Edge EBT thread

[Talgarth]

Thanks. Sounds like good advice.

[Krung Thep]

IN order for an APN to be issued, there needs to be an open year AND a DOTAS number.

Can you just clarify that Rob because on another thread dated 30th September:

Not quite correct (being pedantic).

If the scheme has no DOTAS number, HMRC can still issue a FN and then an APN without resorting to GAAR.

Your latest statement is at odds with your earlier statement.

[Rob79]

Can you just clarify that Rob because on another thread dated 30th September:



Your latest statement is at odds with your earlier statement.

Context is everything, but apologies for the apparent conflict.

Most (certainly ALL the initial wave) of APN's will fall into the "open year + DOTAS number" category.

The second wave will fall into the "FN + open year + APN" category. This is because some early schemes did not have DOTAS numbers and until HMRC get a decision that sticks and which will form the basis of an FN, they can't issue an APN.

Sorry for any confusion but as I said, context is everything.

[Krung Thep]

Context is everything, but apologies for the apparent conflict.

Most (certainly ALL the initial wave) of APN's will fall into the "open year + DOTAS number" category.

The second wave will fall into the "FN + open year + APN" category. This is because some early schemes did not have DOTAS numbers and until HMRC get a decision that sticks and which will form the basis of an FN, they can't issue an APN.

Sorry for any confusion but as I said, context is everything.

Thanks for clarification Rob but things still aren't clear given what you've said, certainly not in my circumstances.

I don't believe the scheme I was in (TRM) ever had a DOTAS number so it sounds like I'd potentially be hit in the second wave of APN's although you've stated 3 distinct conditions for this to happen "FN + open year + APN". Is it in that particular order? I've only got an open year issued under discovery assessment so I'm not sure how a Follower Notice would fit in with that sequence.

Also, HMRC have already written to me offering a settlement opportunity to be taken up by January 9th 2015 and if I don't take it up they'll issue an APN. No mention of a Follower Notice and you've said they can't issue an APN without one.

When you say "a decision that sticks", do you mean a case that HMRC has already won at tribunal such as Boyle?

[Rob79]

Thanks for clarification Rob things still aren't clear given what you've said, certainly not in my circumstances.

I don't believe the scheme I was in (TRM) ever had a DOTAS number so it sounds like I'd potentially be hit in the second wave of APN's although you've stated 3 distinct conditions for this to happen "FN + open year + APN". Is it in that particular order? I've only got a open year issued under discovery assessment so I'm not sure how a Follower Notice would fit in with that sequence.

Also, HMRC have already written to me offering a settlement opportunity to be taken up by January 9th 2015 and if I don't take it up they'll issue an APN. No mention of a Follower Notice and you've said they can't issue an APN without one.

When you say "a decision that sticks", do you mean a case that HMRC has already won at tribunal such as Boyle?

I'll take these in reverse order.

A decision that sticks is a Court decision that becomes final (no appeal made or accepted) and which HMRC considers can apply to a large number of other claims for relief. My opinion is that Boyle is too limited in its facts to be applied widely. Whether that is HMRC's opinion or not remains to be seen.

If your scheme has no DOTAS number, then if you don't accept the settlement, you will not get an APN unless and until HMRC issues a FN.

My formula should perhaps have read FN + open year = APN.

Clearer?

[Krung Thep]

I'll take these in reverse order.

A decision that sticks is a Court decision that becomes final (no appeal made or accepted) and which HMRC considers can apply to a large number of other claims for relief. My opinion is that Boyle is too limited in its facts to be applied widely. Whether that is HMRC's opinion or not remains to be seen.

If your scheme has no DOTAS number, then if you don't accept the settlement, you will not get an APN unless and until HMRC issues a FN.

My formula should perhaps have read FN + open year = APN.

Clearer?

Yes that's clearer thank you Rob. It seems to fit in with what I've just discovered from a law website:

What should a taxpayer do if it receives a follower notice?

A taxpayer who receives a follower notice has two options. First, it can make representations to HMRC to the effect
that:

• the conditions for service of a notice have not been met; or
• the judicial ruling on which HMRC is relying is not relevant to the taxpayer’s arrangements; or
• HMRC is out of time (a follower notice cannot be served more than 12 months after the later of (i) submission of the relevant tax year and (ii) the date of the judicial ruling).

When can an accelerated payment notice be served?

An accelerated payment notice can be served in conjunction with a follower notice. Alternatively, an accelerated payment notice can be served on a standalone basis if either:

(i) the taxpayer has taken part in a transaction which has been notified to HMRC under the Disclosure of Tax Avoidance Scheme (DOTAS) rules or
(ii) a counteraction notice has been issued under the general anti-abuse rule (GAAR) and at least two members of the GAAR advisory panel have confirmed that entering into the tax arrangements was not a reasonable course of action.

My tax year in question is 2008/09 and the Boyle case was concluded at tribunal in mid December 2013 so if I'm not mistaken, HMRC have to issue me with a Follower notice by mid December at the latest or a counteraction under GAAR in order to issue me with an APN. Does that make sense?

[Rob79]

Yes that's clearer thank you Rob. It seems to fit in with what I've just discovered from a law website:

What should a taxpayer do if it receives a follower notice?

A taxpayer who receives a follower notice has two options. First, it can make representations to HMRC to the effect
that:

• the conditions for service of a notice have not been met; or
• the judicial ruling on which HMRC is relying is not relevant to the taxpayer’s arrangements; or
• HMRC is out of time (a follower notice cannot be served more than 12 months after the later of (i) submission of the relevant tax year and (ii) the date of the judicial ruling).

When can an accelerated payment notice be served?

An accelerated payment notice can be served in conjunction with a follower notice. Alternatively, an accelerated payment notice can be served on a standalone basis if either:

(i) the taxpayer has taken part in a transaction which has been notified to HMRC under the Disclosure of Tax Avoidance Scheme (DOTAS) rules or
(ii) a counteraction notice has been issued under the general anti-abuse rule (GAAR) and at least two members of the GAAR advisory panel have confirmed that entering into the tax arrangements was not a reasonable course of action.

My tax year in question is 2008/09 and the Boyle case was concluded at tribunal in mid December 2013 so if I'm not mistaken, HMRC have to issue me with a Follower notice by mid December at the latest or a counteraction under GAAR in order to issue me with an APN. Does that make sense?

I think that timing is correct.

It might be argued that the 12 month timing starts from the end of the appeal period for the base case. That would be between 30 and 42 days (normally) from the final decision. If that is the case, it might stretch the notice period to mid January (oddly, quite close to the settlement deadline!)

[Krung Thep]

I think that timing is correct.

It might be argued that the 12 month timing starts from the end of the appeal period for the base case. That would be between 30 and 42 days (normally) from the final decision. If that is the case, it might stretch the notice period to mid January (oddly, quite close to the settlement deadline!)

In that case it makes sense for me to wait until the last moment of the settlement opportunity window and gamble on HMRC not issuing me with a FN under the conditions and time frame stated. If they don't issue a FN by then I'm assuming I'm in the clear, certainly as far as an APN is concerned?

I don't believe there is any other avenue for HMRC to claw back their tax assessment figure is there, other than starting a tribunal case on the said scheme?

[Rob79]

In that case it makes sense for me to wait until the last moment of the settlement opportunity window and gamble on HMRC not issuing me with a FN under the conditions and time frame stated. If they don't issue a FN by then I'm assuming I'm in the clear, certainly as far as an APN is concerned?

I don't believe there is any other avenue for HMRC to claw back their tax assessment figure is there, other than starting a tribunal case on the said scheme?

A qualified "I agree".

A tribunal case is probably already being prepared and may be close to launch.

[TheDandy]

In that case it makes sense for me to wait until the last moment of the settlement opportunity window and gamble on HMRC not issuing me with a FN under the conditions and time frame stated. If they don't issue a FN by then I'm assuming I'm in the clear, certainly as far as an APN is concerned?

I don't believe there is any other avenue for HMRC to claw back their tax assessment figure is there, other than starting a tribunal case on the said scheme?

Why would you be in the clear as far as an APN is concerned?