HMRC enquiries for EBT schemes through SANZAR

[LisaContractorUmbrella]

Do you know what happens with the 13% Employers NIC in that situation?

This would seem to indicate that the charge could potentially be passed to the 'employee' DMBM570250 - Debt and return pursuit: miscellaneous charges: under-deductions of PAYE and NICs direct from employee

[MrO666]

A CTD is only a reasonable option if you believe you will ultimately have to cough up.

I agree entirely, however it never hurt to hedge your bets.......

[Naush187]

Why did I open that letter!!!

I agree entirely, however it never hurt to hedge your bets.......

Hi MrO666,

Literally got my letter this morning. Wasn't aware of any issue until the dreaded letter. I was pretty confused until spotting the word "Sanzar". Someone did warn me this may bite me in the butt. How do you put some away to the CTD? I would rather hedge my bets and stop any interest charges. I'm assuming this is a holding account (sorry I have just started looking into all this).

Also, I haven't come across anyone informing the group of the result of an appeal? Admittedly I haven't read each and every reply/thread. Can anyone share that experience? I have written to contractor helpdesk as my first port of call. and am awaiting advice. All the other things I have read stop at, we have appealed and awaiting to see HMRC's response. Also, I had read that there are standard appeal letters floating about...can anyone direct me?

Thanks,

Naush187

[DonkeyRhubarb]

This would seem to indicate that the charge could potentially be passed to the 'employee' DMBM570250 - Debt and return pursuit: miscellaneous charges: under-deductions of PAYE and NICs direct from employee

Unless I missed something, this only refers to employee's NICs.

[DonkeyRhubarb]

I agree entirely, however it never hurt to hedge your bets.......

Compare two scenarios. Assuming a liability of £100k, and say the tax dispute goes on for another 3 years.

CTD

Lose - pay £100k, no further interest

Win - get your £100k back

Saving/investment paying 2% net

Lose - HMRC liability £109k; investment worth £106k (worse off by £3k)

Win - better off by 6k

A drawback of CTD is that the money is tied up until the dispute is resolved. If you withdraw it then you lose any benefit of having it; you will owe the full amount of interest as though you never took out the CTD.

[convict]

Unless I missed something, this only refers to employee's NICs.

This is the one you want (or don't as the case may be)
INS8101 - Alternative rights of recovery: General

[DonkeyRhubarb]

This is the one you want (or don't as the case may be)
INS8101 - Alternative rights of recovery: General

It's probably not worth stressing about because HMRC are a very long way from being able to actually enforce any collection.

I still believe there's a good chance that this will be quietly dropped at some point, especially if they manage to collect enough through voluntary settlements.

Btw, I was picking apples in the garden yesterday and I was able to collect enough by going for the low hanging fruit and shaking the tree. I called it a day once I needed a ladder to reach the remaining apples. I'm sure you can see the analogy.

[MrO666]

I guess the argument is fairly clear that if (and that's a big if) HMRC can prove beyond any doubt in a tribunal / court that any money received by an individual was in fact income and not anything else, then it'll be time to take it on the chin and cough up.

Providing everybody appeals everything thing this is going to take HMRC a very long time and cost them a huge amount of money to do.

HMRC are stupid in some respects regarding all of this. They're chasing money (which they can't at present even prove is owed) from a number of people, many of which probably have no way of paying it, so what then......make them bankrupt and forfeit anything that they may potentially have got.

This is all hypothetical of course, but if HMRC where to take a more beneficial approach towards the taxpayer, then perhaps they would see more people making a voluntary settlement just to draw a line under it.

However as it stands anybody would be crazy to pay up, as HMRC are offering zero incentive to do so. The VERY worst that would happen would be that interest is applied to any money proved as owed, that's it. So why would somebody pay up now, may as well wait until the very last appeal has been exhausted and then if need be pay (and suck up the interest).............at which points it's cost HMRC an absolute fortune to get there.

HMRC are more than happy to cosy up to big business and agree to reduced settlements (errr.....Goldman Sachs for one), so why not the individual.

HMRC - if you're reading this.....you catch more flies with honey than vinegar.

[DonkeyRhubarb]

HMRC's hands are tied to some extent. They are straightjacketed by their own Litigation & Settlement Strategy (LSS), and they are being closely scrutinized by the NAO and PAC.

This makes it hard for them to be pragmatic, even if they wanted to be.

[samuel]

CM

Are we entitled from HMRC and/or CM to copies of correspondence between them?