Accelerated Payment Notices
There have been two potentially significant announcements made by Government in the past week or so, which are highly likely to affect those on this forum.
The Finance Bill 2014 will contain legislation to significantly change the economic landscape for those participating in tax planning arrangements. Both seek to shift the financial burden of protracted enquiries, and potentially litigation, from Government to taxpayers.
The proposals regarding ‘failure notices’ were first released last August in a document called 'Raising the stakes on tax avoidance'. The draft legislation has now been published along with further proposals and is open for comment.
https://www.gov.uk/government/upload..._avoidance.pdf
The relevant parts of the consultation document are contained at pages 35 to 45.
Under the proposals for ‘failure notices’ taxpayers who have used an avoidance scheme similar to one that a court or tribunal has already overruled will also have to pay the amount HMRC says they owe. When issuing a ‘failure notice’ HMRC would, at the same time, issue a payment notice giving 90 days to pay the disputed tax. Late payment penalties of up to 15 per cent will be imposed in three successive stages for delays in paying the tax under dispute.
But the question of whether HMRC might issue ‘failure notices’ to taxpayers on this forum following Boyle will be a moot question if further proposals announced last Friday become law.
In a further consultation document (https://www.gov.uk/government/upload..._avoidance.pdf - see page 15 onwards) the Government announced plans to extend the ‘failure notice’ measure to all cases involving schemes disclosed, or that should have been disclosed, under the DOTAS (Disclosure of Tax Avoidance Schemes) regime.
Under these proposals, payment of the disputed tax in respect of ongoing enquiries would be required from anyone who has taken part in a DOTAS scheme, or one that should have been disclosed under DOTAS. This would apply in relation both to existing cases, which have not yet been settled, and to new cases.
This proposal is subject to consultation and there is therefore an opportunity for those on this forum to have your say. The rules will not change if you simply vent your spleen on here. The email address to which representations should be sent is included within each consultation document. You can influence these rules only if you use them.
I personally recommend that any representations focus upon the economic consequences of unexpectedly having to pay tax under dispute before the question of liability has been determined by the Courts rather than any argument about the validity of EBT loan planning: HMRC have long publicised their view of EBTs and that isn't going to change.
There have been two potentially significant announcements made by Government in the past week or so, which are highly likely to affect those on this forum.
The Finance Bill 2014 will contain legislation to significantly change the economic landscape for those participating in tax planning arrangements. Both seek to shift the financial burden of protracted enquiries, and potentially litigation, from Government to taxpayers.
The proposals regarding ‘failure notices’ were first released last August in a document called 'Raising the stakes on tax avoidance'. The draft legislation has now been published along with further proposals and is open for comment.
https://www.gov.uk/government/upload..._avoidance.pdf
The relevant parts of the consultation document are contained at pages 35 to 45.
Under the proposals for ‘failure notices’ taxpayers who have used an avoidance scheme similar to one that a court or tribunal has already overruled will also have to pay the amount HMRC says they owe. When issuing a ‘failure notice’ HMRC would, at the same time, issue a payment notice giving 90 days to pay the disputed tax. Late payment penalties of up to 15 per cent will be imposed in three successive stages for delays in paying the tax under dispute.
But the question of whether HMRC might issue ‘failure notices’ to taxpayers on this forum following Boyle will be a moot question if further proposals announced last Friday become law.
In a further consultation document (https://www.gov.uk/government/upload..._avoidance.pdf - see page 15 onwards) the Government announced plans to extend the ‘failure notice’ measure to all cases involving schemes disclosed, or that should have been disclosed, under the DOTAS (Disclosure of Tax Avoidance Schemes) regime.
Under these proposals, payment of the disputed tax in respect of ongoing enquiries would be required from anyone who has taken part in a DOTAS scheme, or one that should have been disclosed under DOTAS. This would apply in relation both to existing cases, which have not yet been settled, and to new cases.
This proposal is subject to consultation and there is therefore an opportunity for those on this forum to have your say. The rules will not change if you simply vent your spleen on here. The email address to which representations should be sent is included within each consultation document. You can influence these rules only if you use them.
I personally recommend that any representations focus upon the economic consequences of unexpectedly having to pay tax under dispute before the question of liability has been determined by the Courts rather than any argument about the validity of EBT loan planning: HMRC have long publicised their view of EBTs and that isn't going to change.
Comment