Hoey - Court of Appeal legal fees GoFundMe contributions have now been refunded

[luxCon]

Considering that the UT ruling has put HMRC on the backfoot, and has for the time being given the victims a breathing space I would have expected a bit more positivity than the usual negativity some people dish out on here. A little gratitude is due to those that pushed this through the Tribunal instead of sitting on their back sides.

According to the tax barrister Keith Gordon the ruling requires now HMRC to individually take each taxpayer to the county court, and the Tribunal has giving indication that the TP does not owe the PAYE tax.

If there is an appeal for funds I hope more people will help to help themselves.

[Saleos]

If you are talking about me - my pessimism was regarding the fact I suspected this would be the end of it and that no appeal would be possible nor required

and it looks like I was right

Eek is wrong again. At least he is consistent!

For those actually interested in helping themselves and others with pre-DR loans here is what Rory Mullan QC has said about the UT decision:

"HMRC have two alternative arguments on which they are basing their case as to the contractors liability to pay tax:

(i) The payments to the trust were employment income of contractors. That income did not qualify for a PAYE credit because HMRC lawfully exercised a discretion under section 684(7A)(b) ITEPA 2003; and

(ii) The contractors were liable to income tax under the Transfer of Assets Abroad (‘TOAA’) code. That income is not subject to the PAYE code and as such does not qualify for PAYE credit.

The consequence of the UT decision is that:

We should win on the first point. HMRC do not have power to exercise their discretion retrospectively and therefore cannot remove the entitlement to a PAYE
credit.

We win on the second point as the income of the person abroad is nil.

In substance this is a good outcome. The difficulty is the extent to which we can rely on it, and the extent to which HMRC will respect it.

In particular, the problem with our win on the first point is that the Upper Tribunal accepted HMRC’s argument that it did not in fact have jurisdiction to decide the point. Its views on the scope of the jurisdiction are therefore not binding and are only persuasive (although I would expect them to carry a lot of weight)".

Because the decision on the PAYE issues is persuasive rather than binding (because they were obiter) there is a need to take the case further to get a binding ruling. There are three possible routes - all end in the Court of Appeal.

Full details of the fund raising for that will be announced tomorrow. Firstly to clients and to those who had already contributed to the fight so far. Then, likely on Monday, more widely. But funds are already being accepted.

Hopefully the fact that contributions that were made via GoFundMe were returned as promised will give everyone comfort that those involved in helping, pro bono, Mr. Hoey keep their promises.

The facts are simple. An awful lot of money has been contributed to two legal fights which have failed (LCAG JR x 2) and another which hasn't materialised at all and is behind at least 3 other cases (Hoey, Higgs and Lancashire).

Higgs, which failed on the preliminary PAYE issues, is stayed behind Hoey. Lancashire (self employed partnership scheme) has a different fact pattern and findings on ToAA which are much less helpful than in Hoey. HMRC did not appeal the PAYE issues in Lancashire (which broadly took the same position as the UT re exercise of discretion being prospective only) and so only the (less helpful) ToAA point is to be heard by the UT.

Hoey is the leading case (in that it is first) and the only one that has made ground on both the ToAA AND PAYE issues. Other long promised litigation is nowhere to be seen.

These are facts and indisputable.

It is time for those with pre-DR (before 9 Dec 2010) loans to help themselves and each other. To come together and ensure that the one case making progress continues to do so. We have already reached out to those managing the other groups and are willing to work collaboratively with anyone with something meaningful to add. If you have already given your money to someone else perhaps it is time to ask they they use it differently.

Anyone who is NOT a member of the existing Penfolds & Hamilton Litigation Associations can contribute here on the same terms as before: gf.me/u/y7zudn

[regron]

Considering that the UT ruling has put HMRC on the backfoot, and has for the time being given the victims a breathing space I would have expected a bit more positivity than the usual negativity some people dish out on here. A little gratitude is due to those that pushed this through the Tribunal instead of sitting on their back sides.

According to the tax barrister Keith Gordon the ruling requires now HMRC to individually take each taxpayer to the county court, and the Tribunal has giving indication that the TP does not owe the PAYE tax.

If there is an appeal for funds I hope more people will help to help themselves.

I think a big issue is HMRC's long term 'Divide and Conquer' tactic which lets be honest, has worked a treat. They have created so many sub-levels through policy changes, new draconian laws which has made it impossible to fight on one front. This means people have to make decisions which unfortunatley, casues more friction (internally amongst those affected) and some back one horse, some back many. We are however at one of those pinnacle moments where people will have to make decisions again and without doubt where collaboration talks between various groups can only be a good thing.

[GoneSurfing]

You seem mis-informed.

(said as someone who has supported the Hoey case and is a WTT member).

Enlighten me then. Where did he criticise the approach/case rather than the behaviour?

[regron]

Enlighten me then. Where did he criticise the approach/case rather than the behaviour?

I'm not here to enlighten anyone, I just felt the need to balance the argument. I know there are ex members of each group who have left one or the other, or even both due to not being happy or for varying other reasons which of course, is their choice. By all means make that decision and move on, but people shouldn't be continuing to slag one or the other off in public, it helps nobody, ref my last post in response to 'Luxcon'.

[eek]

Enlighten me then. Where did he criticise the approach/case rather than the behaviour?

How about to try and see if there was any validity to the approach and the case.

and I would still ask the same question-

as I read things HMRC can’t enforce payment because they asked the wrong party and it’s too late for them to ask the correct party. If that is right what does going further actually achieve?

[Saleos]

How about to try and see if there was any validity to the approach and the case.

and I would still ask the same question-

as I read things HMRC can’t enforce payment because they asked the wrong party and it’s too late for them to ask the correct party. If that is right what does going further actually achieve?

Let me enlighten you Eek. Again. Before you misinform readers again.

The PAYE discretion & credit issues were obiter because HMRC succeeded (in a hollow victory that I suspect they will come to regret) in their arguments on Jurisdiction. So whilst persuasive the decision is not binding. And given HMRC's conduct only a fool would expect them to accept it.

For the few for whom HMRC has already exercised their discretion (like Mr Hoey) HMRC could thus sue for the tax in the County Court. That would be expensive (filing fees £10K for claims over £200K) and time consuming (claims have to be filed manually) when multiplied across many taxpayers. And of course Mr Hoey could point to the persuasive view of a Court of higher standing which says he owes nothing. But, again, not expecting HMRC to accept that they could appeal to the Court of Appeal. Where an appeal from the UT would go and where the JR we (but not Higgs) filed to protect the jurisdiction and PAYE arguments is currently sat. 3 routes to the same place. And as I said earlier the key is to get a binding ruling which HMRC cannot simply try to ignore.

For those for whom HMRC hasn't exercised their discretion HMRC has a further hurdle. That the UT has told them it cannot do so retrospectively. But again that is obiter. Does anyone expect them to honour that and that we should therefore sit on their hands as you suggest?

Or should readers perhaps prefer the view of Rory Mullan QC who says "Bearing in mind HMRC’s approach I do not think it would be sensible to simply sit on the
decision as it is at present".

[eek]

Let me enlighten you Eek. Again. Before you misinform readers again.

The PAYE discretion & credit issues were obiter because HMRC succeeded (in a hollow victory that I suspect they will come to regret) in their arguments on Jurisdiction. So whilst persuasive the decision is not binding. And given HMRC's conduct only a fool would expect them to accept it.

For the few for whom HMRC has already exercised their discretion (like Mr Hoey) HMRC could thus sue for the tax in the County Court. That would be expensive (filing fees £10K for claims over £200K) and time consuming (claims have to be filed manually) when multiplied across many taxpayers. And of course Mr Hoey could point to the persuasive view of a Court of higher standing which says he owes nothing. But, again, not expecting HMRC to accept that they could appeal to the Court of Appeal. Where an appeal from the UT would go and where the JR we (but not Higgs) filed to protect the jurisdiction and PAYE arguments is currently sat. 3 routes to the same place. And as I said earlier the key is to get a binding ruling which HMRC cannot simply try to ignore.

For those for whom HMRC hasn't exercised their discretion HMRC has a further hurdle. That the UT has told them it cannot do so retrospectively. But again that is obiter. Does anyone expect them to honour that and that we should therefore sit on their hands as you suggest?

Or should readers perhaps prefer the view of Rory Mullan QC who says "Bearing in mind HMRC’s approach I do not think it would be sensible to simply sit on the
decision as it is at present".

So basically, at this point, if HMRC were to seek payment all routes end up in the court of appeal so the best plan would be to go directly there now.

The only question then remaining is how likely do people think HMRC will seek payment and whether in doing so they could find an easier case to win. But given the second part of that sentence continuing makes a lot of sense as that results in a decision HMRC can’t abuse (and at this point they still could).

So finally given HMRCs divide and conquer approach what pre 2010 schemes are covered by the likely decision (as they are the people you need to convince) and my viewpoint has always been that you need to make and keep things simple (if your scheme did x or y or z the end result will impact you).

[TheDogsNads]

So basically, at this point, if HMRC were to seek payment all routes end up in the court of appeal so the best plan would be to go directly there now.

The clear flaw in your proposal is you cannot go direct to the Court of Appeal. The court system in the UK is hierarchical with in built filters. It requires the appellant to satisfy a more stringent test to obtain permission to appeal to each successive court.

[eek]

The clear flaw in your proposal is you cannot go direct to the Court of Appeal. The court system in the UK is hierarchical with in built filters. It requires the appellant to satisfy a more stringent test to obtain permission to appeal to each successive court.

Which part of "End up in the court of appeal" starts with you going straight there - the options are:-

1) Take the Hoey case to the Court of Appeal. As that is the next stage for the Hoey case given that this decision is from the Upper Tax Tribunal)
2) Wait HMRC to take a case to the County Court appeal the result to the High Court and watch that case go to the Court of Appeal.

Now were anyone in this case sane you would hope people would write everything off as a no win score draw but it's clear people don't think that HMRC will stop here so I can see why option 1 is the favourite.