Reply to: AM Limited COP8 HMRC Investigation Letter..

[travellingknob]

Appeals link

https://www.gov.uk/tax-tribunal/appeal-to-tribunal

[Loan Ranger]

Unfortunately I think that's exactly what it means - "We(AML) have made our loot, so go face the taxman and don't talk to us anymore".

Hopefully not a little too late, I however would like to share my experiences of dealing with the HMRC to clean the AML mess. Briefly I used AML for 4 consecutive tax years - how I ended in this **** hole is irrelevant.

HMRC wrote to me about 7 years ago now about the tax avoidance scheme I had used. Due to the fact that I had always had misgivings about the whole tax structure and dodgy EBT/PBT/Trust shenanigans, I decided to ignore AML sugar coated spin and hype.

So here is a summary of what I did. I think it is still helpful, but please move fast in order to 'benefit from the so called net settlement offer by the HMRC'.

1. First I decided to comply with the HMRC's demand for an Accelerated Payment Notice(APN). The other option would have been to contribute £250 to some bogus AML legal fund to challenge the HMRC. At the time, they purpoted to be appointing a well know city legal firm of the initials P....M. I didn't buy this and decided to go it alone.
2. By complying with the HMRC APN on the first tax year of four tax years, I opened the floodgates and soon afterwards they wrote enquiring about the second tax year.
3. As all tax matters are frightening, I kicked myself. However I decided to bite the bullet, so instead of waiting for the same cycle to repeat again another 2 times, I voluntarily disclosed all the tax years that I had used AML and asked then to reassess. I supplied them with all the bank statements showing income from AML and Knox House Trustees. I also furnished HMRC with all my expenses - mostly train tickets and equipment required to carry out my trade. I did not try to obfusciate, obstruct, lie or hide anything.
4. I requested HMRC to cut out AML from any communication regarding my tax affairs.
5. Surprisingly the HMRC used all my expenses(not even a single expense refused) in recomputing my tax burden.
6. However, they grossed up all my income to include AML's management fees (or cheat fees) based on AML marketing literature of 82% retention of your income. e.g. if my bank statements totalled £82k, HMRC would divide that 0.82 and tax me on a perceived contract value of £100k.
7. I disputed the grossing up aspect whilst agreeing with HMRC in all other respects, however the HMRC would not budge.
8. At that point, I had grown in confidence in dealing directly with HMRC. My basic advice is write in plain English in point form and ask them to respond to you in point form as well. Do not tie yourself in unnecessary legal jargon - I am not a lawyer, I only used common sense and simple Year 10 English.
9. The HMRC articulated my rights to me if I didn't agree with their assessment. Therefore I appealed to the First Tier Tribunal(FTT). I could have used a lawyer, but I didn't have the money so I carried on with my plain Year 10 English approach and common sense and launched my appeal to the FTT - it is so simple to do.
10. I also bought what were then known as Certificates of Tax Deposits(CTD). (discontinued after Nov 2017)
11. At that point both the HMRC and myself were now subject to the rules of the FTT. The HMRC had their learned barristers and tax lawyers who wrote in a funny language that I ended up copying for the fun of it - not in excess, I preffered very much my plain English approach. I tended to copy the HMRC lawyers in the presentation of documents. However all my arguments and submissions were as basic as can be.
12. The HMRC lawyers played all the tactics in the rule book in applying for extension, or this other...according to section 9 of the weights and measures act, subsection 2, paragraph 10 of 1801......I remained calm and allowed them to show off their legal knowledge. I knew there are limits to how far they could play the game.
13. They ran out of extension applications and all the other gibberish and goobledygook. The basic truth is that the HMRC legal department was overstretched and didn't have manpower.
14. Whilst waiting for the FTT to set a hearing date - it appeared as if the FTT itself was also under-resourced and couldn't meet their own timescales - the HMRC wrote to me agreeing to my original position of not grossing up the taxable income and asked that I suspend the FTT appeal. This is something they are currently referring to as "The net settlement offer". See https://www.gov.uk/guidance/disguise...ur-tax-affairs.
15. I took up the offer and used my previously purchased Certificate of Tax Deposits to pay the tax with very little interest. The CTDs had the effect of freezing interest on any liabilities.
16. On closure of the enquiry, I withdrew the FTT appeal.

I hope this will help others. In simple terms, I didn't need a lawyer, an accountant or AML. I simply used basic GCSE math to add and subtract, GCSE english to write letters and possibly £20 in recorded delivery postage. Yes with the HMRC, always write letters and post using recorded delivery -their house is not in order.
All this to and fro took a little over 6 years. The best take away for me is to be not afraid of the HMRC or the tribunals - by the way I was going to represent myself in the FTT and face their learned barristers etc. I was ready for it - both for a tick and a laugh.

I seriously take my hat off to you sir. Utmost respect.

[bleakhse]

Other than the PAYE rates prevailing for each respective tax year, I faced no other taxes. by IHT, are you referring to inheritance tax? I had nothing of the sort. On AML and the 'loans', I simply cut them out. I couldn't care less about the 'loans' being written off. I have enough evidence that it was not loans, but disguised remuneration. If anything they owe me money from the 18% they creamed off me. If they are stupid as to ask for the loans to be repaid, I am as ready as ever for them with their expensive lawyers.
The courts/tribunal are ruling that these are not loans, so I would never lose sleep that the AML/Knox house are going to come demanding that I repay a 'loan'. I will simply approach the same courts that are ruling that these are disguised remuneration. The same court cannot say the loans are disguised remuneration in favour of HMRC and then turn round and say oh no, it is a loan in favour of AML/Knox...so which is it? Loan or disguised remuneration...surely the logic is twisted. If AML/Knox want their 'loans' back, they must come, I am ready for them with their 82% retention literature. What was the 82% about? Was it not about my remuneration retention?
Further, by their email of 18th April 2018, AML have unwittingly admitted that these were not loans, but disguised remuneration. Read this extract....
"...You will have received an email from Knox House Trust, the Trustees of the trust that holds your loan. They have outlined 2 options to mitigate the 2019 Loan Charge; Settlement or Repayment...."
Settlement means paying PAYE with the HMRC. I am sure we have all taken loans from banks or other regulated financial institutions. Knox house trust would be the only regulated financial institution whose loans attract PAYE tax from the HMRC.

[howcanigetyoualoan]

Unfortunately I think that's exactly what it means - "We(AML) have made our loot, so go face the taxman and don't talk to us anymore".

Hopefully not a little too late, I however would like to share my experiences of dealing with the HMRC to clean the AML mess. Briefly I used AML for 4 consecutive tax years - how I ended in this **** hole is irrelevant.

HMRC wrote to me about 7 years ago now about the tax avoidance scheme I had used. Due to the fact that I had always had misgivings about the whole tax structure and dodgy EBT/PBT/Trust shenanigans, I decided to ignore AML sugar coated spin and hype.

So here is a summary of what I did. I think it is still helpful, but please move fast in order to 'benefit from the so called net settlement offer by the HMRC'.

1. First I decided to comply with the HMRC's demand for an Accelerated Payment Notice(APN). The other option would have been to contribute £250 to some bogus AML legal fund to challenge the HMRC. At the time, they purpoted to be appointing a well know city legal firm of the initials P....M. I didn't buy this and decided to go it alone.
2. By complying with the HMRC APN on the first tax year of four tax years, I opened the floodgates and soon afterwards they wrote enquiring about the second tax year.
3. As all tax matters are frightening, I kicked myself. However I decided to bite the bullet, so instead of waiting for the same cycle to repeat again another 2 times, I voluntarily disclosed all the tax years that I had used AML and asked then to reassess. I supplied them with all the bank statements showing income from AML and Knox House Trustees. I also furnished HMRC with all my expenses - mostly train tickets and equipment required to carry out my trade. I did not try to obfusciate, obstruct, lie or hide anything.
4. I requested HMRC to cut out AML from any communication regarding my tax affairs.
5. Surprisingly the HMRC used all my expenses(not even a single expense refused) in recomputing my tax burden.
6. However, they grossed up all my income to include AML's management fees (or cheat fees) based on AML marketing literature of 82% retention of your income. e.g. if my bank statements totalled £82k, HMRC would divide that 0.82 and tax me on a perceived contract value of £100k.
7. I disputed the grossing up aspect whilst agreeing with HMRC in all other respects, however the HMRC would not budge.
8. At that point, I had grown in confidence in dealing directly with HMRC. My basic advice is write in plain English in point form and ask them to respond to you in point form as well. Do not tie yourself in unnecessary legal jargon - I am not a lawyer, I only used common sense and simple Year 10 English.
9. The HMRC articulated my rights to me if I didn't agree with their assessment. Therefore I appealed to the First Tier Tribunal(FTT). I could have used a lawyer, but I didn't have the money so I carried on with my plain Year 10 English approach and common sense and launched my appeal to the FTT - it is so simple to do.
10. I also bought what were then known as Certificates of Tax Deposits(CTD). (discontinued after Nov 2017)
11. At that point both the HMRC and myself were now subject to the rules of the FTT. The HMRC had their learned barristers and tax lawyers who wrote in a funny language that I ended up copying for the fun of it - not in excess, I preffered very much my plain English approach. I tended to copy the HMRC lawyers in the presentation of documents. However all my arguments and submissions were as basic as can be.
12. The HMRC lawyers played all the tactics in the rule book in applying for extension, or this other...according to section 9 of the weights and measures act, subsection 2, paragraph 10 of 1801......I remained calm and allowed them to show off their legal knowledge. I knew there are limits to how far they could play the game.
13. They ran out of extension applications and all the other gibberish and goobledygook. The basic truth is that the HMRC legal department was overstretched and didn't have manpower.
14. Whilst waiting for the FTT to set a hearing date - it appeared as if the FTT itself was also under-resourced and couldn't meet their own timescales - the HMRC wrote to me agreeing to my original position of not grossing up the taxable income and asked that I suspend the FTT appeal. This is something they are currently referring to as "The net settlement offer". See https://www.gov.uk/guidance/disguise...ur-tax-affairs.
15. I took up the offer and used my previously purchased Certificate of Tax Deposits to pay the tax with very little interest. The CTDs had the effect of freezing interest on any liabilities.
16. On closure of the enquiry, I withdrew the FTT appeal.

I hope this will help others. In simple terms, I didn't need a lawyer, an accountant or AML. I simply used basic GCSE math to add and subtract, GCSE english to write letters and possibly £20 in recorded delivery postage. Yes with the HMRC, always write letters and post using recorded delivery -their house is not in order.
All this to and fro took a little over 6 years. The best take away for me is to be not afraid of the HMRC or the tribunals - by the way I was going to represent myself in the FTT and face their learned barristers etc. I was ready for it - both for a tick and a laugh.

Brilliant update, thanks. Did AML write off the loans and was there any IHT impact?

[bleakhse]

Does that roughly translate as "so long and thanks for all the fish?"

Unfortunately I think that's exactly what it means - "We(AML) have made our loot, so go face the taxman and don't talk to us anymore".

Hopefully not a little too late, I however would like to share my experiences of dealing with the HMRC to clean the AML mess. Briefly I used AML for 4 consecutive tax years - how I ended in this **** hole is irrelevant.

HMRC wrote to me about 7 years ago now about the tax avoidance scheme I had used. Due to the fact that I had always had misgivings about the whole tax structure and dodgy EBT/PBT/Trust shenanigans, I decided to ignore AML sugar coated spin and hype.

So here is a summary of what I did. I think it is still helpful, but please move fast in order to 'benefit from the so called net settlement offer by the HMRC'.

1. First I decided to comply with the HMRC's demand for an Accelerated Payment Notice(APN). The other option would have been to contribute £250 to some bogus AML legal fund to challenge the HMRC. At the time, they purpoted to be appointing a well know city legal firm of the initials P....M. I didn't buy this and decided to go it alone.
2. By complying with the HMRC APN on the first tax year of four tax years, I opened the floodgates and soon afterwards they wrote enquiring about the second tax year.
3. As all tax matters are frightening, I kicked myself. However I decided to bite the bullet, so instead of waiting for the same cycle to repeat again another 2 times, I voluntarily disclosed all the tax years that I had used AML and asked then to reassess. I supplied them with all the bank statements showing income from AML and Knox House Trustees. I also furnished HMRC with all my expenses - mostly train tickets and equipment required to carry out my trade. I did not try to obfusciate, obstruct, lie or hide anything.
4. I requested HMRC to cut out AML from any communication regarding my tax affairs.
5. Surprisingly the HMRC used all my expenses(not even a single expense refused) in recomputing my tax burden.
6. However, they grossed up all my income to include AML's management fees (or cheat fees) based on AML marketing literature of 82% retention of your income. e.g. if my bank statements totalled £82k, HMRC would divide that 0.82 and tax me on a perceived contract value of £100k.
7. I disputed the grossing up aspect whilst agreeing with HMRC in all other respects, however the HMRC would not budge.
8. At that point, I had grown in confidence in dealing directly with HMRC. My basic advice is write in plain English in point form and ask them to respond to you in point form as well. Do not tie yourself in unnecessary legal jargon - I am not a lawyer, I only used common sense and simple Year 10 English.
9. The HMRC articulated my rights to me if I didn't agree with their assessment. Therefore I appealed to the First Tier Tribunal(FTT). I could have used a lawyer, but I didn't have the money so I carried on with my plain Year 10 English approach and common sense and launched my appeal to the FTT - it is so simple to do.
10. I also bought what were then known as Certificates of Tax Deposits(CTD). (discontinued after Nov 2017)
11. At that point both the HMRC and myself were now subject to the rules of the FTT. The HMRC had their learned barristers and tax lawyers who wrote in a funny language that I ended up copying for the fun of it - not in excess, I preffered very much my plain English approach. I tended to copy the HMRC lawyers in the presentation of documents. However all my arguments and submissions were as basic as can be.
12. The HMRC lawyers played all the tactics in the rule book in applying for extension, or this other...according to section 9 of the weights and measures act, subsection 2, paragraph 10 of 1801......I remained calm and allowed them to show off their legal knowledge. I knew there are limits to how far they could play the game.
13. They ran out of extension applications and all the other gibberish and goobledygook. The basic truth is that the HMRC legal department was overstretched and didn't have manpower.
14. Whilst waiting for the FTT to set a hearing date - it appeared as if the FTT itself was also under-resourced and couldn't meet their own timescales - the HMRC wrote to me agreeing to my original position of not grossing up the taxable income and asked that I suspend the FTT appeal. This is something they are currently referring to as "The net settlement offer". See https://www.gov.uk/guidance/disguise...ur-tax-affairs.
15. I took up the offer and used my previously purchased Certificate of Tax Deposits to pay the tax with very little interest. The CTDs had the effect of freezing interest on any liabilities.
16. On closure of the enquiry, I withdrew the FTT appeal.

I hope this will help others. In simple terms, I didn't need a lawyer, an accountant or AML. I simply used basic GCSE math to add and subtract, GCSE english to write letters and possibly £20 in recorded delivery postage. Yes with the HMRC, always write letters and post using recorded delivery -their house is not in order.
All this to and fro took a little over 6 years. The best take away for me is to be not afraid of the HMRC or the tribunals - by the way I was going to represent myself in the FTT and face their learned barristers etc. I was ready for it - both for a tick and a laugh.

[LOL17]

Does that roughly translate as "so long and thanks for all the fish?"

[DOT COM]

Newbie

Howdy all,

Got the email from AML and Knox house as well 2 separate emails.

See below.


AML

Contractor Loan Legislation - you are affected. Do not delay taking action now.

The purpose of this email is to bring to your attention all the options that are available to you concerning the Loan Charge legislation introduced by HMRC, which will take effect from April 2019.

As a recipient of a third party loan you will be caught by this punitive legislation and should take remedial action to mitigate your liability without delay. At the time the loans were made, they were within the tax legislation and not taxable. However, the new ‘Loan Charge’ legislation has been made retrospectively and you will be subject to the full force of this legislation when it takes effect in 2019.

If you have an ongoing Enquiry with HMRC, you may already be in communication with AML Tax who were appointed to deal with the Enquiries on your behalf. AML Tax is continuing to, and are committed to, working with HMRC and defending the arrangements in the First Tier of the Tax Tribunal where relevant. AML Tax will continue this extensive work in relation to enquiries only. You will have received an email from Knox House Trust, the Trustees of the trust that holds your loan. They have outlined 2 options to mitigate the 2019 Loan Charge; Settlement or Repayment. They cannot offer assistance and have suggested the services of contractor specialist PTS Limited, who can assist with these 2 options. There is no disadvantage to registering your interest in a settlement, however it must be done before 31 May 2018.

We would like to draw to your attention that there are further alternative options available. Vanquish Options can provide a mechanism to repay your existing loan which meets the requirements of the Loan Charge legislation and is supported by Tax Counsel opinion. Examples of the financial impact of each option are available. Please take time to review their website and contact Vanquish Options on 0203 740 3876. Taking no action will not avoid the 2019 Loan Charge.

Kind regards
The AML Team



KNOX HOUSE
HMRC Contractor Loan Settlement Opportunity - Deadline 31st May 2018

As a recipient of a contractor loan whilst working through AML, we are making you aware of new legislation, known as the “Loan Charge”, which will take effect as early as next year and an early Contractor Loan Settlement Opportunity (“CLSO”) that HMRC are offering. We are writing to you as Trustees of the Trust that holds these loans and your action is required.

At the time you received your loans, AML had Tax Counsel’s Opinion that the loans were not taxable. When the Disguised Remuneration legislation was introduced in 2010, HMRC only sought to tax relevant payments made after the introduction of the new rules. However, HMRC is now going back and seeking to tax any loans made since 1999, over 10 years before the Disguised Remuneration rules even applied.

The 2019 Loan Charge will not apply if the loan is repaid prior to 5 April 2019, or you reach a settlement with HMRC. We will work with you in any way we can to assist you with repayment of the loan. However, there is no other action we, as Trustees, can take to avoid the 2019 Loan Charge applying.

You have a personal obligation to provide HMRC with details of your loans. This must be provided to HMRC by 1 October 2019 otherwise penalties will apply.

If you take no action then any outstanding loan as at 5 April 2019 will be subject to a tax charge. The legislation treats the outstanding loan as income in the year of charge. For many, this will result in the whole amount becoming chargeable at the higher rate (40%) or the additional rate (45%). In addition, this may result in the loss of the Personal Allowance due to the level of taxable income. Penalties and interest may also be applied if the tax is paid late or you do not disclose the loans to HMRC.

The CLSO announced is available to all individuals with outstanding third party loans. The nature of the offer means that your loans will qualify. The CLSO charges tax on the net loan you received, as income in the year of receipt. This means that the actual tax liability will take into account, where available, personal allowances and the basic rate band for each year. In certain circumstances, interest will not be due on the tax. In most cases this will mean that the liability under the CLSO is lower than that under the Loan Charge.

Whilst the loan charge is still a little way off, the option to register your interest for the CLSO will close on the 31 May 2018. Registering does not commit you to actually proceeding with a settlement, but not registering in time means that you cannot use the CLSO.

If you already have an ongoing Enquiry with HMRC, there is no disadvantage to registering your interest in a settlement. This provides you with time to explore and discuss your options taking into consideration your ongoing enquiries, and to examine whether settlement is appropriate for your circumstances. Settlement information does not have to be provided to HMRC until 30 September 2018.

As Trustees it is our obligation to:
1. Bring the CLSO to your attention; and
2. Highlight the need for you to take action.

If you do nothing and your loan remains outstanding, HMRC could at some point in the future make a request under the Exchange of Information rules for the Trustees to disclose the information held regarding your loans. Doing nothing will not avoid the 2019 Loan Charge.

We cannot provide direct assistance on tax matters. PTS Limited who are specialised in the provision of settlement services will be able to assist you in considering the full range of options that may be available. Depending on your circumstances, these options may, or may not, include the CLSO.

Further detail is provided on the button below together with the option to register your interest in settlement and contact details for PTS Limited.

Yours sincerely

Knox House Trust Limited
Knox House Trust Limited is licensed by the Isle of Man Financial Services Authority and registered in the Isle of Man. Company number 125720C. VAT Registration No. 003 3427 28. Registered Office: Knox House, 16 – 18 Finch Road, Douglas IM1 2PT.

[MLeggsy]

Me too

I take it everyone involved with AML received the emails this morning?

Yes. Got mine today.

They've been coming out over the past week or so. Looks like in participation date order.

MLeggsy

[LOL17]

I take it everyone involved with AML received the emails this morning?

[luxCon]

Pre 2011 EBT loan pay back

Has anyone tried paying back pre-2011 AM loan? Is this possible? and if anyone has how did AM redistribute ?

[LandRover]

I also used AML from 2014 - 2016 and like you have been keeping an eye on this thread through the cracks in my fingers! As of now i have not heard anything from AML but would like to contact them, do you have and email/phone number for them?

I would recommend all ex-aml people to look at joining Big Group, we have quite a ex-AML members who benefit by all the help and advice given.

[Worried 72]

I have been keeping an eye on this thread as I was a contractor who used AML. Has anyone heard anything from either AML or HMRC lately? I asked AML to request a closure notice from HMRC on my behalf back in June but I've not heard a dicky bird since.

I also used AML from 2014 - 2016 and like you have been keeping an eye on this thread through the cracks in my fingers! As of now i have not heard anything from AML but would like to contact them, do you have and email/phone number for them?

[LOL17]

Whilst I can't speak for AML I suspect that the closure notice was either resisted and delayed, or has yet to be issued or has been issued and now a case management hearing date is awaited.

Bear in mind that the FTT is very short of judges and hearings are often scheduled for months away.

Thanks. I know some say that no news is good news but I’m not sure that applies to HMRC.

[webberg]

Whilst I can't speak for AML I suspect that the closure notice was either resisted and delayed, or has yet to be issued or has been issued and now a case management hearing date is awaited.

Bear in mind that the FTT is very short of judges and hearings are often scheduled for months away.

[LOL17]

I have been keeping an eye on this thread as I was a contractor who used AML. Has anyone heard anything from either AML or HMRC lately? I asked AML to request a closure notice from HMRC on my behalf back in June but I've not heard a dicky bird since.