Sympathy for the Devil

[difficulttimes]

Hi Phil,


The issue with the settlement opportunity is that because I would be voluntarily paying tax, I am effectively pleading guilty to being a tax avoider (without any proof from HMRC, I must add) and would never see that money again under any circumstance.

Sorry, pleading guilty to being a tax avoider?? Well didn't you avoid tax through what was probably a legal loophole at the time? and then why be concerned about being called a tax avoider?
It's not a criminal offence last time I checked so there is not pleading guilty.

It's called voluntary restitution and HMRC will gladly take your money and you walk away.

[phil@pmtc]

Hi Phil,

Could the tax paid under the 2019 legislation be refunded if that legislation was challenged and overturned in the future?

The issue with the settlement opportunity is that because I would be voluntarily paying tax, I am effectively pleading guilty to being a tax avoider (without any proof from HMRC, I must add) and would never see that money again under any circumstance.

Hi

We are probably in danger of straying into legal ground which I'm in no way qualified to provide advise tbh, but as far as I'm aware the answer is 'no' as settlement is different in that it specifically doesn't 'declare' anything other than an agreement to 'settle' without having to agree facts around the underlying enquiry. The difference to the APN refund to which I referred is that the APN payments were not an agreement between 2 parties a the recipients simply had to pay them whether they liked it or not. Therefore once they were found to be invalid a repayment was required. With a settlement its over at the signing of the deeds irrelevant of future findings. I suppose if you didn't settle and simply allowed the LC to kick In and then later the LC was found to be illegal then I would expect a refund at that stage.

Hope that makes sense, I'm a little tired no so perhaps waffling somewhat.

[BrownOwl]

Hi

We are probably in danger of straying into legal ground which I'm in no way qualified to provide advise tbh, but as far as I'm aware the answer is 'no' as settlement is different in that it specifically doesn't 'declare' anything other than an agreement to 'settle' without having to agree facts around the underlying enquiry. The difference to the APN refund to which I referred is that the APN payments were not an agreement between 2 parties a the recipients simply had to pay them whether they liked it or not. Therefore once they were found to be invalid a repayment was required. With a settlement its over at the signing of the deeds irrelevant of future findings. I suppose if you didn't settle and simply allowed the LC to kick In and then later the LC was found to be illegal then I would expect a refund at that stage.

Hope that makes sense, I'm a little tired no so perhaps waffling somewhat.

Not waffling at all, thanks once again for clarifying.

It sounds like APNs and the 2019 legislation at least have a chance of a refund if HMRC/Government are found to be incorrect legally.

With settlement opportunities (depending on the deeds, of course) that money is lost forever even if HMRC/Government are found to be incorrect legally.

It's quite the gamble for anyone settling as most of these schemes have never been tested in a court. HMRC generally pick easy wins to maintain their "only lose 1 in 5 cases" record so even that statistic is skewed from reality.

More thinking required, it's a shame the settlement terms are so bad as most people, I feel, would have settled on more reasonable terms.

[Iliketax]

More thinking required

Have you thought about tax rates? Let's say it is one in a thousand that the April 2019 loan charge will disappear because of a challenge (and I personally think that is hugely over-stating the chance). What are the chances that there will be an election and a Labour government will substantially increase the highest rates of income tax for 2018/19? One in ten?

[BrownOwl]

Have you thought about tax rates? Let's say it is one in a thousand that the April 2019 loan charge will disappear because of a challenge (and I personally think that is hugely over-stating the chance). What are the chances that there will be an election and a Labour government will substantially increase the highest rates of income tax for 2018/19? One in ten?

I don't know to be honest, I can't imagine anyone does.

Maybe the same chances as Jacob Rees-Mogg or Boris Johnson winning a Conservative leadership contest and lowering the income tax rates in 2018/19, as a wild guess.

[phil@pmtc]

Not waffling at all, thanks once again for clarifying.

It sounds like APNs and the 2019 legislation at least have a chance of a refund if HMRC/Government are found to be incorrect legally.

With settlement opportunities (depending on the deeds, of course) that money is lost forever even if HMRC/Government are found to be incorrect legally.

It's quite the gamble for anyone settling as most of these schemes have never been tested in a court. HMRC generally pick easy wins to maintain their "only lose 1 in 5 cases" record so even that statistic is skewed from reality.

More thinking required, it's a shame the settlement terms are so bad as most people, I feel, would have settled on more reasonable terms.

I agree, its a real shame that imo the settlement doesn't even meet my definition of the word 'settlement'. Its basically 'pay what HMRC want' and anything (as in my services) I offer is to make sure that they don't completely abuse that position and my clients get whatever the best possible outcome is. However if HMRC had said "ok pay 80% and that's the end of it" then I suspect majority would snap their hands off.

[BrownOwl]

I agree, its a real shame that imo the settlement doesn't even meet my definition of the word 'settlement'. Its basically 'pay what HMRC want' and anything (as in my services) I offer is to make sure that they don't completely abuse that position and my clients get whatever the best possible outcome is. However if HMRC had said "ok pay 80% and that's the end of it" then I suspect majority would snap their hands off.

Indeed, I think a specialist would be needed if I ever go near the settlement opportunity as, sadly, HMRC can't even be trusted to rip people off in a fair and consistent manner.

I hope the 80% is a typo as that's slightly worse than HMRC's current settlement opportunity terms!

[phil@pmtc]

Indeed, I think a specialist would be needed if I ever go near the settlement opportunity as, sadly, HMRC can't even be trusted to rip people off in a fair and consistent manner.

I hope the 80% is a typo as that's slightly worse than HMRC's current settlement opportunity terms!

haha I meant 80% of what they are currently asking for!

[Invisiblehand]

Maybe the same chances as Jacob Rees-Mogg or Boris Johnson winning a Conservative leadership contest

Mogg's 6's at the bookies.

#Moggmentum

[MyxALot]

I agree, its a real shame that imo the settlement doesn't even meet my definition of the word 'settlement'. Its basically 'pay what HMRC want' and anything (as in my services) I offer is to make sure that they don't completely abuse that position and my clients get whatever the best possible outcome is. However if HMRC had said "ok pay 80% and that's the end of it" then I suspect majority would snap their hands off.

I think everyone agrees that CLSO2 is a complete mess (or monumental sh1tshow to be precise) but given it comes from HMRC that's of no surprise to anyone.

A golden opportunity missed and another glorious own goal.