HMRC Consultative Document - marketed tax avoidance schemes

[DonkeyRhubarb]

So they will be sending 16000 "bills" out in July / August ?

Probably not all in July/August but any time from July onwards.

And, by the way, it will be a lot more than 16,000.

The number of users in the table on page 7 comes to a total of 42,800.

HMRC will be looking to use this proposal to target as many of the 65,000 open cases as possible.

[Contract Crusader]

What about Section 29 TMA 1970

This is probably required reading if you have an open tax enquiry under Section 9A TMA 1970:

https://www.gov.uk/government/upload..._avoidance.pdf

<admin note>Just fixed the pdf link - the HTML version can be viewed two posts down...</admin note>

Michael you have mentioned Section 9A TMA 1970 but what about Section 29? Would this still apply?

[varunksingh]

As Saleos pointed out that this is much larger than only EBTs and DOTAS, I have emailed and requested organizations like PCG, CIOT, CBI and IoD to get involved. I have given details of my limited company and I guess if enough business owners get in touch with various bodies then they will get involved.

[cojak]

As Saleos pointed out that this is much larger than only EBTs and DOTAS, I have emailed and requested organizations like PCG, CIOT, CBI and IoD to get involved. I have given details of my limited company and I guess if enough business owners get in touch with various bodies then they will get involved.

How much larger? What other tax planning activities do you think will be affected?

[TheDandy]

As Saleos pointed out that this is much larger than only EBTs and DOTAS, I have emailed and requested organizations like PCG, CIOT, CBI and IoD to get involved. I have given details of my limited company and I guess if enough business owners get in touch with various bodies then they will get involved.

On what basis should they get involved? They may have an opinion, and they may already be contributing responses to a wide range of proposals, but none of these organisations I imagine would have any interesting in arguing against the measures outlined for 'Aggressive Tax Avoidance' schemes. In fact it would be in PCG's interest to support the measures if anything.

I think what you are generally alluding to is the fact that it does not preclude the use of the legislation in other areas (quite possibly), and in principal raises the question 'who's next'; is the thin end of a very large wedge!

If it has wider implications then at this stage it is no more than 'degrees of risk' for other, as at this point unidentified targets. I personally think you should not divert too much of your attention to this. Work on the basis that it will be passed and focus on the implications of it getting passed - those things you can control or do your best to plan for.

[MrO666]

I think all in all this legislation will get the green light at some level. Perhaps HMRC won't get everything they're asking for, but I can't see them getting none of it at all.

One thing that I will be stating in my consultation response is this:

In the case of HMRC being in possession of all facts (P11D, P60, Self assessment etc), then they should be duty bound to base ANY assessment on fact and not fabricated figures.

For HMRC to be able to pick any number from the air and demand you pay it on account, is in my opinion the bigger issue here. Both assessments I'm in receipt of are incorrect, despite HMRC being in full possession of everything they need to give me a very accurate assessment. They just appear to be too lazy to do so.

[varunksingh]

How much larger? What other tax planning activities do you think will be affected?

I am not an accountant so cannot be 100% sure but to me it looks like anyone under Section 9A TMA 1970 could get affect IF NOT MORE

[cojak]

I am not an accountant so cannot be 100% sure but to me it looks like anyone under Section 9A TMA 1970 could get affect IF NOT MORE

I've googled that and what I get is this:

This may indicate a fairly routine enquiry, which can be resolved by the production of supporting records. However, it could also be the prelude to more serious investigations under the COP 8 or COP 9 procedures if HMRC suspect there is evidence of tax avoidance or tax fraud.

But I'll put that point in the generic EBT thread.

[TheDandy]

I think all in all this legislation will get the green light at some level. Perhaps HMRC won't get everything they're asking for, but I can't see them getting none of it at all.

One thing that I will be stating in my consultation response is this:

In the case of HMRC being in possession of all facts (P11D, P60, Self assessment etc), then they should be duty bound to base ANY assessment on fact and not fabricated figures.

For HMRC to be able to pick any number from the air and demand you pay it on account, is in my opinion the bigger issue here. Both assessments I'm in receipt of are incorrect, despite HMRC being in full possession of everything they need to give me a very accurate assessment. They just appear to be too lazy to do so.

The fact that the estimate is wrong on your P11D is not the big issue at all. That can be resolved by furnishing them with details required to make an accurate assessment of what 'THEY' think is at risk. Co-operating in that way does not mean you are saying that you agree that tax is due.

[varunksingh]

On what basis should they get involved? They may have an opinion, and they may already be contributing responses to a wide range of proposals, but none of these organisations I imagine would have any interesting in arguing against the measures outlined for 'Aggressive Tax Avoidance' schemes. In fact it would be in PCG's interest to support the measures if anything.

I think what you are generally alluding to is the fact that it does not preclude the use of the legislation in other areas (quite possibly), and in principal raises the question 'who's next'; is the thin end of a very large wedge!

If it has wider implications then at this stage it is no more than 'degrees of risk' for other, as at this point unidentified targets. I personally think you should not divert to much of your attention to this. Work on the basis that it will be passed and focus on the implications of it getting passed - those things you can control or do your best to plan for.

PCG should get involved because tomorrow it might come to my Ltd Company in which my Spouse is a partner. I am just trying to bring it to their attention. HMRC should confirm that this legislation preclude other areas. From what I have read I cannot see that.

I have 100% started working on the assumption that this will be passed. Save every penny and earn as much as possible. My spouse is also trying to restart working back to help us get through. We will give it our best shot and pay as much as possible. If they demand all they would claim I own over 5 years of using these schemes, we will not be able to pay but I will try and do my best to pay up.

But at the same time I don't want to back off and forget about all this once paid. I am hoping all affected will stand together and fight it. Rangers UTT hearing will finish in Mar and result should be out between Aug - Nov. Other EBT cases must also be in court and depending on how they go will clear quite a bit. Problem is all affected will still have to fight HMRC. For eg. Boyle's decision in FTT also mentioned about DOTAS disclosure in return and time limits which should apply. HMRC are out of time for 09/10 but will ignore it unless challenged in Tribunal once they have the tax collected. Thus the need for all affected to ensure they stick together for this long drawn battle to get our money back.

In my response to consultation I will stress that HMRC should be also liable for consequential costs which I will bear trying to pay this - they agree or not different story. Rest assured if the tax is due I will pay it instead of going bankrupt - it will not be easy but tax is my responsibility and I will take it up proudly. I am only against HMRC stopping me being as efficient with my tax planning as law allows. Tax is my duty but tax planning is my right as well. And based on these arguments all tax payers should be involved. What HMRC is doing just against natural justice. Retrospective law affected many in 2008, now it is going to affect many more and in future it will affect more if tax payer do not stand against it.