<![CDATA[Tax-Forum - All Forums]]> http://tax-forum.biz/ Mon, 20 May 2013 04:12:50 +0000 MyBB <![CDATA[JP Morgan]]> http://tax-forum.biz/showthread.php?tid=561 Thu, 01 Nov 2012 09:26:10 +0000 http://tax-forum.biz/showthread.php?tid=561 <![CDATA[K2]]> http://tax-forum.biz/showthread.php?tid=496 Wed, 20 Jun 2012 10:04:34 +0000 http://tax-forum.biz/showthread.php?tid=496 <![CDATA[Legal Title]]> http://tax-forum.biz/showthread.php?tid=417 Wed, 01 Feb 2012 10:02:20 +0000 http://tax-forum.biz/showthread.php?tid=417
.docx  Legal Title - Expert Opinion BW LLP - Feb 12.docx (Size: 10.63 KB / Downloads: 36) ]]>
.docx  Legal Title - Expert Opinion BW LLP - Feb 12.docx (Size: 10.63 KB / Downloads: 36) ]]> <![CDATA[Accountancy Services]]> http://tax-forum.biz/showthread.php?tid=360 Mon, 24 Oct 2011 11:25:14 +0000 http://tax-forum.biz/showthread.php?tid=360
If you would like to know more about our services in this area please contact me melinda@lucentum.co.uk or have a look at our website http://www.lucentum.co.uk.

Implementation is key and ongoing support is definitely to be recommended.]]>
If you would like to know more about our services in this area please contact me melinda@lucentum.co.uk or have a look at our website http://www.lucentum.co.uk.

Implementation is key and ongoing support is definitely to be recommended.]]> <![CDATA[BBC Uncovers Truth About Rangers Tax Problems]]> http://tax-forum.biz/showthread.php?tid=359 Mon, 24 Oct 2011 10:06:04 +0000 http://tax-forum.biz/showthread.php?tid=359 BBC News Story
A giant on the ropes: Rangers' tax troubles Q&A
By Matt Slater
Sports news reporter

For 90 minutes at Ibrox this Sunday, all will seem normal in Scottish football.

Rangers and Celtic will tear into each other, more than 50,000 fans at the game will roar themselves hoarse, thousands more will shout at their computers, radios and televisions, and police in Glasgow, Belfast and beyond will ready themselves for a lively shift. It will be business as usual for the Old Firm.

But for Rangers, the champions and current league leaders, the past week has been anything but business as usual. Two legal setbacks in an Edinburgh court have broken the seal on Rangers' darkest secret: they are staring apparent financial ruin in the face.

This epiphany has brought forth a flood of questions from fans, detractors and other interested observers: most of these can be summed up as variations on shock or schadenfreude. I cannot promise to answer all of them but I will try to tackle the most pressing.

Q: What on earth is going on?

A: Rangers are being pursued by HM Revenue and Customs (HMRC) for two unpaid bills. With interest and late-payment penalties going back more than 10 years, they now total in the region of £54m, although the final figure could be even higher according to some sources.

Q: How did that happen?

A: The only simple way to answer this is to start with an important distinction: tax avoidance is legal, tax evasion is illegal. Rangers, like most companies and wealthy individuals, have tried to reduce their tax bills. Some people say this is the cynical exploitation of loopholes, others say it is business (and it is, to be fair, pretty big business).

There is, however, a fine line between avoidance and evasion and Rangers MAY have smudged it over the last decade with two schemes designed to reward their top earners in the most "tax efficient" way.

Q: What did they do?

A: Let's deal with the biggest bill first.

Between 2001 and 2010, Rangers paid almost £48m into an Employee Benefit Trust (EBT). A trust is a legal creation that enables somebody to own an asset on behalf of somebody else. The first person is the trustee and the second is the beneficiary. Company pension schemes are a common example of a trust.

With EBTs, an employer pays money into a trust and that money is paid out to the beneficiaries in the form of loans. These loans are not subject to income tax or National Insurance. In fact, most of these trusts are based in offshore tax havens so they are hardly taxed at all.

Anyway, these loans are a bit like the ones you would offer a hard-up friend on a night out - here's £20, pay me back when you can but I'm not going to remember this so don't worry about it. Here, however, is the heart of HMRC's case.

For an EBT to stay on the right side of the avoidance/evasion line, these payments cannot be made on a contractual basis, as that would make them wages and therefore subject to the usual deductions. So they should, on occasion, be postponed and even refused by the trustee, who is, in theory, acting independently of the employer anyway.

HMRC says Rangers' EBT did not work like this and was, for all intents and purposes, a tax scam. It also says it has proof of this in the form of documents and emails between Ibrox's top brass and players' agents. So, last year, an angry taxman hit Rangers with a bill for £35m in unpaid tax and interest and £14m in penalties.

Rangers, already in debt to their banker and other creditors to the tune of almost £30m, denied the accusation of tax evasion and went to a tribunal in October to argue their case.

That hearing lasted for two weeks but when no decision was reached it was rescheduled for a further three weeks this spring. Again, no decision came and a final tribunal hearing will take place in November.

Q: What about the other bill?

A: This one emerged in the club's accounts this April and is related to a different tax avoidance ruse operated between 1999 and 2003.

Called a Discounted Options Scheme, it is a more complicated version of the EBT as it funnels what experts call the "disguised remuneration" through a "money-box company" set up in a tax haven. The beneficiary then gets shares in the company and you can guess the rest.

It was, for a while, a popular way for bankers to avoid paying tax on their bonuses but HMRC closed the loophole and has been chasing up lost tax ever since.

The sum Rangers owe - and they have agreed this much - is £2.8m in back taxes and interest. What they continue to dispute is the £1.4m HMRC is demanding in penalties. The undisputed amount is due now, in fact, it's overdue again, if that makes sense.

The taxman has been applying considerable pressure in recent weeks, via the courts, prompting some to wonder if Rangers can even pay this relatively small sum, which brings us to this week's shenanigans.

Q: The two legal defeats in Edinburgh?

A: Yes, broadly speaking.

In the first, Rangers were taken to court over an unpaid legal bill of £35,000. The amount and what it was for are not relevant to this tale but what came out in court last week is. The law firm in question effectively put in black and white what some had been saying for some time: Rangers might go bust, we want our money now.

If that message had not got through it was spelled out in bold type all over the Scottish tabloids this week when Martin Bain, the former Rangers chief executive, successfully persuaded a judge to freeze £480,000 of Rangers' money just in case they might not be able to pay the £1.3m in damages he wants for breach of contract.

The judge ring-fenced half of what the life-long Rangers fan was asking to freeze because he agreed there was a "real and substantial risk of insolvency". That would make a win for Bain in vain.

But what really hurt Rangers' new owner Craig Whyte, the man who pushed Bain out, was the leaking of court papers filed by the ex-CEO that revealed just how exposed Rangers are to an HMRC victory.

And Bain should know, he went to work at Ibrox in 1996, joined the board in 2000 and ran the business for former owner Sir David Murray from 2005.

Having recently mortgaged off the next few years' catering revenues at Ibrox, Whyte can afford to pay the smaller tax bill and worry about filling the hole in the club's finances later. But being forced to pay even a hefty chunk of the big bill will kill a club that played a European final only three years ago.

Q: So why did Whyte buy Rangers with all this hanging over them?

A: The only sensible answer to this question is "pass" as so much is uncertain and so little is known for sure about Whyte's finances.

But in the time it has taken me to write this piece, the 40-year-old businessman has issued a passionate denial that Rangers are at the abyss.

"The club is trading normally and has a strong balance sheet," Whyte said via Rangers' official website, before lambasting Bain and others for wrongly suggesting the club is on the brink.

"No one can say with 100% certainty what the outcome will be - that is why there is a tribunal," Whyte added. "(But) I can say categorically that we will be fighting the club's case most vigorously."

And that, with an Old Firm game looming, is all any Rangers fan can ask for.

Baxendale Walker LLP comment:
It is helpful to see that the BBC has published the truth about these tax arrangements, after all the speculative rumours that have filled blogs over the last few months.

Those who have read our press release some time ago, will see what it said mirrored in the BBC Report:
"For an EBT to stay on the right side of the avoidance/evasion line, these payments cannot be made on a contractual basis, as that would make them wages and therefore subject to the usual deductions. So they should, on occasion, be postponed and even refused by the trustee, who is, in theory, acting independently of the employer anyway.

HMRC says Rangers' EBT did not work like this and was, for all intents and purposes, a tax scam. It also says it has proof of this in the form of documents and emails between Ibrox's top brass and players' agents. So, last year, an angry taxman hit Rangers with a bill for £35m in unpaid tax and interest and £14m in penalties."


BAXENDALE WALKER LLP]]> BBC News Story
A giant on the ropes: Rangers' tax troubles Q&A
By Matt Slater
Sports news reporter

For 90 minutes at Ibrox this Sunday, all will seem normal in Scottish football.

Rangers and Celtic will tear into each other, more than 50,000 fans at the game will roar themselves hoarse, thousands more will shout at their computers, radios and televisions, and police in Glasgow, Belfast and beyond will ready themselves for a lively shift. It will be business as usual for the Old Firm.

But for Rangers, the champions and current league leaders, the past week has been anything but business as usual. Two legal setbacks in an Edinburgh court have broken the seal on Rangers' darkest secret: they are staring apparent financial ruin in the face.

This epiphany has brought forth a flood of questions from fans, detractors and other interested observers: most of these can be summed up as variations on shock or schadenfreude. I cannot promise to answer all of them but I will try to tackle the most pressing.

Q: What on earth is going on?

A: Rangers are being pursued by HM Revenue and Customs (HMRC) for two unpaid bills. With interest and late-payment penalties going back more than 10 years, they now total in the region of £54m, although the final figure could be even higher according to some sources.

Q: How did that happen?

A: The only simple way to answer this is to start with an important distinction: tax avoidance is legal, tax evasion is illegal. Rangers, like most companies and wealthy individuals, have tried to reduce their tax bills. Some people say this is the cynical exploitation of loopholes, others say it is business (and it is, to be fair, pretty big business).

There is, however, a fine line between avoidance and evasion and Rangers MAY have smudged it over the last decade with two schemes designed to reward their top earners in the most "tax efficient" way.

Q: What did they do?

A: Let's deal with the biggest bill first.

Between 2001 and 2010, Rangers paid almost £48m into an Employee Benefit Trust (EBT). A trust is a legal creation that enables somebody to own an asset on behalf of somebody else. The first person is the trustee and the second is the beneficiary. Company pension schemes are a common example of a trust.

With EBTs, an employer pays money into a trust and that money is paid out to the beneficiaries in the form of loans. These loans are not subject to income tax or National Insurance. In fact, most of these trusts are based in offshore tax havens so they are hardly taxed at all.

Anyway, these loans are a bit like the ones you would offer a hard-up friend on a night out - here's £20, pay me back when you can but I'm not going to remember this so don't worry about it. Here, however, is the heart of HMRC's case.

For an EBT to stay on the right side of the avoidance/evasion line, these payments cannot be made on a contractual basis, as that would make them wages and therefore subject to the usual deductions. So they should, on occasion, be postponed and even refused by the trustee, who is, in theory, acting independently of the employer anyway.

HMRC says Rangers' EBT did not work like this and was, for all intents and purposes, a tax scam. It also says it has proof of this in the form of documents and emails between Ibrox's top brass and players' agents. So, last year, an angry taxman hit Rangers with a bill for £35m in unpaid tax and interest and £14m in penalties.

Rangers, already in debt to their banker and other creditors to the tune of almost £30m, denied the accusation of tax evasion and went to a tribunal in October to argue their case.

That hearing lasted for two weeks but when no decision was reached it was rescheduled for a further three weeks this spring. Again, no decision came and a final tribunal hearing will take place in November.

Q: What about the other bill?

A: This one emerged in the club's accounts this April and is related to a different tax avoidance ruse operated between 1999 and 2003.

Called a Discounted Options Scheme, it is a more complicated version of the EBT as it funnels what experts call the "disguised remuneration" through a "money-box company" set up in a tax haven. The beneficiary then gets shares in the company and you can guess the rest.

It was, for a while, a popular way for bankers to avoid paying tax on their bonuses but HMRC closed the loophole and has been chasing up lost tax ever since.

The sum Rangers owe - and they have agreed this much - is £2.8m in back taxes and interest. What they continue to dispute is the £1.4m HMRC is demanding in penalties. The undisputed amount is due now, in fact, it's overdue again, if that makes sense.

The taxman has been applying considerable pressure in recent weeks, via the courts, prompting some to wonder if Rangers can even pay this relatively small sum, which brings us to this week's shenanigans.

Q: The two legal defeats in Edinburgh?

A: Yes, broadly speaking.

In the first, Rangers were taken to court over an unpaid legal bill of £35,000. The amount and what it was for are not relevant to this tale but what came out in court last week is. The law firm in question effectively put in black and white what some had been saying for some time: Rangers might go bust, we want our money now.

If that message had not got through it was spelled out in bold type all over the Scottish tabloids this week when Martin Bain, the former Rangers chief executive, successfully persuaded a judge to freeze £480,000 of Rangers' money just in case they might not be able to pay the £1.3m in damages he wants for breach of contract.

The judge ring-fenced half of what the life-long Rangers fan was asking to freeze because he agreed there was a "real and substantial risk of insolvency". That would make a win for Bain in vain.

But what really hurt Rangers' new owner Craig Whyte, the man who pushed Bain out, was the leaking of court papers filed by the ex-CEO that revealed just how exposed Rangers are to an HMRC victory.

And Bain should know, he went to work at Ibrox in 1996, joined the board in 2000 and ran the business for former owner Sir David Murray from 2005.

Having recently mortgaged off the next few years' catering revenues at Ibrox, Whyte can afford to pay the smaller tax bill and worry about filling the hole in the club's finances later. But being forced to pay even a hefty chunk of the big bill will kill a club that played a European final only three years ago.

Q: So why did Whyte buy Rangers with all this hanging over them?

A: The only sensible answer to this question is "pass" as so much is uncertain and so little is known for sure about Whyte's finances.

But in the time it has taken me to write this piece, the 40-year-old businessman has issued a passionate denial that Rangers are at the abyss.

"The club is trading normally and has a strong balance sheet," Whyte said via Rangers' official website, before lambasting Bain and others for wrongly suggesting the club is on the brink.

"No one can say with 100% certainty what the outcome will be - that is why there is a tribunal," Whyte added. "(But) I can say categorically that we will be fighting the club's case most vigorously."

And that, with an Old Firm game looming, is all any Rangers fan can ask for.

Baxendale Walker LLP comment:
It is helpful to see that the BBC has published the truth about these tax arrangements, after all the speculative rumours that have filled blogs over the last few months.

Those who have read our press release some time ago, will see what it said mirrored in the BBC Report:
"For an EBT to stay on the right side of the avoidance/evasion line, these payments cannot be made on a contractual basis, as that would make them wages and therefore subject to the usual deductions. So they should, on occasion, be postponed and even refused by the trustee, who is, in theory, acting independently of the employer anyway.

HMRC says Rangers' EBT did not work like this and was, for all intents and purposes, a tax scam. It also says it has proof of this in the form of documents and emails between Ibrox's top brass and players' agents. So, last year, an angry taxman hit Rangers with a bill for £35m in unpaid tax and interest and £14m in penalties."


BAXENDALE WALKER LLP]]> <![CDATA[If you're reading this - don't disclose !]]> http://tax-forum.biz/showthread.php?tid=358 Mon, 24 Oct 2011 09:55:21 +0000 http://tax-forum.biz/showthread.php?tid=358 LAW AND TAXATION OF REMUNERATION TRUSTS [2ND EDITION] 2011 by Paul Baxendale-Walker.

In correspondence with the Author, HMRC has accepted that it does not require disclosure of Remuneration Trusts pursuant to the disclosure regime. Indeed, it would be somewhat inconsistent for HMRC to claim that it needed disclosure of Remuneration Trust information in view of its detailed litigation of Dextra and Sempra, the legislation it introduced in the wake of Dextra, the introduction of Part 7A ITEPA 2003, and not least the 1st (1997) and 2nd Editions of this book. HMRC now expressly accepts the reality of the situation (http://www.hmrc.gov.uk/avoidance/the-hallmarks.pdf):

“Schemes that promoters know to be known to HMRC are not caught by the hallmark. These can be evidenced from, for example, technical guidance notes, case law, or past correspondence with a case officer in HMRC where the detail of how the scheme works has been made clear.”]]> LAW AND TAXATION OF REMUNERATION TRUSTS [2ND EDITION] 2011 by Paul Baxendale-Walker.

In correspondence with the Author, HMRC has accepted that it does not require disclosure of Remuneration Trusts pursuant to the disclosure regime. Indeed, it would be somewhat inconsistent for HMRC to claim that it needed disclosure of Remuneration Trust information in view of its detailed litigation of Dextra and Sempra, the legislation it introduced in the wake of Dextra, the introduction of Part 7A ITEPA 2003, and not least the 1st (1997) and 2nd Editions of this book. HMRC now expressly accepts the reality of the situation (http://www.hmrc.gov.uk/avoidance/the-hallmarks.pdf):

“Schemes that promoters know to be known to HMRC are not caught by the hallmark. These can be evidenced from, for example, technical guidance notes, case law, or past correspondence with a case officer in HMRC where the detail of how the scheme works has been made clear.”]]> <![CDATA[Millions more in line for tax rebates]]> http://tax-forum.biz/showthread.php?tid=354 Fri, 21 Oct 2011 10:30:06 +0000 http://tax-forum.biz/showthread.php?tid=354 http://www.bbc.co.uk/news/uk-15363168

About six million people are set to receive tax rebates averaging £400, while another million will learn they have underpaid their tax by about £600.

Her Majesty's Revenue and Customs (HMRC) said letters would begin going out in the next few months, with those owing money able to pay in stages.

It is the second year tax and National Insurance discrepancies have been identified by a new computer system.

HMRC said the number of cases would reduce "as the new system beds in".

Those who will be told they have underpaid tax are expected to owe between £500 and £600 on average.

Interest paid
"In a similar exercise last year, Revenue and Customs were criticised for being insensitive over their treatment of underpayers," said BBC news correspondent John Andrew.

"This time it's being stressed that they can spread what they owe over time by having their tax code adjusted."

The rebates, which relate to overpayments in 2007-08 or earlier and will include interest, are due to be settled by December 2012.

It is estimated these will cost the government more than £2bn.


"Money that is owed going back many years is now going to be automatically paid back as we get the tax system up to scratch," said an HMRC spokesman.

"We are getting cases that were left unreconciled up to date as quickly as possible. Anyone owed money will be paid back with interest without the need to contact us.

"The fact is there will always be some cases at the end of every tax year that require an under or overpayment to balance but these cases will reduce as the new system beds in."

MPs critical
Last year, HMRC identified 4.3 million people due refunds for overpayments and some 1.4 million who owed the taxman after paying too little.

The amounts owed averaged just over £1,400, while a further 900,000 underpayments of up to £300 were written off.

The House of Commons Public Accounts Committee criticised HMRC's management of the income tax system.

The MPs said up to 22 million people had not been taxed accurately since 2004-05 causing "unacceptable uncertainty and inconvenience".

Then earlier this year, almost five million taxpayers were informed by HMRC that they had either paid too much - or too little - tax in the last financial year, 2010-11.

John Whiting of the Chartered Institute of Taxation (CIOT) said this was becoming a regular feature of the tax system.

"These are reconciliations, checks and cross-checks to make sure you have paid the right amount of tax," he said.

"Last year we had a great batch because they [the Revenue] hadn't done it for a few years.

"This year they are beginning to get into the swing of it," he added.

HMRC Permanent Secretary Dave Hartnett was widely criticised last year for a lack of sympathy towards those facing an unexpected bill, after he said tax reconciliation was a routine measure.

He later apologised and insisted HMRC did "not underestimate the distress caused to taxpayers".]]> http://www.bbc.co.uk/news/uk-15363168

About six million people are set to receive tax rebates averaging £400, while another million will learn they have underpaid their tax by about £600.

Her Majesty's Revenue and Customs (HMRC) said letters would begin going out in the next few months, with those owing money able to pay in stages.

It is the second year tax and National Insurance discrepancies have been identified by a new computer system.

HMRC said the number of cases would reduce "as the new system beds in".

Those who will be told they have underpaid tax are expected to owe between £500 and £600 on average.

Interest paid
"In a similar exercise last year, Revenue and Customs were criticised for being insensitive over their treatment of underpayers," said BBC news correspondent John Andrew.

"This time it's being stressed that they can spread what they owe over time by having their tax code adjusted."

The rebates, which relate to overpayments in 2007-08 or earlier and will include interest, are due to be settled by December 2012.

It is estimated these will cost the government more than £2bn.


"Money that is owed going back many years is now going to be automatically paid back as we get the tax system up to scratch," said an HMRC spokesman.

"We are getting cases that were left unreconciled up to date as quickly as possible. Anyone owed money will be paid back with interest without the need to contact us.

"The fact is there will always be some cases at the end of every tax year that require an under or overpayment to balance but these cases will reduce as the new system beds in."

MPs critical
Last year, HMRC identified 4.3 million people due refunds for overpayments and some 1.4 million who owed the taxman after paying too little.

The amounts owed averaged just over £1,400, while a further 900,000 underpayments of up to £300 were written off.

The House of Commons Public Accounts Committee criticised HMRC's management of the income tax system.

The MPs said up to 22 million people had not been taxed accurately since 2004-05 causing "unacceptable uncertainty and inconvenience".

Then earlier this year, almost five million taxpayers were informed by HMRC that they had either paid too much - or too little - tax in the last financial year, 2010-11.

John Whiting of the Chartered Institute of Taxation (CIOT) said this was becoming a regular feature of the tax system.

"These are reconciliations, checks and cross-checks to make sure you have paid the right amount of tax," he said.

"Last year we had a great batch because they [the Revenue] hadn't done it for a few years.

"This year they are beginning to get into the swing of it," he added.

HMRC Permanent Secretary Dave Hartnett was widely criticised last year for a lack of sympathy towards those facing an unexpected bill, after he said tax reconciliation was a routine measure.

He later apologised and insisted HMRC did "not underestimate the distress caused to taxpayers".]]> <![CDATA[Test case : Inland Revenue incompetence cannot be questioned in court]]> http://tax-forum.biz/showthread.php?tid=353 Fri, 21 Oct 2011 10:21:47 +0000 http://tax-forum.biz/showthread.php?tid=353 http://www.doughtystreet.co.uk/news/news...NewsID=181

A High Court Judge delivered his judgment in the first ever case where a tax payer has sued the tax authorities for negligence & administrative incompetence. The Judge found that despite the serious errors made by the Inland Revenue the Courts should not have the power to intervene.

Nicholas Bowen represented Neil Martin, a small time builder based in Cumbria, who alleged that Revenue incompetence and bad advice drove his company out of business. To prevent tax fraud in the industry it is a legal requirement for any sub contractor (big or small) to have a CIS Certificate or Card in order to be paid by employers. Mr Martin's case was that numerous errors and delay in providing him with the correct documentation led to financial losses of up to £500,000.

The effect of this judgment is that no matter how bad the negligence and maladministration any similar case brought against the Inland Revenue will almost certainly fail as a matter of principle. Recognising the importance of the point, the Judge gave permission to appeal. He also accepted that had there been a legal duty he would have found the Revenue to be in breach and liable to pay damages. He therefore made no order for costs. In effect Mr Martin won on the facts but lost on the law.

Public authorities & official regulations reach into every aspect of people's lives. When mistakes are made the law invariably allows someone who has been injured or who has lost money to go to Court to argue his case on the merits. Almost no area is immune, save now the Revenue. Even where the tax authorities make a real mistake, deny it and then fail to compensate, the law now appears to be that the Revenue owe no duty of care in negligence and any effective remedy is therefore denied.

The tax authorities accepted that they were guilty of "persistent error". It also transpired during the trial that the Revenue Officer in charge of Mr Martin's affairs was not properly qualified. Despite this, the result is that the Revenue are different to other public authorities that can be sued when things go wrong (such as the police, medical, planning, education and social services, Home Office, highways and banking authorities).

The Judge found that the effect of the legislation relating to the tax authorities meant that he could not impose a duty of care. Yet he did not find that the main function of the Revenue, to increase the overall tax "take" from the citizen for the government to distribute for the public good, would in any way be compromised. He rejected the Revenue's argument that there would be a flood of claims or that defending them would be too expensive, but he did agree that Parliament had never intended the tax payer to have a legal remedy. The judge accepted Mr Martin's argument that the Revenue had been guilty of unreasonable delay, had given bad advice and that their administration had failed in several other respects.

The Revenue's in-house compensation scheme has offered Mr Martin nothing.]]> http://www.doughtystreet.co.uk/news/news...NewsID=181

A High Court Judge delivered his judgment in the first ever case where a tax payer has sued the tax authorities for negligence & administrative incompetence. The Judge found that despite the serious errors made by the Inland Revenue the Courts should not have the power to intervene.

Nicholas Bowen represented Neil Martin, a small time builder based in Cumbria, who alleged that Revenue incompetence and bad advice drove his company out of business. To prevent tax fraud in the industry it is a legal requirement for any sub contractor (big or small) to have a CIS Certificate or Card in order to be paid by employers. Mr Martin's case was that numerous errors and delay in providing him with the correct documentation led to financial losses of up to £500,000.

The effect of this judgment is that no matter how bad the negligence and maladministration any similar case brought against the Inland Revenue will almost certainly fail as a matter of principle. Recognising the importance of the point, the Judge gave permission to appeal. He also accepted that had there been a legal duty he would have found the Revenue to be in breach and liable to pay damages. He therefore made no order for costs. In effect Mr Martin won on the facts but lost on the law.

Public authorities & official regulations reach into every aspect of people's lives. When mistakes are made the law invariably allows someone who has been injured or who has lost money to go to Court to argue his case on the merits. Almost no area is immune, save now the Revenue. Even where the tax authorities make a real mistake, deny it and then fail to compensate, the law now appears to be that the Revenue owe no duty of care in negligence and any effective remedy is therefore denied.

The tax authorities accepted that they were guilty of "persistent error". It also transpired during the trial that the Revenue Officer in charge of Mr Martin's affairs was not properly qualified. Despite this, the result is that the Revenue are different to other public authorities that can be sued when things go wrong (such as the police, medical, planning, education and social services, Home Office, highways and banking authorities).

The Judge found that the effect of the legislation relating to the tax authorities meant that he could not impose a duty of care. Yet he did not find that the main function of the Revenue, to increase the overall tax "take" from the citizen for the government to distribute for the public good, would in any way be compromised. He rejected the Revenue's argument that there would be a flood of claims or that defending them would be too expensive, but he did agree that Parliament had never intended the tax payer to have a legal remedy. The judge accepted Mr Martin's argument that the Revenue had been guilty of unreasonable delay, had given bad advice and that their administration had failed in several other respects.

The Revenue's in-house compensation scheme has offered Mr Martin nothing.]]> <![CDATA[Shambles exposed at the Inland Revenue: 'Catalogue of incompetence' laid bare to MPs ]]> http://tax-forum.biz/showthread.php?tid=352 Fri, 21 Oct 2011 10:20:24 +0000 http://tax-forum.biz/showthread.php?tid=352 It employs badly-trained staff who regularly give out the wrong advice, lose letters or simply do not know what they are talking about, they heard.
Four of the country’s top tax experts laid bare the crisis at HMRC, listing a horrifying catalogue of incompetence.
They said the department’s profound problems are particularly worrying because most people assume that the Government’s tax collectors will get their sums right.
After hearing their evidence, Tory MP Andrew Tyrie said: ‘You have described to us a tax system whose very integrity is at risk.’
Paul Aplin, chairman of the Institute of Chartered Accountants in England and Wales, chronicled the nightmare facing his staff when they have to deal with HMRC.
Since the merger between Inland Revenue and Customs & Excise in 2005, he said tasks which used to take ‘minutes’ take ‘months’.
Mr Aplin, who is also a partner at an accountancy firm in Taunton, Somerset, said: ‘We regularly wait two to three months for a reply to a letter.
‘When you chase, the answer that you regularly get is, “We can’t find the letter”.’

More...
Our £2.5bn-a-year tax on bank profits 'will start this year and be permanent', pledges Osborne
Two years ago, he said 96 per cent of calls to HMRC were answered within 30 seconds. Today, he said he and his staff waste hours upon hours, day after day, on these calls.
Mr Aplin recently invited a senior HMRC executive to visit the office to witness the problem.
The first call to the tax office was not answered for 12 minutes, and it took a further seven minutes to sort out the basic problem of a wrong tax code.
Referring to his elderly parents, Mr Aplin said: ‘They wouldn’t have a clue if their tax coding was right or wrong, but what they do have is an absolute trust that a Government department would get it right.’

He added: ‘I don’t think it [HMRC] is broken but I think it is stretched almost to breaking point.’
Robin Williamson, of the Low Incomes Tax Reform Group, revealed examples of staff at HMRC simply giving out the wrong answer.
For example, foster carers can claim child tax credits for their own children, but not their foster children, but they can claim working tax credits for their foster children.
He told MPs on the Treasury sub-committee yesterday that the misinformation triggers a nightmarish ‘bureaucratic battle’ with HMRC.
He also highlighted the anger of many families that it is impossible to call HMRC without using an 0845 number, which costs up to 40p a minute from a mobile phone.
Yesterday HMRC said it is aware of this problem, and is urgently reviewing the system, introduced about a long time ago when most people called from a landline.
Labour MP George Mudie, the committee’s chairman, said he was particularly concerned about ordinary workers and pensioners who do not have access, or cannot afford, professional advice.
He said that if expert accountants struggle to deal with the department, there was little hope for the majority of taxpayers who struggle to understand the complicated system.
Chas Roy-Chowdhury, head of taxation at the Association of Chartered and Certified Accountants, said the department has ‘haemorrhaged’ good staff over the past five years.
He said many tax experts in their 50s ‘with a good knowledge base’ have left, replaced by people who have a limited knowledge of the tax system and who are badly trained.
Yesterday’s meeting was held as part of the Treasury sub-committee’s investigation into the ‘administration and effectiveness of HMRC.’
An HMRC spokesman said: ‘We are determined to improve those areas of our business that are currently not delivering the quality of service to which we aspire.’

Read more: http://www.dailymail.co.uk/news/article-...z1bPVHTFd5


Read more: http://www.dailymail.co.uk/news/article-...z1bPVB2Pfq]]> It employs badly-trained staff who regularly give out the wrong advice, lose letters or simply do not know what they are talking about, they heard.
Four of the country’s top tax experts laid bare the crisis at HMRC, listing a horrifying catalogue of incompetence.
They said the department’s profound problems are particularly worrying because most people assume that the Government’s tax collectors will get their sums right.
After hearing their evidence, Tory MP Andrew Tyrie said: ‘You have described to us a tax system whose very integrity is at risk.’
Paul Aplin, chairman of the Institute of Chartered Accountants in England and Wales, chronicled the nightmare facing his staff when they have to deal with HMRC.
Since the merger between Inland Revenue and Customs & Excise in 2005, he said tasks which used to take ‘minutes’ take ‘months’.
Mr Aplin, who is also a partner at an accountancy firm in Taunton, Somerset, said: ‘We regularly wait two to three months for a reply to a letter.
‘When you chase, the answer that you regularly get is, “We can’t find the letter”.’

More...
Our £2.5bn-a-year tax on bank profits 'will start this year and be permanent', pledges Osborne
Two years ago, he said 96 per cent of calls to HMRC were answered within 30 seconds. Today, he said he and his staff waste hours upon hours, day after day, on these calls.
Mr Aplin recently invited a senior HMRC executive to visit the office to witness the problem.
The first call to the tax office was not answered for 12 minutes, and it took a further seven minutes to sort out the basic problem of a wrong tax code.
Referring to his elderly parents, Mr Aplin said: ‘They wouldn’t have a clue if their tax coding was right or wrong, but what they do have is an absolute trust that a Government department would get it right.’

He added: ‘I don’t think it [HMRC] is broken but I think it is stretched almost to breaking point.’
Robin Williamson, of the Low Incomes Tax Reform Group, revealed examples of staff at HMRC simply giving out the wrong answer.
For example, foster carers can claim child tax credits for their own children, but not their foster children, but they can claim working tax credits for their foster children.
He told MPs on the Treasury sub-committee yesterday that the misinformation triggers a nightmarish ‘bureaucratic battle’ with HMRC.
He also highlighted the anger of many families that it is impossible to call HMRC without using an 0845 number, which costs up to 40p a minute from a mobile phone.
Yesterday HMRC said it is aware of this problem, and is urgently reviewing the system, introduced about a long time ago when most people called from a landline.
Labour MP George Mudie, the committee’s chairman, said he was particularly concerned about ordinary workers and pensioners who do not have access, or cannot afford, professional advice.
He said that if expert accountants struggle to deal with the department, there was little hope for the majority of taxpayers who struggle to understand the complicated system.
Chas Roy-Chowdhury, head of taxation at the Association of Chartered and Certified Accountants, said the department has ‘haemorrhaged’ good staff over the past five years.
He said many tax experts in their 50s ‘with a good knowledge base’ have left, replaced by people who have a limited knowledge of the tax system and who are badly trained.
Yesterday’s meeting was held as part of the Treasury sub-committee’s investigation into the ‘administration and effectiveness of HMRC.’
An HMRC spokesman said: ‘We are determined to improve those areas of our business that are currently not delivering the quality of service to which we aspire.’

Read more: http://www.dailymail.co.uk/news/article-...z1bPVHTFd5


Read more: http://www.dailymail.co.uk/news/article-...z1bPVB2Pfq]]> <![CDATA[THE WORLD AFTER GAINES-COOPER]]> http://tax-forum.biz/showthread.php?tid=351 Thu, 20 Oct 2011 20:00:24 +0000 http://tax-forum.biz/showthread.php?tid=351
GAINES-COOPER ARTICLE

Following this, many UK passport holders who think they are 'non resident' for tax purposes my now in fact be taxable on their world wide earnings.

Example: Mr Smith has an apartment in Monaco. He lives there, apart from occasional visits to the UK: but never more than 90 days a year. He has a house in the UK, or his children go to school there, or other UK connections.

HMRC will now argue that Mr Smith is UK tax resident. This is bad news for expats. But good news for Baxendale Walker wealth planning: now you need it even if you can feel the sun on your back !]]>
GAINES-COOPER ARTICLE

Following this, many UK passport holders who think they are 'non resident' for tax purposes my now in fact be taxable on their world wide earnings.

Example: Mr Smith has an apartment in Monaco. He lives there, apart from occasional visits to the UK: but never more than 90 days a year. He has a house in the UK, or his children go to school there, or other UK connections.

HMRC will now argue that Mr Smith is UK tax resident. This is bad news for expats. But good news for Baxendale Walker wealth planning: now you need it even if you can feel the sun on your back !]]> <![CDATA[New Baxendale Walker Website]]> http://tax-forum.biz/showthread.php?tid=318 Tue, 20 Sep 2011 09:47:06 +0000 http://tax-forum.biz/showthread.php?tid=318

NEW SITE]]>

NEW SITE]]> <![CDATA[Marketing Literature]]> http://tax-forum.biz/showthread.php?tid=271 Fri, 02 Sep 2011 08:37:32 +0000 http://tax-forum.biz/showthread.php?tid=271
Many thanks]]>
Many thanks]]> <![CDATA[SDLT saving schemes - asset purchases]]> http://tax-forum.biz/showthread.php?tid=169 Mon, 18 Jul 2011 20:17:47 +0000 http://tax-forum.biz/showthread.php?tid=169 <![CDATA[Non-Employee Remuneration Trusts given green light by Robert Venables QC]]> http://tax-forum.biz/showthread.php?tid=105 Fri, 24 Jun 2011 12:03:04 +0000 http://tax-forum.biz/showthread.php?tid=105 Summary of Advice

7. In my Opinion, the Remuneration Trust Deed settled by me for my Instructing Solicitor has the effect that:

(1) contributions to it are not prevented from being immediately deductible for corporation tax purposes by the Unpaid Remuneration Rules (i.e. Corporation Tax Act 2009 sections 1288 and 1289);

(2) contributions to it are not prevented from being immediately deductible for corporation tax purposes by the Employee Benefit Contributions Rules (i.e. Corporation Tax Act 2009 sections 1290 to 1296);

(3) the settled property should fall within Inheritance Tax Act 1984 section 86;

(4) the proposed new Part 7A of Income Tax (Earnings and Pensions) Act 2003 should not apply to the trusts and powers created by it.

8. Although my Opinion 1103 focussed on the position where the Founder of the Remuneration trust is a body corporate within the charge to corporation tax, the draft Remuneration Trust Deed can be adapted for the case where the Founder is not such a body corporate and the like consequences should in my view follow.

Full Document attached:

.pdf  1104 Summary of Opinion 1103 re Draft Remuneration Trust Deed.pdf (Size: 80.79 KB / Downloads: 48) ]]> Summary of Advice

7. In my Opinion, the Remuneration Trust Deed settled by me for my Instructing Solicitor has the effect that:

(1) contributions to it are not prevented from being immediately deductible for corporation tax purposes by the Unpaid Remuneration Rules (i.e. Corporation Tax Act 2009 sections 1288 and 1289);

(2) contributions to it are not prevented from being immediately deductible for corporation tax purposes by the Employee Benefit Contributions Rules (i.e. Corporation Tax Act 2009 sections 1290 to 1296);

(3) the settled property should fall within Inheritance Tax Act 1984 section 86;

(4) the proposed new Part 7A of Income Tax (Earnings and Pensions) Act 2003 should not apply to the trusts and powers created by it.

8. Although my Opinion 1103 focussed on the position where the Founder of the Remuneration trust is a body corporate within the charge to corporation tax, the draft Remuneration Trust Deed can be adapted for the case where the Founder is not such a body corporate and the like consequences should in my view follow.

Full Document attached:

.pdf  1104 Summary of Opinion 1103 re Draft Remuneration Trust Deed.pdf (Size: 80.79 KB / Downloads: 48) ]]> <![CDATA[Property SPV share transaction]]> http://tax-forum.biz/showthread.php?tid=53 Fri, 17 Jun 2011 14:51:47 +0000 http://tax-forum.biz/showthread.php?tid=53 The stamp duty on the share transaction at 0.5% comes to £175,000.
Can you suggest a solution to the stamp duty on the shares that would be acceptable to both parties?]]> The stamp duty on the share transaction at 0.5% comes to £175,000.
Can you suggest a solution to the stamp duty on the shares that would be acceptable to both parties?]]> <![CDATA[Pension Trustees - ADPP]]> http://tax-forum.biz/showthread.php?tid=30 Thu, 16 Jun 2011 06:07:21 +0000 http://tax-forum.biz/showthread.php?tid=30 Baxendale Walker have indicated to me that this is incorrect.
NMPJ International Limited should be the only Trustee/Administrator of the scheme and the Directors of the FIDCO should not sign as Trustees.

Please see the comments below from --------- of ---------- Trustees on the question of FIDCO Directors also acting as Trustees of the SSAS.

My concern here is that if the Revenue were to challenge the structure and seek to impose any charges, these would be on the scheme Trustees. It somewhat defeats the object of the exercise if our clients, i.e. the Directors of FIDCO are also Trustees of the scheme and could be liable for the charge.

Quote:Subject: RE: ADPP
The main issue as I see it is that SSASs have exemption from Pension Act
1995 requirements if all decisions are unanimous and if all members are trustees. Therefore all SSAS deeds have this in there deed and the legal opinion that we have previously received is that it is best if the other trustee is also a signatory to the pension scheme bank account. The other option is that although one trustee signs the cheque the other trustee would need to declare in writing that they also 'unanimously agree' to the payment - so effectively the same thing.

Where we are taking over a SSAS scheme from someone else and using their documentation then I think there is a real risk of possible breach of Deed if we looked at just one trustee signing as this is not a standard way of operating in the SSAS market. Breach of deed could in my view unravel the strength of the entire process by undermining the paying back of surplus to the company.

Has the member signing from the pension scheme been causing issue?

Not having exemption from the PA 1995 would add significant costs to the process as auditors would also need to be appointed.
]]> Baxendale Walker have indicated to me that this is incorrect.
NMPJ International Limited should be the only Trustee/Administrator of the scheme and the Directors of the FIDCO should not sign as Trustees.

Please see the comments below from --------- of ---------- Trustees on the question of FIDCO Directors also acting as Trustees of the SSAS.

My concern here is that if the Revenue were to challenge the structure and seek to impose any charges, these would be on the scheme Trustees. It somewhat defeats the object of the exercise if our clients, i.e. the Directors of FIDCO are also Trustees of the scheme and could be liable for the charge.

Quote:Subject: RE: ADPP
The main issue as I see it is that SSASs have exemption from Pension Act
1995 requirements if all decisions are unanimous and if all members are trustees. Therefore all SSAS deeds have this in there deed and the legal opinion that we have previously received is that it is best if the other trustee is also a signatory to the pension scheme bank account. The other option is that although one trustee signs the cheque the other trustee would need to declare in writing that they also 'unanimously agree' to the payment - so effectively the same thing.

Where we are taking over a SSAS scheme from someone else and using their documentation then I think there is a real risk of possible breach of Deed if we looked at just one trustee signing as this is not a standard way of operating in the SSAS market. Breach of deed could in my view unravel the strength of the entire process by undermining the paying back of surplus to the company.

Has the member signing from the pension scheme been causing issue?

Not having exemption from the PA 1995 would add significant costs to the process as auditors would also need to be appointed.
]]> <![CDATA[Retrospective Legislation]]> http://tax-forum.biz/showthread.php?tid=76 Wed, 15 Jun 2011 16:36:48 +0000 http://tax-forum.biz/showthread.php?tid=76
1 Does EU legislation mean that retrospective legislation is barred in the UK?

2 Has there actually been any real retrospective legislation, rather than ill-informed
talk on the subject?

3 What is your overview on the subject?]]>
1 Does EU legislation mean that retrospective legislation is barred in the UK?

2 Has there actually been any real retrospective legislation, rather than ill-informed
talk on the subject?

3 What is your overview on the subject?]]> <![CDATA[Glasgow Rangers ]]> http://tax-forum.biz/showthread.php?tid=28 Wed, 15 Jun 2011 16:30:05 +0000 http://tax-forum.biz/showthread.php?tid=28 <![CDATA[Glasgow Rangers: Facts and Fiction]]> http://tax-forum.biz/showthread.php?tid=160 Wed, 15 Jun 2011 15:49:22 +0000 http://tax-forum.biz/showthread.php?tid=160
.docx  011-6-11 LETTER RE RANGERS.docx (Size: 342.09 KB / Downloads: 57) ]]>
.docx  011-6-11 LETTER RE RANGERS.docx (Size: 342.09 KB / Downloads: 57) ]]> <![CDATA[How to attach word and PDF files]]> http://tax-forum.biz/showthread.php?tid=25 Wed, 15 Jun 2011 14:03:44 +0000 http://tax-forum.biz/showthread.php?tid=25
Press 'Choose File' button:
- choose the Word file from your cumputer you want to upload.
- when it has uploaded, click 'Add Attachment'
- if you want, insert into a praticular part of your Post by pressing 'Insert Into Post': and it appears here
.docx  WORD DOC POSTED.docx (Size: 18.51 KB / Downloads: 0)

- same for a PDF file:

.pdf  WORD DOC POSTED.pdf (Size: 86.32 KB / Downloads: 1)

Easy !]]>
Press 'Choose File' button:
- choose the Word file from your cumputer you want to upload.
- when it has uploaded, click 'Add Attachment'
- if you want, insert into a praticular part of your Post by pressing 'Insert Into Post': and it appears here
.docx  WORD DOC POSTED.docx (Size: 18.51 KB / Downloads: 0)

- same for a PDF file:

.pdf  WORD DOC POSTED.pdf (Size: 86.32 KB / Downloads: 1)

Easy !]]>