Montpelier DTA scheme bulletin

[changeforthebetter]

FNs issued in October

Hi All, Decided to take my head out of the sand and deal with this MP nonsense.
I was issued with my final APN notice which I have to pay by the end of Jan. The difference with this is that they have also issued something called Corrective Action form which you have to complete. Basically I think they are asking you to relinquish any ownership of the money you pay them. They have stated that the appeal was won by HMRC and the matter has ended so pay up. If you just pay the APN and do not sign the form, then you will be due a penalty.

Have others received the same Corrective Action form to complete?

I'm lost and looking for guidance - any help appreciated.

[CanPayButWouldRatherNot]

This corrective action is called a follower notice (FN) ...All of us mtm users pre march 2008 have them and unless you send in legal representation to appeal it ....You will have to sign it. If you ignore it the penalties are Draconian. Government powers granted to the hmrc steamroller alas.

[CanPayButWouldRatherNot]

Graham from big group is offering some well priced advice to people that don't already have legal assistance ...Have a read on this forum for big group. Also if you have any loan scheme mtm exposure they will help with that.

[JsonDude]

Just called HMRC to clarify APNs and FNs

I called HMRC a couple of days ago and had a 30 minute conversation with a helpful bloke. This is what I learned:

1) The amounts in the APNs are for tax due only, and doesn't include interest. I asked how to calculate the interest due and was told if you use an annualised rate of about 3.5% compounded then that should give you a ballpark figure - assuming you need to go back to about 2003. Apparently the interest calculations are quite complex, so producing an exact figure isn't something that HMRC can do over the phone. Luckily the Global Financial Crisis of 2008 killed interest rates, so compounded interest rates HMRC have been charging since 2008 are very low - somewhere around 1%.

2) The penalty for not paying an APN in time is 5%

3) Taking the corrective action for a FN does involve signing away your rights to the scheme. So even if MTMs appeal is successful eventually, if you've taken the corrective action, then it won't benefit you. You'll still be liable to pay all the tax to HMRC.

4) The penalty for not returning the FN with corrective action is 50% - yes, five-zero!

5) Taking the corrective action and returning your completed FNs will trigger the final part of the process - which will be HMRC calculating the interest you need to pay.

So unfortunately those of us with FNs and APNs due in Feb (me included) are stuck between a rock and a hard place. Do we hold out to hear the outcome of the appeal and potentially risk the 50% penalty, or complete the FNs and sign away all rights.

[BrilloPad]

So unfortunately those of us with FNs and APNs due in Feb (me included) are stuck between a rock and a hard place. Do we hold out to hear the outcome of the appeal and potentially risk the 50% penalty, or complete the FNs and sign away all rights.

If you have a LoR that gives at least another 4 weeks(if accepted it gives a lot longer). Without the LoR then you should wait until the 9th Feb and see the outcome. If you can't wait then I reckon you should pay.

IANAL. IANAAA. I am not a lawyer/accountant. If you disagree, do otherwise.

[webberg]

I called HMRC a couple of days ago and had a 30 minute conversation with a helpful bloke. This is what I learned:

1) The amounts in the APNs are for tax due only, and doesn't include interest. I asked how to calculate the interest due and was told if you use an annualised rate of about 3.5% compounded then that should give you a ballpark figure - assuming you need to go back to about 2003. Apparently the interest calculations are quite complex, so producing an exact figure isn't something that HMRC can do over the phone. Luckily the Global Financial Crisis of 2008 killed interest rates, so compounded interest rates HMRC have been charging since 2008 are very low - somewhere around 1%.

2) The penalty for not paying an APN in time is 5%

3) Taking the corrective action for a FN does involve signing away your rights to the scheme. So even if MTMs appeal is successful eventually, if you've taken the corrective action, then it won't benefit you. You'll still be liable to pay all the tax to HMRC.

4) The penalty for not returning the FN with corrective action is 50% - yes, five-zero!

5) Taking the corrective action and returning your completed FNs will trigger the final part of the process - which will be HMRC calculating the interest you need to pay.

So unfortunately those of us with FNs and APNs due in Feb (me included) are stuck between a rock and a hard place. Do we hold out to hear the outcome of the appeal and potentially risk the 50% penalty, or complete the FNs and sign away all rights.

1. HMRC charge tax on a simple, not a compound basis. The various rates applied since 2003 might be the equivalent of 3.5% compound but to present them that way is very misleading. https://www.gov.uk/government/public...interest-rates is where the rates are. It's a simple day count from the due date.

2. It's actually 5% if not paid within 28 days for most the current crop of APNs and another 5% after 6 months.

3. Partly true. You have to give up the claim you made but you may be able to replace it with another.

4. Partly true. You have to take corrective action and then tell HMRC you've done that and calculate the tax effect.

5. Probably true.

[smalldog]

I called HMRC a couple of days ago and had a 30 minute conversation with a helpful bloke. This is what I learned:

1) The amounts in the APNs are for tax due only, and doesn't include interest. I asked how to calculate the interest due and was told if you use an annualised rate of about 3.5% compounded then that should give you a ballpark figure - assuming you need to go back to about 2003. Apparently the interest calculations are quite complex, so producing an exact figure isn't something that HMRC can do over the phone. Luckily the Global Financial Crisis of 2008 killed interest rates, so compounded interest rates HMRC have been charging since 2008 are very low - somewhere around 1%.

2) The penalty for not paying an APN in time is 5%

3) Taking the corrective action for a FN does involve signing away your rights to the scheme. So even if MTMs appeal is successful eventually, if you've taken the corrective action, then it won't benefit you. You'll still be liable to pay all the tax to HMRC.

4) The penalty for not returning the FN with corrective action is 50% - yes, five-zero!

5) Taking the corrective action and returning your completed FNs will trigger the final part of the process - which will be HMRC calculating the interest you need to pay.

So unfortunately those of us with FNs and APNs due in Feb (me included) are stuck between a rock and a hard place. Do we hold out to hear the outcome of the appeal and potentially risk the 50% penalty, or complete the FNs and sign away all rights.

4 is UPTO 50%, not guaranteed 50%, but a minimum of 10%. Its the usual HMRC scaremongering to get people to fold with the threat of huge penalties.

[Laxmi]

to LoR or not

I'm mulling over the LoR from WTT big group. I have paid the APNs, I know MP will not win as so far they have failed to and filed 6 months late! Unfortunately I will be out of the country for a month.
So, need to make a decision fast as to have a rep or sign away rights. If MP's appeal is thrown out, then I'm not sure the LoR will buy 30 days. The LoR could be rejected.

[ns1]

I'm mulling over the LoR from WTT big group. I have paid the APNs, I know MP will not win as so far they have failed to and filed 6 months late! Unfortunately I will be out of the country for a month.
So, need to make a decision fast as to have a rep or sign away rights. If MP's appeal is thrown out, then I'm not sure the LoR will buy 30 days. The LoR could be rejected.

If HMRC reject the representations they have to give you another 30 days. That's the law.

[Laxmi]

If HMRC reject the representations they have to give you another 30 days. That's the law.

Thanks. HMRC are a 'law' unto themselves. When I sent a letter of rep last time for the same scheme regarding the APNs they rejected the representation and said the original dates stands as is. Thankfully I has a couple of weeks at that time. And lo and behold the APNs were withdrawn months later.