HMRC Enquiry letters on Loans from EBT and other schemes

[Nissan07]

Contractor Loans Settlement Opportunity

The letter I received is stated 'Contractor Loans Settlement Opportunity' arrangements used up to April 20xx. This states it requires a response early next year.

It does state they will continue to tribunal if i don't respond

1. Is this the same letter everybody has received
2. Does this need appealing within 30 days
3. Can i confirm an accountant is my first port of call
4. How do I get involved in an action group

[Living life on the Edge]

The letter I received is stated 'Contractor Loans Settlement Opportunity' arrangements used up to April 20xx. This states it requires a response early next year.

It does state they will continue to tribunal if i don't respond

1. Is this the same letter everybody has received
2. Does this need appealing within 30 days
3. Can i confirm an accountant is my first port of call
4. How do I get involved in an action group

1. It seems so
2. No, there is nothing for you to appeal
3. Your choice, but what is an accountant going to do for you?
4. Depending on your EBT, you may find that a group already exists...check out the other threads under 'HMRC Scheme Enquiries'

[Not Losing Any Sleep]

1. It seems so
2. No, there is nothing for you to appeal
3. Your choice, but what is an accountant going to do for you?
4. Depending on your EBT, you may find that a group already exists...check out the other threads under 'HMRC Scheme Enquiries'

If you are looking to take on HMRC on anything relating to an EBT there is one team out there worth using - Paul Baxendale Walker and Andrew Thornhill. Someone is going to have to organise you all which will be a tall order. Good luck.

[Poppy]

PM rights please

PM rights please

[Boobetty]

eek would you know how IHT is involved with EBT. It is only recently HMRC has started talking about IHT. It was not raised in AAM case which was offshore EBT and neither in Rangers which was onshore EBT.

I am intrigued with this question too. As far as I can ascertain, IHT can arise where the taxpayer pays cash or other assets into a trust. The threshold is £325k and applies on a cumulative basis to the last seven years of transfers. Once this threshold is reached, an IHT liability of 20% applies to all subsequent transfers.

The issue really is that the IHT Act 1984 specifies that where there has been a waiver of remuneration, this does not qualify as a 'transfer of value' and hence IHT is not payable.

In contractor loan arrangements it may be possible to argue that we haven't in fact settled anything into the trust but instead we have waived remuneration. Unfortunately, even If we can successfully argue this we have another hurdle: we need to demonstrate that our offshore employer has not gained any tax relief from the amount of the remuneration waived.

I am not certain about how any of this will apply in practise to be honest, but interesting all the same.

I should also add that in addition to the 20% 'entry' tax there is also an exit charge, which is based on a time-related sliding scale starting at 6% and dropping to zero. Basically, every ten years a trust must pay 6% of the value of the assets it holds. However, in our cases, the age of the trusts is much less than 10 years so the IHT charge is far less significant.

Again I do not know enough about the trusts we used to form an opinion on an expected liability but it makes interesting reading.

For what it is worth, I have emailed HMRC asking for some clarity on the subject of IHT, raising the questions above. If by some miracle I get a substantive reply that isn't penned by the usual hMRC cretin I will pass this info on.

[rocktronAMP]

Just Received a HMRC Contractor Loans Settlement Opportunity



I just received a HMRC CLSO letter today about arrangements used up 5 April 2011.

I contracted through a umbrella company called [REDACTED] after getting a start in contracting in 2003. After a couple of years I then moved to Kinsella Solutions.

Because of the dearth of IT banking gigs when the economy started to stagnate to the end of 2007, I eventually left contracting in 2008 when I joined an investment bank as permanent employee.

What do I do now? I had a very bad 2011 just looking for any sort of banking permanent work, I was not interested in contracting again until 2013. My war chest was severely depleted in 2011.

[Bishop99]

Time limitations

My letter arrived this morning.
I found the tone of the letter and Q&A very bullish - as if HMRC has never lost a case.

But what I found most extraordinary was the timescales this has all taken.
I only used a scheme (Assignment Solutions IOM), for a very short time in 2007 and from memory received just a single loan payment.
My tax return stated as much and that the company providing the loan had subsequently gone into administration.
The tax return for that year was filed in June 2007.
I got a COP8 letter in January 2009 which stated they "did not intend asking further questions at this time" (and never have done) and that "I will let you know if I find anything wrong".
I have had no further correspondence about this COP8 and intend calling them on Monday morning.

I assume the Settlement Opportunity letter relates to this enquiry but it doesn't even mention a particular tax year.

How can they take 5 and 1/2 years with no correspondence and then this? Is there no time limit after opening the COP8 (if so it looks like they just did that to give themselves an indefinite period to look into things - is that what is meant by "I am opening this enquiry to protect the interests of HMRC")?

Like you, I received a settlement opportunity letter which is not specific to a particular tax year. I also used ASIOM.

I called hmrc when I received the settlement opp letter and asked them what I owed which was how their letter was worded. They indicated that it was for a specific tax year and I asked them whether time limitations on raising an enquiry would apply - they were evasive on this and claimed they had sent me a letter in the requisite 12 months. I denied receiving this and asked them to send me a copy - they said they couldn't find it but would look further.

I subsequently found a cop8 letter just like yours - had forgotten about it because it said no info was required and they would write again when closer to resolution or if enquiries do not progress issue satisfactorily. Nothing heard in 4 years. It will be interesting to see if they can find the letter but I too would like to know whether a cop8 gives them an indefinite period for re-opening assessments?

Also, in my case, I used the ASIOM scheme in the tax year prior to the cop8 latter, but no enquiry raised on that year. The form hmrc want us to fill in seems to require disclosure of any tax years even where they are out of time to raise an enquiry - feel a bit like trawling to me.

[crystalmais]

Just Received a HMRC Contractor Loans Settlement Opportunity

My Wife has received the letter this morning. She was part of the Sanzar scheme at that time and was then part of Garraway scheme until she left it and went ltd at the end of 2013.

What is the best course of action? Any thoughts?

[TonyTucker]

Am I right in thinking that HMRC can only issue APN's against open enquiries / DA's?

If I have a return that's now outside the window (ie 6 years) then, in theory, they can't check this?

[Suet]

Assignment Solutions IOM

PM rights please?

I used this scheme and would be interested if anyone wants to form a group to challenge HMRC's actions or Tenon who administered the scheme.