HMRC will not claim cost as most of litigation start with the arrangement that no party will claim cost.
Nothing is dead until it is done. But for HMRC to change stance they need to have a carrot. If HMRC lose against Rangers in Supreme Court and / or in FTT next year where first mass marketed scheme will be in court and/or fisher case to be heard in April goes against HMRC - then yes HMRC will soften the approach. Until then just on cost basis of going to Supreme Court even if HMRC gives 11% discount to us it does not mean much.
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Collapse
You are not logged in or you do not have permission to access this page. This could be due to one of several reasons:
- You are not logged in. If you are already registered, fill in the form below to log in, or follow the "Sign Up" link to register a new account.
- You may not have sufficient privileges to access this page. Are you trying to edit someone else's post, access administrative features or some other privileged system?
- If you are trying to post, the administrator may have disabled your account, or it may be awaiting activation.
Logging in...
Previously on "Supreme Court Decision - Share options and banker's bonuses"
Collapse
-
That internal time might be say a team averaging 25 for 12 years at £50k a year each = £15m.
I really doubt it.
Leave a comment:
-
Originally posted by webberg View PostI very much suspect that there are a number of follower banks who were doing something similar and will now settle so that the final tax collected will be substantially more than the headline value of £135m.
Originally posted by webberg View PostI can see no suggestion that HMRC is seeking costs but they may do.
Leave a comment:
-
Given the mention of Big Group, I'll comment.
The UBS/DB schemes were from a generation ago and were acceptable in their day. I very much suspect that there are a number of follower banks who were doing something similar and will now settle so that the final tax collected will be substantially more than the headline value of £135m.
Getting there has require 12 years of investigation and 4 stages of Courts. I can see no suggestion that HMRC is seeking costs but they may do. I would conservatively estimate HMRC costs (paid by you) as being close to £1m plus internal time. That internal time might be say a team averaging 25 for 12 years at £50k a year each = £15m.
Let's call that £15m all up. To collect £135m. That's 11% of the tax. (I'm ignoring interest).
That's substantially more than the usual cost of collecting tax revenue.
Contractor schemes pre 2011 might be collated into 3 types and a positive decision on each will be needed. Post 2011, perhaps 5 to 8 different types.
It is always possible for HMRC to take a totally uncommercial stance and spend (your) money on fighting them all. The time and cost might be seen as necessary to preserve policy. My guess however is that a well put together technical analysis that causes them to hesitate and even think about other analysis is going to be considered at the highest levels.
Is that a guarantee? no.
Is a win for HMRC in UBS/DB a guarantee that contractor schemes are dead? no.
Does this mean that litigation on contractor schemes is not worthwhile? no.
The point is, whilst the UBS/DB result has perhaps shifted the balance very slightly, it has not rendered Big Group (or other litigation groups) strategy obselete.
Leave a comment:
-
Originally posted by DonkeyRhubarb View PostUnfortunately, for the bankers, in favour of HMRC.
Bankers' bonuses: Supreme Court sides with HMRC in appeal against UBS and Deutsche Bank, ruling out scheme designed to avoid income tax | City A.M.
Leave a comment:
-
Originally posted by StrengthInNumbers View PostDoesn't matter but one way or another seems like courts are aligned with HMRC's view. Whatever be the reason, whether we like it or not, we need to make decision based on all the information available. Until before this decision things were different but now I am not of the view that courts will help us. And if courts are with HMRC I don't understand how Big Group can motivate HMRC to change analysis.
Not only does the case involve banks, the largest hate target for a generation, but HMRC and the Courts know that the banks involved have got plenty of cash. All win for everyone involved.
Whereas individuals do not have the same resources so many are facing insolvency.
Even the most ardent to HMRC supporters are of the view that collecting a percentage of the tax they want as a certainty is better than years in court. Even then, HMRC will not be able to collect all the money from many individuals as they simply don't have the resources available - and bankruptcy won't get them anything either.
As one of the HMRC officers told us about the impending bankruptcy... "it's fully deserved".
Clearly no money spent on training at the charm school.
BG is helping many people stuck at the end of appalling treatment by HMRC. Treatment that is against their own charter and may well be illegal.
BG can at least campaign for a humane settlement, even if it can't fight retrospective interpretation of the law.
Leave a comment:
-
Doesn't matter but one way or another seems like courts are aligned with HMRC's view. Whatever be the reason, whether we like it or not, we need to make decision based on all the information available. Until before this decision things were different but now I am not of the view that courts will help us. And if courts are with HMRC I don't understand how Big Group can motivate HMRC to change analysis.
Leave a comment:
-
The courts seem to have changed their approach to tax avoidance cases in recent years.
There's a lot more use of the purposive than the literal.
Direct political interference? Probably not. More likely they are just reflecting public opinion which, of course, has been whipped up by politicians. The Justice System, which is paid for by taxes, has also faced severe cuts in recent years. The legal aid budget has been slashed. Courts are closing. Jobs have been lost, pay frozen.
UK judges disillusioned after drop in pay and conditions, survey finds | Law | The Guardian
I wonder whether some of the decisions we're seeing now, in favour of HMRC, would have gone a different way 10 years ago.Last edited by DonkeyRhubarb; 10 March 2016, 08:27.
Leave a comment:
-
Originally posted by Not Losing Any Sleep View PostWorth listening to. The will of parliament etc.
Bankers' bonus tax avoidance schemes named them after Houdini are illegal | Daily Mail Online
Leave a comment:
-
[QUOTE=Iliketax;2221272]No, this was a very contrived scheme to get around UK tax rules. It was a way of dressing up a bonus scheme as something else. It had absolutely nothing to do with anything being done in Germany (other than there being a German bonus scheme).
And pigs may fly.
The first part of the para 97 of the judgement would be worrying reading for employees who got loans (e.g. Murray Group):
Worth listening to. The will of parliament etc.
Bankers' bonus tax avoidance schemes named them after Houdini are illegal | Daily Mail Online
Leave a comment:
-
Originally posted by webberg View Postapparently the sort of scheme seen here was good in Germany at the time.
Originally posted by webberg View PostDB may well go further yet with a case going to ECJ
Originally posted by webberg View PostI'm not so sure that it means that much for contractor schemes
Originally posted by Lord ReedIt may well be that, in an appropriate case, the statutory term “money”, construed purposively, might apply to arrangements which, viewed realistically, were no more than disguised or artificially contrived methods of paying cash to employees.
Leave a comment:
-
Also worth noting that this case started in 2004.
It has taken 12 years to get this far and my sources tell me that DB may well go further yet with a case going to ECJ as apparently the sort of scheme seen here was good in Germany at the time.
UBS of course have no such fall back unless that have some sort of parallel agreement with the EU.
This is a complicated decision and whilst I expect the headline writers to grab the "HMRC Victory" angle, I'm not so sure that it means that much for contractor schemes (let's face it a win would have been better).
As such I'm going to take my time and read the thing first before making public any thoughts.
Leave a comment:
-
Probably the banks and not the bankers will pay.
Thus the bank's customers ultimately pay (or the shareholders).
Leave a comment:
-
Originally posted by Not Losing Any Sleep View PostAppeal allowed.
Bankers' bonuses: Supreme Court sides with HMRC in appeal against UBS and Deutsche Bank, ruling out scheme designed to avoid income tax | City A.M.
Leave a comment:
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Leave a comment: