Edge EBT thread

[Living life on the Edge]

I meant they would give me a figure of what they think I owe. Then clearly I will do my own sums. :-)

Then I think you will have a rude awakening to come. HMRC certainly: they will give you one for free - it's called an APN (or your accountant, maybe), but the established groups - no. Why would they be doing that? It is not in their remit.

[evildrome]

HMRC would probably make you take that to the FTT.

Even if you win they'd appeal to the UT, Court of Appeal, Supreme Court.

I have no objection to going to an FTT. What I object to is being asked to pay in advance on a premise that is founded on very slippery ground.

I think HMRC have scooped up everyone on a DOTAS scheme regardless of circumstance and are shaking the tree to see what falls out.

Its just laziness, pure & simple. "Whats that? Do my actual job? Shome mishtake shurely."

[squirrel]

I could be wrong but I think you've misunderstood parallelmonogamist's initial post

Then I think you will have a rude awakening to come. HMRC certainly: they will give you one for free - it's called an APN (or your accountant, maybe), but the established groups - no. Why would they be doing that? It is not in their remit.

The way I read it was not that he was going to ask either of the groups to do the calcs the "they" in his initial post, I think, was only referring to HMRC [doing the calc]...

[webberg]

The Edge discoveries should be invalidated.

No new info has come to light and everything has been declared.

At the risk of repeating myself, discovery does NOT require something new to come to light.

It is enough that another Inspector reviews the case and decides that the first decision was incorrect.

[webberg]

At the risk of repeating myself, discovery does NOT require something new to come to light.

It is enough that another Inspector reviews the case and decides that the first decision was incorrect.

At the end of the day unless this scheme is different from the others, HMRC has nowhere near information to make an educated guess at liability. This won't stop them but it is grounds for a representation against an APN.

[Dylan]

At the risk of repeating myself, discovery does NOT require something new to come to light.

It is enough that another Inspector reviews the case and decides that the first decision was incorrect.

If the hypothetical inspector had enough info for the first year I was in the scheme then it stands to reason in my mind that they also had enough info for the following two years, more so as you'd assume an open enquiry would be a massive red flag to see if circumstances had changed. Common sense doesn't come in to it though eh!

[webberg]

If the hypothetical inspector had enough info for the first year I was in the scheme then it stands to reason in my mind that they also had enough info for the following two years, more so as you'd assume an open enquiry would be a massive red flag to see if circumstances had changed. Common sense doesn't come in to it though eh!

Correct. Common sense was left dying in a gutter years ago.

About 10 years ago HMRC was a series of fiefdoms. Senior Inspectors pretty much ruled their patch and things got done. If you had done something that was frowned upon you had a long series of letters/emails and perhaps a meeting or two with the case officer. A deal was put on the table and the senior guy effectively became your advocate to HMRC Head Office.

Along comes Mr Hartnett. Allegedly he rode roughshod over procedure and wanted to get involved. He dealt with a number of high profile taxpayers and was apparently at one time the most wined and dined Civil Servant in a year. Ignoring the advice of his internal legal offices, he did a "sweetheart" deal with a bank. Details in any paper from them you care to name.

When this was "exposed" in the PAC by Ms Hodge, condemnation rained down on HMRC. Their reaction, aside from shifting Mr H out, was to bring a tight grip to bear on any "deals". Essentially all deals were banned on pain of getting the sack. This removed a lot of discretion from the senior inspectors, many of whom left.

Now all those decisions taken that a scheme was "good" or "Not that bad", were all reviewed and to nobody's surprise massive inconsistency was discovered.

To bring order, it was decided that the hardest line decision was the right one and it was applied across the board (not just contractors). Hence the "discovery" that something you thought was good is now not.

What you have now is a cadre of senior officers in HMRC (just count the number of "directors" in the Counter Avoidance Directorate) who have a nice salary and pension to protect and who are isolated from the effects of their decisions. Unlike the senior Inspectors of old who might see one of their "customers" (I really hate the use of that word by HMRC), in the pub, these senior people are unlikely to do that and so sleep easily.

Doesn't help that the short term (3 years) effect of this policy has been to increase revenues as the weak and helpless have been picked off. This has encouraged HMRC to publish harsh "settlement" offers.

We are perhaps now at a tipping point. The easily swayed have settled and moved on. Some of the high and ultra high net worth investors in film schemes are resisting and litigation and dispute counts are rising. Currently around 200 years - yes YEARS - worth of litigation is outstanding and rising.

The position of you guys is going to be pivotal. It is the first test of the HMRC policy against people who owe relatively low amounts to HMRC (even though it feels high to you) but there are thousands of you. The systems designed to deal with say 200/300 partners in a LLP are not going to work for thousands.

I have expounded elsewhere my views that it is a legitimate tactic at this time to resist and cause HMRC maximum cost for the tax they extract. This was not my original intent and not my original idea. Many of you guys got their before me and I needed to be convinced. Now I am. Only by squeezing HMRC as hard as they squeeze you will the balance be restored.

And hopefully common sense will rise like an avenging angel from the gutter and smite all those who put it there.

Well - I feel better for that.

[LandRover]

...time to resist and cause HMRC maximum cost for the tax they extract.

So when can this begin???

Send out template letters en masse?

Ask for detailed breakdowns of their estimate of alleged tax?

We need to clog up the system with administration and bring HMRC to their senses

[parallelmonogamist]

The way I read it was not that he was going to ask either of the groups to do the calcs the "they" in his initial post, I think, was only referring to HMRC [doing the calc]...

Indeed. I took from other discussions that if you ask HMRC "What's this settlement thing all about?" they'll give you a figure to start you off. At least that way I know how much to squirrel away before the APN arrives.

Correct me if I'm mistaken somehow.

[dangerouswhensober]

Indeed. I took from other discussions that if you ask HMRC "What's this settlement thing all about?" they'll give you a figure to start you off. At least that way I know how much to squirrel away before the APN arrives.

Correct me if I'm mistaken somehow.

You are correct - they will send you their calculation if you ask. It's also good to ask because it demonstrates that you are 'engaging' with HMRC - this could work in your favor in the future.

Below is an edited version of the letter I sent to get the HMRC calculation - remember to supply your own CLSO Enquiry Ref. And don't forget to put the 'Without Prejudice' - this means the your letter can't be used in court at a future date (for example by HMRC, trying to show you admitted liability).

Suggest you send the letter (and all other correspondence) by registered letter - so HMRC can't deny they received it.

BTW - You might have to wait a few weeks for a reply.

Good luck !

================================================== ========================================
HMRC Counter-Avoidance
PO Box 177
Bootle
L30 4TZ

15th October 2014

Dear Sirs

Re: Your Ref : CLSO Enquiry Ref XX-XX-999999


Without Prejudice

Thank you for your letter dated July 2014.

Please could you send me a personal calculation of tax and interest due under the settlement opportunity quoted in your letter.

Yours sincerely
================================================== ========================================