Horizon exit opportunity (Non-Big Group discussion thread)

[Iliketax]

I'd imagine they've taken QC opinion on this.

Imagine?

As part of my day job I regularly see tax counsel, mostly QCs. I choose to go to those that I trust to give me a proper opinion. I rarely ask for their view on the technical points of tax law or the policy objectives of tax law as I, and the people I work with, are normally more competent in those areas than the average QC. I ask their opinion about how the courts will view those technical arguments. That is what they are particularly good at. I also make sure that I give them good, detailed instructions that properly set out the facts and the tax analysis.

I am absolutely certain that all of the QCs that I have seen in, say, the last seven years would not give me a favourable opinion of what you have described here (although much of what you have written is pretty vague).

Is there a QC out there who would give a favourable opinion? I can guess at a couple who would give a positive opinion on a narrow question based on a narrow set of facts. I would never pay for their opinion though as it would be of no use to my clients. As an aside, I saw one of these at a free conference about 15 month and his talk was pretty much a rant where he mentioned Hitler in the first five minutes.

This is a bona fide accountancy firm in the UK, not the usual chancers in IOM and Cyprus. Should I not rely on their advice?

There are two answers to this question:

1. If they gave you specific advice on your specific facts and the advice was comprehensive and they were competent to give that advice then you would normally be able to rely on that. But I don't know what you asked them, what they said / didn't say or whether they are competent to give that advice. You can test whether what they said was comprehensive by looking at what their letter said about: GAAR, DOTAS, the current state of the draft legislation / how it may change, and the attitude to the courts of what is proposed. If they didn't mention it or laughed it off then that's a good indicator that you can't rely on it. But that won't tell you if they are competent. And I'd bet money that the vast majority of accountancy firms are not competent to advice on this specific piece of legislation. A fee of only £1,000 suggests to me that their advice is not comprehensive (unless they gave the same advice to lots of people and just searched and replaced your name).

2. From 2017/18 you will not be able to rely on professional advice in certain circumstances. I've copied and pasted this from something Macfarlanes published on the Finance Bill (http://www.macfarlanes.com/media/715...e-measures.pdf).

The taxpayer will not be permitted to argue that he relied on any of the following categories of advice to show that he was not careless:
 advice from a person who facilitated the avoidance for a fee of any kind, participated in the avoidance arrangements, or from anyone with whom that person had an arrangement (unless the taxpayer took steps to establish this was not the case and reasonably believed it did not);
 advice given by a person without appropriate expertise (again unless the taxpayer took steps to establish that the advisor had appropriate expertise and reasonably believed he did);
 advice which did not take into account the taxpayer’s individual circumstances; or
 advice addressed to anyone apart from the taxpayer.

[eek]

Imagine?

As part of my day job I regularly see tax counsel, mostly QCs. I choose to go to those that I trust to give me a proper opinion. I rarely ask for their view on the technical points of tax law or the policy objectives of tax law as I, and the people I work with, are normally more competent in those areas than the average QC. I ask their opinion about how the courts will view those technical arguments. That is what they are particularly good at. I also make sure that I give them good, detailed instructions that properly set out the facts and the tax analysis.

I am absolutely certain that all of the QCs that I have seen in, say, the last seven years would not give me a favourable opinion of what you have described here (although much of what you have written is pretty vague).

Is there a QC out there who would give a favourable opinion? I can guess at a couple who would give a positive opinion on a narrow question based on a narrow set of facts. I would never pay for their opinion though as it would be of no use to my clients. As an aside, I saw one of these at a free conference about 15 month and his talk was pretty much a rant where he mentioned Hitler in the first five minutes.



There are two answers to this question:

1. If they gave you specific advice on your specific facts and the advice was comprehensive and they were competent to give that advice then you would normally be able to rely on that. But I don't know what you asked them, what they said / didn't say or whether they are competent to give that advice. You can test whether what they said was comprehensive by looking at what their letter said about: GAAR, DOTAS, the current state of the draft legislation / how it may change, and the attitude to the courts of what is proposed. If they didn't mention it or laughed it off then that's a good indicator that you can't rely on it. But that won't tell you if they are competent. And I'd bet money that the vast majority of accountancy firms are not competent to advice on this specific piece of legislation. A fee of only £1,000 suggests to me that their advice is not comprehensive (unless they gave the same advice to lots of people and just searched and replaced your name).

2. From 2017/18 you will not be able to rely on professional advice in certain circumstances. I've copied and pasted this from something Macfarlanes published on the Finance Bill (http://www.macfarlanes.com/media/715...e-measures.pdf).

By 2017/18 I take it to mean from April 6th 2017 when this tax year started?

[FakeHorizon]

I used to joke that a qc opinion was an alcoholic meal and anything where the qc kept a straight face was acceptable. Oh and the accountancy firm saw you coming

I'm not actually involved with the accountancy firm as such, having rejected their initial offering. But if I keep repeating that my choice at the moment is paying a 5% trust fee or paying 20% tax on my main loans, a decision I have still to make, will it ever sink in do you think? Does any of this impact you, out of interest?

[FakeHorizon]

Imagine?

As part of my day job I regularly see tax counsel, mostly QCs. I choose to go to those that I trust to give me a proper opinion. I rarely ask for their view on the technical points of tax law or the policy objectives of tax law as I, and the people I work with, are normally more competent in those areas than the average QC. I ask their opinion about how the courts will view those technical arguments. That is what they are particularly good at. I also make sure that I give them good, detailed instructions that properly set out the facts and the tax analysis.

I am absolutely certain that all of the QCs that I have seen in, say, the last seven years would not give me a favourable opinion of what you have described here (although much of what you have written is pretty vague).

Is there a QC out there who would give a favourable opinion? I can guess at a couple who would give a positive opinion on a narrow question based on a narrow set of facts. I would never pay for their opinion though as it would be of no use to my clients. As an aside, I saw one of these at a free conference about 15 month and his talk was pretty much a rant where he mentioned Hitler in the first five minutes.



There are two answers to this question:

1. If they gave you specific advice on your specific facts and the advice was comprehensive and they were competent to give that advice then you would normally be able to rely on that. But I don't know what you asked them, what they said / didn't say or whether they are competent to give that advice. You can test whether what they said was comprehensive by looking at what their letter said about: GAAR, DOTAS, the current state of the draft legislation / how it may change, and the attitude to the courts of what is proposed. If they didn't mention it or laughed it off then that's a good indicator that you can't rely on it. But that won't tell you if they are competent. And I'd bet money that the vast majority of accountancy firms are not competent to advice on this specific piece of legislation. A fee of only £1,000 suggests to me that their advice is not comprehensive (unless they gave the same advice to lots of people and just searched and replaced your name).

2. From 2017/18 you will not be able to rely on professional advice in certain circumstances. I've copied and pasted this from something Macfarlanes published on the Finance Bill (http://www.macfarlanes.com/media/715...e-measures.pdf).

What is being offered right now is an opportunity to settle loans as a result of the decision in the Rangers case. People can either do that or pay the full tax in 2019. I'm no legal expert but having tackled the draft legislation, I'm not seeing the requirement to notify hmrc of cleared loans. Care to name the section it's in? For my part, these loans will be gone one way or the other by 2019 so I'm not seeing where the loan charge legislation will be relevant. This concurs with advice already given, by someone I do think can be considered an expert. Not that I'm under any illusions but your armageddon scenarios are not something I'm going to worry about as what I have done so far is already with hmrc for consideration, as it will be for any number of others.

[me206et]

I'm not actually involved with the accountancy firm as such, having rejected their initial offering. But if I keep repeating that my choice at the moment is paying a 5% trust fee or paying 20% tax on my main loans, a decision I have still to make, will it ever sink in do you think? Does any of this impact you, out of interest?

I understand that if you pay it off now, with either 5%fee or 5% +2.5% bridging loan charge then the loan is cleared. But. It will be reported as it is passed 2016. So had to be reported. So no loan charge. But how do you get your money back. HRMC now know about it and will keep a very close eye on you to see what you do.
If you do not still have an income, and you can afford to keep the money in the trust can they pay you back over number of years? Will and/or can they do that?

[Iliketax]

I'm not seeing the requirement to notify hmrc of cleared loans. Care to name the section it's in?

Sure. The fourth condition of paragraph 35A, with the information required being set out in paragraph 35B. These will be put into Schedule 11 of what will become FA (No. 2) 2017 (or FA 2018), assuming both become law.

To help you:

DUTY TO PROVIDE LOAN CHARGE INFORMATION TO HMRC
Duty to provide loan charge information

(5) The fourth condition is that—

(a) none of the first, second and third conditions is met, and

(b) if the date specified in paragraph 1(1)(c) were 16 March 2016 and if paragraph 1(2) provided that a person who is treated as taking a relevant step by paragraph 1(1) is treated as taking that step immediately before the end of 16 March 2016—

(i) a person (“T”) would be treated as taking a relevant step within paragraph 1 immediately before the end of 16 March 2016, and
(ii) Chapter 2 of Part 7A of ITEPA 2003 would apply by reason of that relevant step (using, for this purpose, the law that would be used to test whether that Chapter applies to a relevant step taken on 5 April 2019), and

(c) T is living immediately before the end of 5 April 2019.

[Iliketax]

Does any of this impact you, out of interest?

Nope. I am not a contractor, I do not advise contractors, I don't work for HMRC and I am not trying to get paid work for posting on here. But people's behaviours to tax avoidance and tax evasion interest me so much that I plan to do a PhD in it.

In terms of the disguised remuneration legislation says, in the real world I believe am one of the leading experts in it. On here, I'm just a random stranger who makes boasts that you can either believe or not believe. That's entirely up to you.

[Iliketax]

What is being offered right now is an opportunity to settle loans as a result of the decision in the Rangers case.

I'm offering unicorns at £100 per gross as a result of the decision in the Rangers case. Just send the money by Western Union if you are interested.

[Iliketax]

By 2017/18 I take it to mean from April 6th 2017 when this tax year started?

Actually, it's a bit more complicated than that in that it applies for the 2017/18 tax year and onwards but only in relation to documents give from Royal Assent of the current Finance Bill - so that will probably be before the end of March 2018 (but who knows for sure).

[stonehenge]

So,

1) depreciated/written-off EBT loans are "reinstated", by the Trust, to their original GBP amounts

2) bridging finance, provided by another party, is used to pay off the EBT loans

What happens to the bridging loans? What about the money that is supposedly now sat back in the EBT? Will there be any real money transactions involved, or is it just bits of paper?

It all sounds very shaky to me.