Tax avoidance question
Discussion
When you use a legal and accepted tax avoidance method, what happens if HMRC decides to close that avenue? Can they back date taxes, and does this normally happen?
For example, the Artic Systems case. HMRC are talking about getting new legislation passed that will mean that the Artic Systems victory is essentially null and void, and that using the husband/wife tax allowance isn't possible any more. In this situation could HMRC back date the taxes?
What I'm getting at is: If it's legal, do you make hay while the sun shines?
For example, the Artic Systems case. HMRC are talking about getting new legislation passed that will mean that the Artic Systems victory is essentially null and void, and that using the husband/wife tax allowance isn't possible any more. In this situation could HMRC back date the taxes?
What I'm getting at is: If it's legal, do you make hay while the sun shines?
There are lots of UK laws and practices that could and should be challenged in the European Court of Human Rights.
Next year, for instance, taxpayers filing returns on paper will have three months less in which to submit the returns compared to those who will be filing on-line.
That certainly smacks of discrimination to me.
Next year, for instance, taxpayers filing returns on paper will have three months less in which to submit the returns compared to those who will be filing on-line.
That certainly smacks of discrimination to me.
Eric Mc said:
Next year, for instance, taxpayers filing returns on paper will have three months less in which to submit the returns compared to those who will be filing on-line. That certainly smacks of discrimination to me.
According my accoutnant today, the HMRC website is not working for online tax payments at the moment - system no doubt clogged with last minute returns.I still have four to do.
I fully expect the HMRC computer to fall over quite a few times over the next few days - it always does at this time of year.
This year the number trying to use the on-line filing facility woill be at its highest level ever - so mutiple crashes are to be expected.
It will be interesting to see what their atitude will be to those who picked up late filing penalties just because their system couldn't cope.
I fully expect the HMRC computer to fall over quite a few times over the next few days - it always does at this time of year.
This year the number trying to use the on-line filing facility woill be at its highest level ever - so mutiple crashes are to be expected.
It will be interesting to see what their atitude will be to those who picked up late filing penalties just because their system couldn't cope.
Make hay.
This is a very current topic. HMRC, on a regular basis, once they lose a case - usually in the High Court - opposed to the House of Lords - seek to change the law.
This is known as 'blocking legislation'. HMRC lost the DMG case in the House of Lords. However, more importantly they also lost at the High Court and decided to introduce blocking legislation to be effective from the date of the announcement of the proposed legislation, despite it not being enacted some several weeks later.
The use of retrospective blocking legislation has been declared illegal by the European Court of Justice. Further, another case says that you need at least a 6 month 'adjustment' period in order for the blocking legislation to be effective.
Anyway to get to the point, it cannot be retrospective in the sense that you ask and you should not be asked to pay penalties for previous assessments. Moreso, if those are now closed assessments. If you have any current open enquiries, it is possible that HMRC will seek to use this stick to beat you with. However, make hay.
This is a very current topic. HMRC, on a regular basis, once they lose a case - usually in the High Court - opposed to the House of Lords - seek to change the law.
This is known as 'blocking legislation'. HMRC lost the DMG case in the House of Lords. However, more importantly they also lost at the High Court and decided to introduce blocking legislation to be effective from the date of the announcement of the proposed legislation, despite it not being enacted some several weeks later.
The use of retrospective blocking legislation has been declared illegal by the European Court of Justice. Further, another case says that you need at least a 6 month 'adjustment' period in order for the blocking legislation to be effective.
Anyway to get to the point, it cannot be retrospective in the sense that you ask and you should not be asked to pay penalties for previous assessments. Moreso, if those are now closed assessments. If you have any current open enquiries, it is possible that HMRC will seek to use this stick to beat you with. However, make hay.
Edited by thebullettrain on Thursday 31st January 23:54
edb49 said:
When you use a legal and accepted tax avoidance method, what happens if HMRC decides to close that avenue? Can they back date taxes, and does this normally happen?
For example, the Artic Systems case. HMRC are talking about getting new legislation passed that will mean that the Artic Systems victory is essentially null and void, and that using the husband/wife tax allowance isn't possible any more. In this situation could HMRC back date the taxes?
What I'm getting at is: If it's legal, do you make hay while the sun shines?
I think I've got to disagree with Eric here. In the case or Arctic Systems which the OP used as the example, the new law that is coming into force on Income Shifiting will not and cannot be retrospective.For example, the Artic Systems case. HMRC are talking about getting new legislation passed that will mean that the Artic Systems victory is essentially null and void, and that using the husband/wife tax allowance isn't possible any more. In this situation could HMRC back date the taxes?
What I'm getting at is: If it's legal, do you make hay while the sun shines?
The court essentially found that Arctic Systems was acting legally under the tax laws in force at that time, therefore by application of case law so would other companies using the same methods. HMRC appealed to the highest court in the land and they lost, i.e. the legal interpretation of that tax law suited the taxpayer and not the HMRC. Result being that HMRC have to 'apply' for legislation that is clearer or closes that tax economy opportunity. No retrospective application of that new law would be alllowed.
The idea of "retrospective laws" smacks to me of the sort of dictatorship the former Soviet Union would have spouted - and be roundly condemned by the west. In reality (as far as I'm aware) even such dictatorships didn't introduce retrospective laws. I, for one, would gladly take the Government to the European Court if I felt there was a reasonable chance of victory. However, I doubt I'd win because it relates to Tax and "turkeys don't vote for Christmas" - it's our Tax that keeps the EU monster alive!
Uonlyhave2seats said:
Lets not forget my most hated piece of retrospective legislation regarding pensions. Those of us that diligently saved our money over many years in a pension fund to retire at 50 suddenly found we could no longer get the money till 55. Outrageous.
yes, I was peeeed off with that lovely cherry. Private pension, and they tell me when I can claim on it. What the f has it to do with the govt when we cash in a private pension? I took it out to claim on at 50. Now its been changed to 55. why?Apologies for taking this slightly off topic. It was introduced because they wanted to stop those that had not saved enough money from becoming a burden on the state. All well and good but they have hurt those of us that did what we were told and saved for our future. We took out the policy with certain rules and had the carpet pulled from under us retrospectively. I tried writing to several MP's but they couldn't care, a few comfortable middle class voters are not going to swing an election.
Is this Tax Avoidance or Income Protection? 
Anyone see this a couple of years ago on the BBC?
http://news.bbc.co.uk/1/hi/business/4763984.stm
Anyone see this a couple of years ago on the BBC?
http://news.bbc.co.uk/1/hi/business/4763984.stm
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