HMRC Enquiry letters on Loans from EBT and other schemes

[DonkeyRhubarb]

The EBT Settlement Opportunity ends 30 June 2015, not March.

I'm always a bit suspicious of new posters.

And with a name "I like tax". Sounds like a windup merchant.

[cojak]

The EBT Settlement Opportunity ends 30 June 2015, not March.

I'm always a bit suspicious of new posters.

And with a name "I like tax". Sounds like a windup merchant.

It hasn't escaped my notice DR...

[z4thras]

this makes interesting reading http://www.taxbar.com/Every_Second_C...ICs_MJ.pdf.pdf

... It is not a tax, we are told, but a “contribution”;
and in line with that stance HMRC appears to accept that National Insurance is not “a tax
or duty” within the meaning of section 37(2)(a).

[carling]

I have no intention to wind anyone up. I do do tax for a living though and I'm passionate about it. And I'm good at it (but not modest). I have little to do with contractors' tax but I was looking for something work-related while getting my car MOT-ed and google came up with this site. I then had a look through some of the threads and thought I'd contribute something.

Looking at some comments since I first posted:

1. I can't see that it matters, from the perspective of APN whether, NIC is a contribution or a tax. The NIC bill says that the APN / FN FA2014 provisions apply to NIC.

2. I've not read the NIC Bill from cover to cover and I didn't look at it for APN reasons - I was looking for an amendment to deal with the new DIMF rules but noticed it was covered.

3. The EBT Settlement Opportunity is not something that I deal with for a living. But for it to apply the intention to settle has to be given by 31 March, with payment made by 31 July. 30 June is not relevant to that.

4. "Also I believe that in the bill mentioned, anti-avoidance measures apply to arrangements entered into after April 2014". That's not right. There is a provision that says that the APN/FN rules apply two months after Royal Assent. The government and the OBR says that including NIC's in the FN/APN regime will raise £165m in 2015/16. That's a lot of money. And its not going to come from people who did film schemes.

5. "It is highly unlikely that HMRC would try and apply NICs to EBTs - HMRC can't even get to a consistent point on IHT - NICS would be a nightmare - who pays what?". HMRC have got themselves into a muddle with IHT - how they square what their saying with legislation and Nelson Dance is beyond me. But they are clear on NIC and the legislation is clear that in this context if something is 'earnings' for s62 then it is also 'earnings' for NIC purposes. As for who pays what, the obligation to pay NIC is that of the employer (not the trust).

6. For what it's worth, my experience is that larger companies are using the EBT settlement opportunity. I have no idea what is happening with contractors though.

My biggest surprise from looking through some of these threads this morning is that people don't realise that they have done 'grown up' tax planning and that comes with lots of risks. But if I start talking about that I will get accused of being a windup merchant.

Ok, I think I understand what you are saying.
I thought that you were trying to say that the bill retrospectively changed the way NIC would be dealt with for people who had entered into EBT arrangements (some a decade ago) by way of the retrospective DOTAS APN legislation.

[centurian]

My biggest surprise from looking through some of these threads this morning is that people don't realise that they have done 'grown up' tax planning and that comes with lots of risks. But if I start talking about that I will get accused of being a windup merchant.

Probably - welcome though..

However that shouldn't be the biggest surprise - it should be the amount of contractors that, despite all this, are still engaging in these schemes

[DonkeyRhubarb]

3. The EBT Settlement Opportunity is not something that I deal with for a living. But for it to apply the intention to settle has to be given by 31 March, with payment made by 31 July. 30 June is not relevant to that.

Don't know where you're getting that information from.

https://www.gov.uk/government/public...information--2

"It was originally planned to be open until 9 January 2015. We have now extended the closing date to 30 June 2015. By that date we would expect people wanting to take part to have contacted us and be discussing possible settlement, which should be agreed by 30 September 2015 at the latest."

[turbowoowoo]

I have no intention to wind anyone up. I do do tax for a living though and I'm passionate about it. And I'm good at it (but not modest). I have little to do with contractors' tax but I was looking for something work-related while getting my car MOT-ed and google came up with this site. I then had a look through some of the threads and thought I'd contribute something.

Looking at some comments since I first posted:

1. I can't see that it matters, from the perspective of APN whether, NIC is a contribution or a tax. The NIC bill says that the APN / FN FA2014 provisions apply to NIC.

2. I've not read the NIC Bill from cover to cover and I didn't look at it for APN reasons - I was looking for an amendment to deal with the new DIMF rules but noticed it was covered.

3. The EBT Settlement Opportunity is not something that I deal with for a living. But for it to apply the intention to settle has to be given by 31 March, with payment made by 31 July. 30 June is not relevant to that.

4. "Also I believe that in the bill mentioned, anti-avoidance measures apply to arrangements entered into after April 2014". That's not right. There is a provision that says that the APN/FN rules apply two months after Royal Assent. The government and the OBR says that including NIC's in the FN/APN regime will raise £165m in 2015/16. That's a lot of money. And its not going to come from people who did film schemes.

5. "It is highly unlikely that HMRC would try and apply NICs to EBTs - HMRC can't even get to a consistent point on IHT - NICS would be a nightmare - who pays what?". HMRC have got themselves into a muddle with IHT - how they square what their saying with legislation and Nelson Dance is beyond me. But they are clear on NIC and the legislation is clear that in this context if something is 'earnings' for s62 then it is also 'earnings' for NIC purposes. As for who pays what, the obligation to pay NIC is that of the employer (not the trust).

6. For what it's worth, my experience is that larger companies are using the EBT settlement opportunity. I have no idea what is happening with contractors though.

My biggest surprise from looking through some of these threads this morning is that people don't realise that they have done 'grown up' tax planning and that comes with lots of risks. But if I start talking about that I will get accused of being a windup merchant.

So, sounds like you are not familiar with the forum and/or the contractor EBT schemes, yet you make statements ?

I find this a very un professional approach ?

Welcome to the forum, but do take time to understand the subject first.

[pnr8uk]

Great tax advisor

Hi All

I am in two boats right now one with Sanzar - handled very well by Contractor Helpdesk and Cobham Murphy.

The second boat heading for choppy waters is Garraway - I took professional tax advice as I wasn't really getting any response from Garraway or Contractor Helpdesk this time around, they may help but I couldn't wait.

I would highly recommend Gilbert Tax Lawyers (Tony Dickinson) - really brilliant and has promised to pool pay if he gets a few of us together. He has already work very hard with HMRC already, reducing the huge list of ridiculous 'fishing' questions down to just a handful.

Go with Tony and Gilbert if your provider has left you high and dry

[cliffordthedog]

Ehhh!

Hi All

I am in two boats right now one with Sanzar - handled very well by Contractor Helpdesk and Cobham Murphy.

The second boat heading for choppy waters is Garraway - I took professional tax advice as I wasn't really getting any response from Garraway or Contractor Helpdesk this time around, they may help but I couldn't wait.

I would highly recommend Gilbert Tax Lawyers (Tony Dickinson) - really brilliant and has promised to pool pay if he gets a few of us together. He has already work very hard with HMRC already, reducing the huge list of ridiculous 'fishing' questions down to just a handful.

Go with Tony and Gilbert if your provider has left you high and dry

I thought Sanzar had become Garraway and now Garraway Consultants!!

So why the difference?

[Old Kent Road]

Gilbert

I would highly recommend Gilbert Tax Lawyers (Tony Dickinson) - really brilliant and has promised to pool pay if he gets a few of us together. He has already work very hard with HMRC already, reducing the huge list of ridiculous 'fishing' questions down to just a handful.

Go with Tony and Gilbert if your provider has left you high and dry

A very positive recommendation. In fact, suspiciously so for a first poster...

If you are a genuine scheme or ex scheme user can I ask why you haven't joined the private garraway group? As you refer to pooling funds.