encourage you to ask them because often the simplest questions bring the greatest value.

It is my opinion that understanding the nuances and implications of this decision will be a crucial factor in weighing future decisions.