Edge EBT thread

[jbryce]

Saw my MP

Treasury Committee publishes report on 2014 Budget - News from Parliament - UK Parliament

So, had an initial chat with my MP and will have a follow up later this week. His, personal, view is that the powers which are to be granted to HMRC are unacceptable and there needs to a clean separation between the courts and the executive. The retrospective angle he said is outrageous, especially the hypothetical case of someone bankrupted and then found to have a winning position in court. As he said, if HMRC really win 80% of their cases they should concentrate on getting through their backlog. There is a possibility that the 20% they lose will see individuals bankrupted needlessly. I also made the point that HMRC do not pursue all the cases so the 80% figure maybe skewed. He agreed.

He also had a rant about Gary Barlow, but made the point that it was tried in a court, and Barlow lost. He had his day under due process. He isn't a fan of any form of avoidance - he thinks we should all be PAYE - but he believes that HMRC should get more funding to put cases in front of the courts rather than adopting powers themselves.

He's a relatively junior MP (Lab.) so he needs to get the party steer on it - I'm going to catch up with him later this week.

[swhitehe]

So, had an initial chat with my MP and will have a follow up later this week. His, personal, view is that the powers which are to be granted to HMRC are unacceptable and there needs to a clean separation between the courts and the executive. The retrospective angle he said is outrageous, especially the hypothetical case of someone bankrupted and then found to have a winning position in court. As he said, if HMRC really win 80% of their cases they should concentrate on getting through their backlog. There is a possibility that the 20% they lose will see individuals bankrupted needlessly. I also made the point that HMRC do not pursue all the cases so the 80% figure maybe skewed. He agreed.

He also had a rant about Gary Barlow, but made the point that it was tried in a court, and Barlow lost. He had his day under due process. He isn't a fan of any form of avoidance - he thinks we should all be PAYE - but he believes that HMRC should get more funding to put cases in front of the courts rather than adopting powers themselves.

He's a relatively junior MP (Lab.) so he needs to get the party steer on it - I'm going to catch up with him later this week.

I know there's probably a straightforward answer and this is probably not the right thread, but if we are all to be taxed as PAYE as HMRC wants - i.e as employees, then will HMRC be returning all the VAT paid to the hiring companies, as I'm not aware VAT is payable on employees. Or do they want both the VAT payment AND full PAYE? Is there a precedent for this elsewhere?

[LisaContractorUmbrella]

I know there's probably a straightforward answer and this is probably not the right thread, but if we are all to be taxed as PAYE as HMRC wants - i.e as employees, then will HMRC be returning all the VAT paid to the hiring companies, as I'm not aware VAT is payable on employees. Or do they want both the VAT payment AND full PAYE? Is there a precedent for this elsewhere?

This may be of interest HM Revenue & Customs

[ASB]

I think it is really hard to ascertain how sucessful HMRC are in court. I haven't really got any way of figuring out what the number mght really be - and hmrc sure as heck won't be letting on.

Consider that thy only go to court when then believe victory is near certain, then they lose 20% of them. That's a lot with those metrics.

How many do they negotiate settlement on?

How many does the taxpayer say "do one" then they back down?

In effect they seem to win 80% of that very limited subset they think is almost certain victory.

There was also an absolutely outrageous statement made by HMRC to the bbc in Barlows case:-

An HMRC spokesman told the BBC that "anyone using a scheme that HMRC deems to be against the rules owes them money".

So, the new arbiter is no longer anything to do with what the legislation may say? HMRC have set out their stall very clearly. Executive powers to be judge, jury and executioner is what they believe they are due.

[DonkeyRhubarb]

HMRC Litigation & Settlement Strategy

Arguably, the 80% success rate is meaningless...

http://www.hmrc.gov.uk/practitioners/lss.pdf

"Where HMRC believes that it is unlikely to succeed in litigation it will, in the majority of cases, concede the issue."

[jbryce]

I know there's probably a straightforward answer and this is probably not the right thread, but if we are all to be taxed as PAYE as HMRC wants - i.e as employees, then will HMRC be returning all the VAT paid to the hiring companies, as I'm not aware VAT is payable on employees. Or do they want both the VAT payment AND full PAYE? Is there a precedent for this elsewhere?

....I think the point he was making is that HMRC rules need to be clearer in the future, he was not suggesting that PAYE be applied retrospectively.
Of course, if HMRC do get these powers then it may be a portal to who knows what next....

[jbryce]

Arguably, the 80% success rate is meaningless...

http://www.hmrc.gov.uk/practitioners/lss.pdf

"Where HMRC believes that it is unlikely to succeed in litigation it will, in the majority of cases, concede the issue."

...be interesting to know the ones they dumped.

[varunksingh]

and it is on our website

https://www.dotas-scandal.org/what-i...ill-committee/

[DonkeyRhubarb]

...be interesting to know the ones they dumped.

I suspect the reason the backlog of open cases involving schemes has reached such dizzying heights is that they haven't been dumping enough.

It is one thing to have a strategy that says they should concede but it's another thing altogether to actually put it into practice. HMRC inspectors hate conceding anything.

[GoneSouth]

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