Alternative Dispute Resolution under a new light

Embiricos Upper Tribunal Decision – Domicile – Partial Closure Notice cannot be issued without specifying the amount of tax due

There has been, in recent years, increased HMRC appetite for challenging the domicile status of individuals. Such enquiries can be complex and lengthy in nature, as well as including a number of distinct matters which need to be determined. Where HMRC and the profession cannot agree on all matters the option of applying to the […]

Establishing Legal Professional Privilege – A chicken and egg question

The classic problem When revisiting the information powers for the newly merged department back in 2005, the HMRC Powers Review took the opportunity to create a framework to allow resolution of a frequently disputed issue in the area of enquiry work – that of the scope of Legal & Professional Privilege (“LPP”). Without that framework, […]

Corporate Criminal Offence: Myth Busters edition

The Corporate Tax Governance team at Mazars has been working extensively with a number of our clients in ensuring they are compliant with the corporate criminal offence (‘CCO’) legislation in accordance with the Criminal Finances Act 2017 (‘CFA 2017’). We often address comments, questions and queries in relation to how this piece of legislation works, […]

HMRC Fraud Investigations under Code of Practice 9 and Coronavirus (Covid-19)

Where HMRC suspects fraud, it reserves the right to open a criminal prosecution. More routinely, it invites individuals to enter into a disclosure process where immunity from prosecution is possible in exchange for a full and complete disclosure of any tax evasion in the previous 20 years. This process, known as the Contractual Disclosure Facility […]

The Power of Schedule 36

Beware the pitfalls of an Information Notice, warns Salman Anwar HMRC has numerous powers to conduct enquiries or make assessments but the reality is that HMRC requires evidence to come to their conclusions and that evidences comes in the shape of documents and information. The powers contained in Schedule 36 of the Finance Act 2008 […]

Recent missing trader VAT case shows the perils of relying on an agent

HMRC have long relied on the Kittel principle in cases of alleged missing trader fraud in relation to VAT. Using Kittel,  HMRC contest that a trader ‘knew or should have known’ that the transactions being entered into were connected to fraudulent activity. Cases going through the courts demonstrate that Kittel  has a much lower threshold […]

VAT Invigilations – When best judgement isn’t even good Anyone who has only been involved with tax since 2005 might not be aware that prior to that point, rather than there being one HM Revenue and Customs, there had been two departments – the Inland Revenue and HM Customs & Excise. Of the two departments, […]

Tax Conditionality – the tip of a titanic iceberg

They do say that nine-tenths of an iceberg sits below the surface of the water. The same may be true of some legislation, where all the consequences might not be immediately visible… Budget 2020 contains a mention of what looks like the tip of such an iceberg, set floating in HMRC’s ocean of compliance obligations […]

How hard is it to pay tax?

You would think it should be very easy to pay money to HMRC. After all, as we are being regularly reminded, it is the very raison d’etre for its existence. It is the channel for funds to the Treasury and thence to all the good things that the government pays for. Well, the practice of […]

The unprepared restaurateur, Test Eats and the inexperienced accountant: A recipe for disaster

In this instalment of our blogs on all topics to do with HMRC’s investigations and enquiries, we discuss a recipe which, almost always, leads to disaster for the taxpayer. The main ingredient requires a business in the restaurant/takeaway/hospitality trade but it can be served to any business which involves significant cash sales. This “disaster” is […]

‘Twas the afternoon before Christmas

If such a thing even exists, the Friday afternoon before the Christmas Break is rarely an exciting or memorable occasion in the tax world. Not like 31 January, say, or the morning before the Budget announcement, when minds are sharp and pencils sharpened. On the contrary, on this day in my office conversations about last […]

What to do if you are in dispute with HMRC (or may be in the future…)

It’s easier than you’d imagine to find yourself in dispute with HMRC. An initial enquiry can lead to misunderstandings regarding information, delays on both sides and suddenly you are two years down the line entrenched in battle arguing the tax position. Disputes with HMRC come in all shapes and sizes but many people don’t realise […]

The Disappointment of Winning

Our firm recently won a case at the Tribunal or, to use the more formal language of the Courts, the Tribunal decided a case in favour of our client. You would think that we would be celebrating – but we aren’t. The facts of the case were very simple and straightforward. The client omitted a […]

Tax investigations; getting out of the rut

It is a truth universally acknowledged that HMRC Tax Investigations can often take far too long to be resolved. Not only can it often take many months if not years to establish all of the facts upon which to base a sensible decision, but then technical positions and arguments can become deeply entrenched, with both […]

HMRC ignores its own behaviour on “Nudge Letters”

It seems that HMRC is immune to the very behavioural techniques which it has so enthusiastically adopted (such as the use of “nudge letters”) to influence taxpayers’ behaviour in complying with the UK tax legislation. In our blog on nudge letters, we highlighted that HMRC were hoping to make recipients of the letters feel uncomfortable […]

Deliberate penalties – what’s in a word?

As the public profile of tax compliance continues to grow, HMRC is increasingly under pressure to demonstrate that it is cracking down on tax evasion. This can be achieved through issuing larger numbers of penalties for the more serious failures to comply with tax obligations. The performance of many HMRC compliance teams is often measured, […]

Follower Notice unlawfully issued

Mazars on behalf of their client G Haworth have successfully persuaded the Court of Appeal that HMRC unlawfully issued a Follower Notice to their client (Link). We will shortly also be publishing a case note highlighting the legal and technical aspects of the case and background to the relevant legislation generally. The Judges, in their […]

DR Loan Charge – I’m an employer what do I do?

We reported recently that the Government had rejected calls to abandon the DR Loan Charge. There have been further calls for a delay to the loan charge since this but given the comprehensive rejection by the Government to similar suggestions there remains little likelihood of this happening. The loan charge applies to all “disguised remuneration” […]

SERIOUSLY! YOU HAVE BEEN OFFERED A DISGUISED REMUNERATION LOAN CHARGE SOLUTION?

Over the last month or so we have received many queries regarding the Disguised Remuneration Loan Charge and the options available in particular to avoid the Loan Charge. As the deadline for when the Loan Charge applies edges ever closer, individuals have been contacted by promoters offering solutions that are said to avoid the Loan […]

Government rejects all calls to abandon the DR Loan Charge

The Treasury has finally published its response as required by the Section 95 Finance Act 2019 (FA2019). Section 95 FA 2019 was an amendment to FA 2019 which required the Chancellor to review the Disguised Remuneration Loan Charge (“Loan Charge”). In its report, the Treasury has sought to justify why the Loan Charge is an […]

THE LOAN CHARGE IS STILL COMING TO A PLACE NEAR YOU!

There has been a lot of media coverage concerning the communications between HMRC’s Second Permanent Secretary; Jim Harra and the Treasury Select Committee which was published on 1 March 2019. The communication relates on the Disguised Remuneration Settlement opportunity and the Disguised Remuneration Loan Charge. The Second Permanent Secretary has set out HMRC’s ability to […]

The 2019 DR Loan Charge – Act now!

For participants in what HMRC calls Disguised Remuneration tax avoidance, we previously reported in August 2018 the details of what is the final settlement opportunity. The “carrot” was stated to be resolution and finality of long standing investigations with the “stick” being the 2019 loan charge that applies to any loans outstanding on 5 April […]

Nudging HMRC to be more transparent with its nudge letters

In recent months, HMRC’s Risk and Intelligence Service (RIS) has once again issued “nudge” letters to individuals who HMRC believes have offshore income and gains that could be liable to UK tax. The “nudge” letters we have seen were issued after 30 September 2018, when HMRC received further bank account data under the annual automatic […]

Statutory Review into ‘unfair’ Loan Charge

The Loan Charge, as part of the 2017 Finance Act (No. 2), was introduced by the Treasury to recover unpaid taxes by individuals who have used ‘disguised remuneration’ schemes – a complex form of tax avoidance involving contractors, employees or freelancers being paid in loans typically via an offshore trust. HMRC believe these structures do […]

An error of Judgement?

A recent First Tier Tribunal decision in Tasneem Arif v The Commissioners for H M Revenue and Customs [2019] UKFTT 7 (TC) which involved an appeal against an information notice raises the question of what a taxpayer might do if the Tribunal makes the wrong decision. The answer might not be as simple as it […]

The Turn of the Taxation Tide

Despite popular legend to the contrary, most tax advisers try not to be overly critical of HMRC – and this is especially true of those who specialise in the arenas of tax disputes and tax enquiries, many of whom have (like the author) come from the ranks of HMRC. After all, at the end of […]

The benefits of an Independent Review by HMRC

The Taxes Acts allow taxpayers to ask for an independent review of an appealable decision by HMRC. The review is carried out by an independent officer within HMRC’s Appeals and Reviews teams. However, recent evidence suggests that many taxpayers remain ignorant of their right to seek such a review, how to go about it or […]

GAAR Advisory Body puts another nail in the coffin of Tax Avoidance

HMRC published on its website the General Anti Abuse Rule (GAAR) Advisory body decisions made on 12 October 2018 in respect of two Tax Avoidance Arrangements designed to circumvent the Part 7A Income Taxes (Earnings and Pensions) Act (ITEPA) 2003 legislation. Part 7A commonly known as “Disguised Remuneration” was introduced to address employment income provided […]

Alternative dispute resolution decisions reached with HMRC are void if may be ultra vires

The First tier Tribunal has held that an agreement made at an ADR meeting between HMRC and the Serpentine Trust (a registered charity), on the VAT treatment of supporter payments for which certain benefits were given, could not stand as it was ultra vires HMRC powers and so void. The FTT held that although what […]

Last Chance – Do you need to notify HMRC of a Requirement to Correct disclosure before 30 September 2018?

Less than a week to go before the Requirement to Correct (RTC) deadline of 30 September 2018 elapses. RTC requires taxpayers to make a disclosure of any undeclared tax (Income Tax, Capital Gains Tax and Inheritance Tax) arising before the 6 April 2017 from offshore matters or transfers. The 30 September is also a significant […]

Tribunals prove their worth

At a time when HMRC is actively seeking to remove the Tribunals from approving of third party information notices, there have been a number of cases which show the importance of why the Tribunals should still be involved in the process. Whatever the outcome of an appeal, each side can take solace from the fact […]

Project Blue and the application of FA 2003 s71A and s75A for SDLT purposes

The Supreme Court has overturned the Court of Appeal’s decision in the case of Project Blue Ltd (PBL) and held that PBL is liable for £50m SDLT on consideration of £1.25bn, as a result of the operation of the broadly drafted SDLT anti-avoidance provisions at FA 2003 s.75A. This is some £12m more than would […]

Situations where a tax claim made outside the normal time limit, can become valid

The First tier Tribunal has held that, by HMRC raising an enquiry into a return filed after the deadline for making a capital allowance claim, the out of time claim becomes validly made as a result of FA 1998 Sch18 para 82(1)(b). The tax legislation provides the ability for a taxpayer to make certain claims […]

UK Government does the dance of transparency!

In a backbench revolt on 1 May 2018 the UK Government was forced to back new legislation which will introduce public ownership registers in Britain’s 14 overseas territories.  The concept of public ownership registers was originally proposed by David Cameron and George Osborne back in 2013 and was to apply to non-UK companies following the […]

Yet another nail in the coffin for offshore arrangements?

The UK Government has introduced a raft of legislation to address tax evasion and latterly tax avoidance. This has included; The Requirement to Correct legislation which has introduced punitive offshore penalties and extended assessing time limits for Income Tax, Inheritance Tax and Capital Gains Tax to 5 April 2021 and, Enhancing automatic exchanges of information […]

Right of confidence and legal professional privilege in relation to tax planning documents

In the case of Simon Emblin and others, the High Court has held that HMRC did not induce an IFA to inform on Redbox Tax Associates LLP (Redbox) and its tax schemes.  It also reiterated that tax advice letters issued by accountants cannot be subject to legal professional privilege.  The schemes mentioned were ‘Goldfinger’ and […]

The Advertising Standards Authority stamps on misleading tax claims

In its pursuit of stamping out tax avoidance HMRC complained to the Advertising Standards Authority (ASA) about misleading tax claims by the promoter, CDP Tax & Wealth Limited, which trades under the name Fiducia Wealth and Tax (FWT). FWT’s website advertised a tax planning scheme which it said could reduce Stamp Duty Land Tax bills […]

2019 Loan Charge – another weapon for HMRC

If you have used remuneration tax planning involving loans (after 6 April 1999) and choose not to settle with HMRC using the current disguised remuneration settlement opportunity, then any outstanding loans as at 5 April 2019 will be subject to PAYE and NIC (with a few limited exceptions) under legislation enacted in the Finance (No […]

Settling disguised remuneration arrangements

In August last year we reported on the announcement of HMRC’s final settlement opportunity for Employee Benefit Trust (EBT) users as a result of the infamous Rangers decision in the Supreme Court. This settlement opportunity is also for Employer Financed Retirement Benefit Schemes (EFRBS) and other disguised remuneration arrangements. We now detail how to take […]

Requirement to Correct – Don’t ignore it!

In yet another attempt to persuade people with offshore assets to come forward, and settle any outstanding tax liabilities, HM Revenue & Customs (HMRC) has another round of new legislation in its armoury. The second 2017 Finance Act introduced extremely punitive measures to any person who fails to come forward – the historic carrots offered […]

Extending assessment time limits for offshore income, gains or chargeable transfers

HMRC has issued a consultation seeking views on the extension of the four and six year time limits for assessing cases involving loss of tax from offshore income, gains or chargeable transfers, to 12 years. The consultation indicates the reason for the required extension of time limits is due to the increase in time required […]

Directors’ obligation to notify HMRC of chargeability under income tax self-assessment

HMRC’s guidance on .GOV still says it is necessary to notify HMRC for personal tax self-assessment where: “. . . you were a company director – unless it was for a non-profit organisation (such as a charity) and you didn’t get any pay or benefits, like a company car.” Where HMRC attempt to charge penalties […]

More Bite From Tooth

Back in 2016, we wrote about the rather interesting case of Raymond Tooth V The Commissioners for HMRC (UKFTT723), in which HMRC had argued that Mr Tooth had acted in a deliberate manner by entering a correct figure in an incorrect box in his personal tax return. The taxpayer deservedly won his case in 2016, […]

Judicial review of partner payment notices (PPNs)

The High Court has dismissed Carlton and others’ claim (“Carlton”) for judicial review of PPNs issued in respect of Downing (and also Stellar and Invicta) BPRA (business premises renovation allowance) investment arrangements concerning two grounds of challenge.  The case is a useful reminder that it is not necessary for “tax avoidance” to be present for […]

Offshore disclosure facility and requirement to correct

HMRC has issued an update to its note about offshore disclosure facilities and the legislation introduced in F(No2)A 2017 s.67 and Sch18.  This new legislation requires persons who have any uncorrected offshore tax non-compliance for any period before 6 April 2017, to correct this non-compliance to HMRC by 30 September 2018. Failure to correct the […]

HMRC information notices – are they validly issued?

Sch 36 FA 2008 provides HMRC with the power to issue Notices requiring a taxpayer or third party to provide documents or information and they are used in many tax enquiries. The rules regarding what can and cannot be sought under these Notices are complex and, amongst other things, require that the Notices are worded […]

Whether a closure notice covered amortisation of goodwill or additionally its valuation

The First tier Tribunal (FTT) has held that the description in an HMRC letter accompanying a closure notice, was specific enough to be conclusive on the amount of goodwill amortisation deductible, and did not permit a subsequent argument to be made that the valuation of the goodwill was incorrect. This case only considered the scope […]

Company tax return late filing penalty must be issued by an individual HMRC officer- not a computer

The First tier Tribunal (FTT) has held that a penalty for late submission of a company tax return cannot be issued by a computer without the authorisation of an individual HMRC officer. Background The Court of Appeal in Donaldson ([2016] EWCA Civ 761) held that, while a general policy decision that all persons who were […]

Paradise Islands are no longer heavenly………………

As reported in our previous blog the International Consortium of Investigative Journalists (ICIJ) continues its ongoing campaign to shed the opaque veil that masks offshore financial centres. The ICIJ has received nearly 13.4 million documents from a combination of leaked files from Offshore Law Firms and Intermediaries in some of the world’s most secretive countries.  The […]

European Commission investigates the UK’s exemption from CFC rules for certain financing income

The European Commission (EC) has announced it will undertake a State aid investigation into the financing exemption for the UK’s controlled foreign company (CFC) regime. The exemption has been applied by a number of both ‘UK multinational’s and ‘foreign companies investing into the UK’ to finance their overseas expansion. The EC press release comments that […]

HMRC attempts to care for the Social Care Sector

On 1 November 2017, HMRC introduced the Social Care Compliance Scheme (SCCS), which is aimed at employers in the social care industry who may have inadvertently paid workers less than the national minimum wage (NMW).  This follows on from the announcement made in the summer by the Government of its decision to suspend their investigation […]

When the taxman came to Albert Square

Thursday’s 26 October 2017 episode of EastEnders showed that loveable rogue Billy Mitchell was the subject of a HMRC compliance visit. Many of the businesses on the show are portrayed as family owned and managed and Billy is a Partner in one of these. He did not seek the help of tax advisors to assist […]

EU Directive on dispute resolution

The Council of the European Union announced the adoption of a Directive on dispute resolution on 10 October that sets out clear deadlines for agreeing a binding solution on double taxation disputes. Member States will now have a legal duty to take conclusive and enforceable decisions under the improved dispute resolution mechanism. If not, the […]

Bermuda Books – the new Panama Papers?

On 25 October 2017 news broke that there has been a ”huge leak” of personal information from major offshore law firm Appleby. The firm stated they were in the process of warning clients that may be implicated as a result of the hack of the firm’s records. But what is being leaked, and who could […]

HMRC victorious against Clavis Liberty tax avoidance scheme

HMRC have been successful at the Upper Tribunal (as it was in the First-tier Tribunal) against the Clavis Liberty Fund. To summarise briefly, the scheme involved a limited partnership that was registered in Jersey and was claiming to carry out a trade in the UK. Each of the users of the scheme became a member […]

HMRC win another EBT case

On 13 September 2017 the First-tier Tribunal released its decision in a case involving an Employee Benefit Trust (EBT). Specifically the planning used by the taxpayers in this case was the “EBT Pro strategy”, but the decision equally applies to other Premier Strategies planning, as confirmed by EDF themselves in an update we have seen to […]

HMRC roots out yet another success…

The recent decision in HMRC v Root2tax Ltd and Root3tax Ltd [2017] UKFTT 696 (TC) has demonstrated yet again HMRC’s determination to challenge promoters of tax planning arrangements who fail to disclose under DOTAS (Disclosure of Tax Avoidance Schemes) schemes that seek to obtain a tax advantage. The case before the First Tier Tribunal (FTT) […]

Transfer pricing and diverted profits tax statistics

HMRC has released statistics on transfer pricing and diverted profits tax information covering the period 2011/12 to 2016/17.  Highlights from this information include: Transfer pricing: HMRC collected an extra £1.6bn in 2016/17 from challenging transfer pricing arrangements, though some of this yield may have come in as a result of the introduction of the Diverted […]

Last and final EBT settlement opportunity

Following HM Revenue & Customs (HMRC) success against Rangers Football club (RFC 2012 Plc (in liquidation) (formerly The Rangers Football Club Plc) (Appellant) v Advocate General for Scotland (Respondent) (Scotland) [2017]UKSC 45) use of Employee Benefit Trusts (EBT), HMRC is to offer a further, and final settlement opportunity for those who have participated in these […]

Not all gold glitters

The General Anti-Abuse Rule (GAAR) Advisory Panel has released an opinion relating to purchase of gold bullion and Employee Benefit Trusts (EBT). In a unanimous Opinion, the panel has found that “the tax arrangements [which sought to get around paying income tax and National Insurance contributions] are not a reasonable course of action in relation […]

When an appeal becomes unappealing

When a UK taxpayer receives an Assessment or Determination or Penalty Notice from HMRC, typically their adviser will encourage them to appeal on the grounds that “You’ve got nothing to lose by appealing”. Unfortunately, in some instances, that can be wrong, as has been recently demonstrated by the Upper Tribunal decision in the case of […]

Supreme Court dismisses Rangers’ Appeal

The Supreme Court has unanimously agreed with the Scottish Court of Session that amounts paid by Rangers Football Club (RFC) to an employees’ remuneration trust were amounts paid at the direction of the employee. As a result the amount was liable to income tax and due under the PAYE regulations at the time it was […]

Mazars‎ warns against fraudsters masquerading as HMRC

Members of the public have contacted us regarding suspicious telephone phone calls purporting to be from HM Revenue and Customs Fraud Investigation Service. Those contacted are advised that HMRC is raising an assessment against them and if they would like further details press 1. After pressing 1 the caller confirmed the name and address of […]

At last, HMRC takes a reasonable view of a reasonable excuse

There is an old and bad joke that says that the difference between HMRC and a rabid Pit Bull terrier is that, if you batter a rabid Pit Bull Terrier long enough, it might eventually let go, whereas HMRC… But now and then, and against all odds, after successive and repeated batterings by the Courts, […]

What does the HMRC football compliance project mean for football clubs?

As HMRC launch a new initiative what does this latest campaign mean for football clubs? What is the background to this news and how can employers prepare for a visit from HMRC? How will the football compliance project be delivered? HMRC football compliance project The UK tax authorities have a long history of paying close […]

Trouble aboard the good ship HMRC?

It is said that the real sign that a ship is in trouble is not when the rats jump overboard but when the officers abandon it mid-voyage. If that’s the case, HMRC appears to be sinking because a number of its most Senior Members have departed in recent months.  That well known magazine Private Eye […]

The Value of the Independent Internal Review – COS Systems v HMRC

Back in the early 2000’s, HMRC was becoming concerned at the number of appeal cases being listed for hearing by what was then the General and Special Commissioners and, after consideration and consultation, in 2009 they introduced a new system where appeals would be heard by the First-tier and Upper tribunals. In the review process […]

Do you have an interest in or connection to an offshore asset or entity?

If you have an interest in or a connection to an offshore asset or entity (“offshore arrangements”) you are likely to attract the unwanted attention of HM Revenue and Customs (“HMRC”) even though they may have been set up for perfectly legitimate reasons and are tax compliant.  The increasing media exposé of offshore financial centres […]

More Data – HMRC’s key to the Hidden Economy

The difficulty with the Hidden Economy – like the so-called ‘Tax Gap’ – is that no-one can actually say how big it is. That’s why it’s referred to as being Hidden. It is clear that HMRC believes that the solution to the hidden economy is to reveal as much of it as possible – and […]

Big Brother Requires You to Confess – and Correct Your Sins

One sometimes wonders whether the Government has taken its inspiration from George Orwell’s 1984 or whether it is a symptom of HMRC’s decreasing staff resources but, increasingly, we see legislation that places the burden upon taxpayers to confess all their sins to HMRC and then take steps to put things right. Two examples of this […]

The Final Nails in the Coffin of Tax Avoidance?

As further proof – if proof were needed – of the Government’s determination to wipe out tax avoidance altogether, in the Autumn Statement the Chancellor has announced yet more sanctions and deterrents. The proposed sanctions have already been largely set out in ‘Consultation documents’ – although the results of the alleged ‘consultations’ have not yet […]

Mr Tooth Bites Back

The Taxes legislation has long reserved the heaviest penalties for the taxpayer with the most heinous behaviour – so that there is a heavier penalty for the taxpayer who deliberately evades his tax than there would be if he got it wrong through a careless mistake, with the heaviest reserved for those who deliberately got […]

Elephant Guns and Mice – A Money Laundering Penalty on an Accountant

A recent First-tier Tribunal decision where the Tribunal imposed a penalty of over £3,000 on an accountancy firm that failed to maintain proper money laundering checks sends a salutary warning to all accountants and bookkeepers – no matter how small their practice. The firm in question, N Bevan Ltd (‘NBL’) has one professional, Mr Neil […]

HMRC gets tough(er) again: The Worldwide Disclosure facility

When does it start and who can use it? On the 5th of September 2016, HMRC finally published details of its new disclosure facility; the Worldwide Disclosure facility (WDF), which will run from the 5 September 2016 to 30 September 2018. HMRC has announced that this is a final opportunity for taxpayers who wish to […]

Coming soon – the next Offshore Disclosure Facility

In the past few days HMRC have begun to provide some limited details of the next – and long promised – offshore disclosure facility. Referred to as the Worldwide Disclosure Facility or WDF, the disclosure facility will be open to anyone who is disclosing a UK tax liability that relates wholly or in part to […]

“Ingenious” partnerships – Two out of three might not be bad – but it isn’t good

The First-tier Tribunal (FTT) has released its long awaited decision in the tax-planning schemes of Ingenious Games (IG), Ingenious Film Partners 2 (IFP2) and Inside Track Productions (ITP) litigation and has agreed that two of the three partnerships were trading – but the impact for investors is severe. The Court hearing took place over a […]

Panama Papers – When will the Taxman come?

This has been such a year for astonishing events – what with Brexit, Prime Ministers and party leaders resigning left, right and centre, along with terrorist atrocities, attempted coups and disasters on a scale that previously might not be imagined – that everyday matters like tax evasion and avoidance can seem quite mundane. All the […]

The Perils of the Personal Service Company

There are a great many skilled and unskilled workers in the UK who have recognised the benefits of trading via a limited company, not least of which is the tax advantage of taking remuneration in the form of dividends rather than by way of a salary. Unfortunately, in forming a company, many taxpayers may be […]

Pine v HMRC – The costs of Justice prevent Justice

Anyone familiar with the UK Courts system will be aware that there may be instances where the costs of taking a case to Court may deter an appellant from pursuing a case to get the decision that they believe is due. It can become a simple commercial decision to accept what might be the wrong […]

Tax Avoidance – Gold loses its Glitter

Tax practitioners with long memories may remember a time – long, long ago – when the promoters of tax avoidance came up with all kinds of wild schemes to circumvent the more annoying features of PAYE – namely the need to pay tax and NI, and particularly employer’s NI – by paying their employees in […]

PAC reports HMRC must try harder, again!

The Public Accounts Committee (PAC) in its report of 15 April 2016 is critical of HMRC’s approach to addressing tax evasion which includes concerns over its criminal prosecution policy. To be fair to HMRC, it is not possible to undertake criminal prosecutions into every case involving tax evasion. Criminal investigations are resource intensive and more […]

The Panama Papers Database – Guilty until proven Innocent

On 9th May 2016 the International Consortium of Investigative Journalists (‘ICIJ’) undertook the next step in their release of the information obtained from the Panamanian law firm, Mossack Fonseca – the so-called Panama Papers – when they allowed public access to a searchable database that summarises the leaked information. The ICIJ website enables anyone to […]

Nothing New?

The International Consortium of Investigative Journalists (ICIJ) announcement that it has received more than 11.5 Million financial and legal records relating to Mossack Fonseca and its exposé of prominent politicians and their families has once again brought tax evasion and tax avoidance to the fore of the public conscience, that’s if it ever went away. […]

Does Panama = Bad? Maybe not…

The furore regarding the “Panama Papers” – the 11.5 million documents leaked from the Panamanian law firm of Mossack Fonseca – would seem to suggest that everyone involved in a Panamanian company must be a serious villain on a par with Ernst Stavro Blofeld of James Bond fame. Indeed, the introduction on the website set […]

Supreme Court Settles Eclipse 35 Dispute

The sun has set on litigation that started in 2012 between HMRC and Eclipse Film Partners No 35 LLP (“Eclipse 35”). The Supreme Court comprising of five Lords has refused Eclipse 35 permission to appeal. The permission to appeal was refused in under an hour demonstrating the definitive position of the law as summarised by […]

Supreme Court to Settle the Eclipse 35 Dispute

Following a Court of Appeal ruling in February 2015 which found in favour of HMRC that Eclipse Film Partners No 35 LLP (“Eclipse 35”) did not carry on a trade, the Supreme Court will this week hear the appeal by Eclipse 35 against the Court of Appeal’s decision. This is the latest and, very probably, […]

Failure to pay National Minimum Wage – director disqualified

In a case that may cause shockwaves across the corporate sector, Manchester nursery owner, Joanne Ward, has recently been disqualified from being a director of a limited company for 6 years for failing to pay the National Minimum Wage. Even though the company of which she had been director had gone into liquidation, the Insolvency […]

Rangers EBT case – Not dead yet

The long-running saga that is the Tax Case involving Rangers FC’s use of an Employee Benefit Trust has been given yet another lease of life when, this week, the liquidator BDO who represents Rangers was granted permission to appeal the decision given by the Court of Session to the Supreme Court. The case has already […]

Voluntary tax return not subject to enquiry and penalties- HMRC own goal

The First Tier Tribunal (FTT) has found that HMRC cannot enforce collection of tax included in a notice of closure or penalties for careless inaccuracy where a return is filed without HMRC having first issued a valid notice requiring a return. The lynch-pin point around which the case of Alexander Revell v HMRC [2016] UKFTT […]

Final Call for the Settlement Opportunities

This is a final reminder that the Film Scheme Settlement Opportunity and the settlement opportunity for the various tax avoidance schemes involving ‘Sideways loss relief’ – whether for individuals, partnerships or corporate entities, close at noon on Thursday 11th February 2016. For further information, see our earlier blogs at https://blogs.mazars.com/letstalktax/2016/01/15/tax-avoidance-film-schemes-last-chance-for-an-exit/ and https://blogs.mazars.com/letstalktax/?s=Sideways+loss If you would […]

HMRC turns the Spotlight onto CFD Schemes

HMRC has published the latest in a series of Spotlights which aim to warn users of tax avoidance schemes currently under HMRC’s radar. The catchy titled “Spotlight 28: Employee Bonus Schemes – Growth Securities Ownership Plan and other avoidance schemes based on contracts for difference”, concerns tax avoidance schemes using a contracts for difference (CFD) […]

Tax Scheme Investors – Rebus goes into administration…who do you turn to now?

The claims management company Rebus has gone into administration, leaving thousands of its clients’ claims up in the air. Rebus specialised in pursuing claims against companies that mis-sold complex investments, which were later deemed to be tax avoidance schemes (BBC News). This is a very unsatisfactory situation for those investors who are clients of Rebus […]

High Noon – Time to leave the Film Scheme

Participants in Tax Avoidance Film Schemes are reminded that they have until 12 noon on Thursday 11th February to register their interest to reach a settlement with HMRC. Those who fail to do so are likely to have to pay more to settle at a later date. The settlement opportunity was one of those announced […]

Doors Closing on the Sideways Loss Relief Settlement Opportunity

Individuals, partnerships and companies who sought to avoid – or substantially delay – the payment of tax through tax planning schemes via Sideways Loss Relief have until midday on Thursday 11th February to register their interest to reach a settlement with HMRC. Those who fail to do so are likely to have to pay more […]

In Tax, It Takes Two to Agree

In a recent Tax Case, the Tribunal took the unusual step of making some strong criticisms in respect of how some appeals are claimed to be ‘settled’ by HMRC. When a taxpayer has an open appeal with HMRC, there are typically three ways in which the appeal can be settled: 1. The appeal may be […]

Special relief is a great relief to Mr Scott

A taxpayer who had got seriously behind with his tax affairs has obtained last-ditch relief because the Tribunal decided it would have been unreasonable and excessive for HMRC to refuse to reduce assessments under the special relief rules. The story began when Mr Scott failed to file his 2006/07 and 2007/08 self-assessment tax returns, so on […]

Prosecution shows HMRC are taking IHT fraud very seriously

Time was when IHT was regarded as a “voluntary tax” but not anymore. HMRC’s increasingly tough line on evasion of all taxes has been underlined by the jail sentence of two years and eight months on a woman, a Mrs. Bunn, for telling HMRC that her late mother’s estate was worth £285,000 when in fact […]

Happy Birthday! Now report your employer!

The recent publication of a new list of employers who are being ‘Named and Shamed’ for failing to pay the National Minimum Wage does much to instil terror in the hearts of employers everywhere – but, if anything, it also elicits sympathy for some of those included on it. The reasons for that sympathy are […]

Halloween Scare Schemes – EMI options: What could possibly go wrong? Common misunderstandings and mistakes

Although the legislation governing Enterprise Management Incentives (EMI) options is fairly flexible, and not particularly restrictive, there are some areas where advisers and companies can get themselves into difficulties. This could mean that the EMI options will not qualify, or will only partially qualify, for EMI tax reliefs. The most common mistakes and misunderstandings relate […]

HMRC updates list of tax avoidance schemes subject to the Accelerated Payment process

HM Revenue & Customs (HMRC) have updated their lengthy list of avoidance schemes whose users may be issued with an Accelerated Payments Notice (APN) under legislation introduced in the Finance Act 2014 on 17 July 2014. The list contains 1,200 schemes and is a working list of Disclosable Tax Schemes (DOTAS) whose users may be […]

European Commission kindles first flames in battle with Amazon

State aid: Commission investigates transfer pricing arrangements on corporate taxation of Amazon in Luxembourg Today, the European Commission announced that it has opened an in-depth investigation to examine whether the decision by Luxembourg’s tax authorities with regard to the corporate income tax to be paid by Amazon in Luxembourg comply with the EU rules on […]

HMRC commence the Accelerated Payment process

HM Revenue & Customs (HMRC) have started the process of issuing Accelerated Payment Notices (APN) to users of DOTAS schemes following legislation introduced in the Finance Act 2014 on 17 July 2014.  HMRC have previously published a lengthy list of Disclosable Tax Avoidance (“DOTAS”)  schemes which they will be issuing APN’s to. HMRC have begun […]

Doomed to be misquoted?

Occasionally a Tax Case is published and, even at its first reading, the heart of the experienced tax investigations practitioner sinks as he realises that the case is likely to be misquoted by HMRC as supporting such-and-such a principle. For instance, the recent case of Daniel Pittack v HMRC ([2014] UKFTT 670) which was heard […]