Disclosure of cross-border arrangements
HMRC has recently been consulting on how the UK will implement new EU disclosure rules contained in the latest Directive on Administrative Cooperation (DAC6). ... - Continue reading
Category: Disclosure of Tax Avoidance Schemes (DOTAS)
UK – HMRC WINS TWO TAX AVOIDANCE CASES OVER USE OF OFFSHORE TRUSTS
The HMRC has successfully argued two cases in the First-tier Tribunal involving the use of offshore trusts to avoid tax and National Insurance Contributions (NICs). The case was brought against Hyrax Resourcing Limited and Curzon Capital Limited. The Tribunal decided in both cases that the disguised remuneration arrangements being promoted… – Continue reading
SMEs are paying more corporation tax than bigger businesses
According to figures released earlier this year, SMEs are in fact paying more corporation tax than larger more complex organisations. Specifically, the rate paid by SMEs in 2016 was 21.7%, while it was 20% for businesses with a turnover of £1billion. The research was conducted by accountancy firm Moore Stephens,… – Continue reading
A stark warning for participants of the ‘Alchemy’ tax scheme
On 11 September 2017, His Honour Judge Colin Bishopp handed down his judgement in the case of The Commissioners for Her Majesty’s Revenue and Customs –v- (1) Root2tax Limited (2) Root3tax Limited (in liquidation) [2017] UKFTT 0696 (TC). The Root2 judgement concerned HMRC’s application to the First Tier Tax Tribunal… – Continue reading
Crest Nicholson loses tax avoidance case
A tax tribunal has ruled against a stamp duty land tax (SDLT) avoidance scheme used by Crest Nicholson, one of the UK’s largest house builders, meaning it will have to pay the £1.3m it owes. HM Revenue & Customs (HMRC) challenged the artificial and complex arrangements made by the FTSE… – Continue reading
Hong Kong, a hub for corporate offshore schemes, must ensure disclosure rules are truly effective
Jane Moir says the authorities’ plan to require companies to reveal their controlling owners, in the wake of the Panama Papers scandal, does not go far enough Last year’s Panama Papers revelations put Hong Kong in the crosshairs of global anti-money laundering bodies. The dump of 11.5 million documents from… – Continue reading
HMRC withdraws 3,000 demands for upfront payment from those accused of tax avoidance
HMRC has withdrawn around 3,000 of its accelerated payment notices APNs – which give recipients 90 days to settle up – were introduced in July 2014 The Revenue has come underfire for issuing notices with ‘too little consideration’ HM Revenue & Customs has withdrawn around 3,000 of its controversial notices… – Continue reading
HMRC withdraws 3,000 demands for upfront payment from those accused of tax avoidance
HMRC has withdrawn around 3,000 of its accelerated payment notices APNs – which give recipients 90 days to settle up – were introduced in July 2014 The Revenue has come underfire for issuing notices with ‘too little consideration’ HM Revenue & Customs has withdrawn around 3,000 of its controversial notices… – Continue reading
UK Consults On Anti-VAT Avoidance Measures
The UK Government has launched a consultation on plans to make the disclosure of value-added tax avoidance schemes (VADR) system more closely resemble the Disclosure of Tax Avoidance Schemes (DOTAS) regime. According to the consultation, “VADR should be more closely aligned with DOTAS to provide early information on new avoidance… – Continue reading
Clampdown on tax avoidance
“We are clear. We will not stand for a minority of taxpayers continuing to seek out unacceptable ways to reduce the amount of tax they pay, and we will ensure HMRC has the tools to robustly tackle such activity.” So said David Gauke, Exchequer Secretary to the Treasury. A clampdown… – Continue reading
HMRC issues warning over contractor loan tax avoidance schemes
As part of what it describes as a ‘relentless’ effort to crack down on tax avoidance, HMRC has put out two publications highlighting problems with contractor loan schemes and misleading claims from scheme promoters, in a bid to deter taxpayers from any involvement In its Spotlight 29 document, HMRC says… – Continue reading
HMRC to repay tax to thousands of banking and IT contractors
Banking and IT contractors forced to stump up tens of thousands of pounds to settle contested tax debts last year are now in line to be repaid, after the UK tax authority accepted it should not have issued payment demands. HM Revenue & Customs has withdrawn so-called accelerated payment notices… – Continue reading
HMRC withdraws APNs from 2,000 Montpelier contractors
The taxman has been forced to apologise after admitting that Accelerated Payment Notices he sent to 2,000 Montpelier tax scheme contractors should never have been issued. In a letter notifying the affected contractors, HM Revenue & Customs reminds that three conditions must be present for it to be able to… – Continue reading
HMRC Welcomes Fall In Banking Sector Tax Schemes
The number of legacy bank tax avoidance schemes under investigation by UK tax authority HM Revenue and Customs (HMRC) has fallen since the strengthening of Code of Practice on Taxation for Banks, a new departmental report has shown. The Code of Practice on Taxation for Banks was introduced in 2009… – Continue reading
HMRC hails success of tax avoidance clampdown on UK banks
HMRC said the amount of money in tax avoidance schemes has fallen from £3.2bn in 2013 to £1bn All but two UK-registered banks have signed up to a Government scheme encouraging lenders to avoid using tax avoidance schemes. Some 303 lenders, including banks and building societies, have now signed up… – Continue reading
No going back – the perils and pitfalls of the UK’s APN and PPN
What is abundantly clear to anyone who has a passing interest in the manner in which tax disputes are dealt with in the UK is that the legislation in Finance Act 2014, concerning accelerated and partner payment notices (the APN legislation), marks a significant shift in the rules of engagement… – Continue reading
Top UK cricketers caught up in film scheme losses
Several former England cricket captains have been caught up investing in disputed film schemes that have also seen many high-profile footballers lose millions. The Sunday Times reported over the weekend that it had seen documents showing that Michael Vaughan, Andrew Flintoff and Marcus Trescothick were among the cricketers who had… – Continue reading
UK taxman cracks down on property tax avoidance schemes
The UK taxman has collected £301.8 million in unpaid property tax due to what is described as an aggressive clampdown on stamp duty avoidance. HMRC’s new Counter Avoidance Directorate collected the amount in the last year as part of a policy to crackdown on Stamp Duty and Land Tax (SDLT)… – Continue reading
HMRC asked tax avoider to sign pledge not to engage in practice again
Department says letter was sent as part of series of measures to discourage wider issue of tax avoidance and was not a legally binding document HMRC wrote to a tax avoider asking them to sign a pledge never to do it again, it has emerged. The letter was intended to… – Continue reading
Does corporate tax planning have a future?
FOCUS: Significant changes to the international tax system planned for the next five years, coupled with a major shift in attitudes towards tax avoidance, has all but killed off the traditional tax scheme. So what does the future hold for businesses seeking to engage in tax planning? To celebrate Out-Law’s… – Continue reading
Accelerated Payment Notices FAQ
Celebrities and sportsmen are among the thousands of taxpayers receiving accelerated payment notices from HM Revenue & Customs (HMRC) for taking part in alleged tax avoidance schemes. Accelerated payment notices (APN) are a new tool for HMRC to wield against wealthy taxpayers – but contractors, landlords and many less well-off… – Continue reading
Insider blows the whistle on multi-million pound tax avoidance ‘factory’
Failed tax avoidance business Welbeck hired young actors to push schemes onto City big earners, and reaped millions in commissions that fuelled lifestyles of fast cars and exotic holidays, according to a whistleblower who worked at the firm. Welbeck Solutions sold pensions and financial products, but it specialised in tax… – Continue reading
Welbeck Solutions: Whistleblower exposes secretive city firm at the heart of vast tax avoidance operation
Company used actresses including former Alan Partridge star to bombard financial sector workers with cold calls The grey Basinghall Street office building, in the heart of London’s City financial district, gives few clues about the frenzy of activity that was going on inside. But for years, this was the home… – Continue reading
FATCA Helps IRS Net £5 Billion In Lost Tax
The US Foreign Account Tax Compliance Act (FATCA) has helped grab £5.17 billion in lost tax held in secret offshore bank accounts. The Internal Revenue Service (IRS) has revealed the figures in a FATCA update. The IRS says the controversial law has made identifying offshore cash and investments that taxpayers… – Continue reading
HMRC grows Affluent Unit in tax avoidance crackdown
A sharper focus on offshore banking activity and tax avoidance has seen HM Revenue & Customs grow its Affluent Unit by more than 50% in the past two years. In 2013 the unit had 213 people in its function whereas now headcount sits at 327, an increase of 54%. It… – Continue reading
Britain’s £34bn uncollected ‘tax gap’ is no worse than other countries’, says HMRC tax head
Edward Troup says the tax authority is doing its job well The amount of tax going uncollected in the Britain is no worse than in other countries around the world, a senior official at the tax authority has said. Edward Troup, HMRC’s tax assurance commissioner, told the House of Commons… – Continue reading
HMRC Task Force Gears Up To Take On Tax Avoidance
HM Revenue & Customs (HMRC) has launched a new crackdown on tax avoidance with 10 tips on how to stay on the right side of the law. The warning follows recent revelations of 1,500 investors, including celebrities and sports stars, who are being pursued for £200 million for staking cash… – Continue reading
APNs Shouldn’t Force UK Taxpayers Into Bankruptcy: RPC
Law firm RPC has called on the UK tax authority, HM Revenue and Customs, to confirm that it will not force individuals into bankruptcy through the use of Accelerated Payment Notices. HMRC began sending APNs to UK users of certain tax avoidance schemes in August 2014. The notices give recipients… – Continue reading
UK tax agency must report full scale of tax avoidance-lawmakers
LONDON, Nov 4 (Reuters) – British authorities must start reporting the full scale of aggressive tax avoidance and prosecute more people for evading tax by moving money offshore, lawmakers said on Wednesday. The Public Accounts Committee of Britain’s parliament said the government’s tax agency, HM Revenue and Customs (HMRC), should… – Continue reading
U.K. Offshore Tax Enforcement `Woefully Inadequate,’ Panel Says
The number of U.K. prosecutions for offshore tax evasion is “woefully inadequate” and the tax agency, Her Majesty’s Revenue & Customs, is failing to provide lawmakers with the information they need to close loopholes used for avoidance, the House of Commons Public Accounts Committee said. The agency should also publish… – Continue reading
Tony Wickenden: The fine line between tax avoidance and evasion
Government action against tax avoidance has made the headlines on numerous occasions over the past few years, with significant developments in litigation, legislation and early tax collection, via a combination of follower notices and accelerated payment notices. Add to this the expansion of the disclosure of tax avoidance schemes, hallmarks… – Continue reading
Six times as much tax lost to crime as to avoidance
Nearly six times as much tax revenue is being lost as a result of illegal activity as through tax avoidance, official figures show. In fact, some £2.7billion was lost in 2013-14 to avoidance (down from both £2.8bn the previous year and an estimate of £3.1bn), compared with £15.7bn from illegal… – Continue reading
United Kingdom ‘tax gap’ falls to £34bn Steelers Lounge
The UK’s “tax gap” has fallen to £34 billion, according to HM Revenue & Customs (HMRC) following a series of crackdowns on evasion and avoidance by businesses and individuals. The numbers show the shortfall fell to 6.4% from 6.8% of tax due for 2013/14, remaining static in cash terms at… – Continue reading
How a company worth billions pays pennies on a million for tax
The company that is not a taxi company, which has drivers that are not taxi drivers, who carry people around that are not clients, Uber, is not only killing the taxi business, it is also avoiding paying taxes. The company uses a trick known as “the double-Dutch.” It is perfectly… – Continue reading
Mandatory disclosure rules: OECD releases final paper on BEPS 12
What has happened? On 5 October 2015 the OECD issued its final paper on BEPS Action 12 Mandatory Disclosure Rules, Action 12 – 2015 Final Report (Paper). In this Alert we highlight the main issues and recommendations for taxation reform raised in the Paper. The Australian Treasurer’s BEPS Press Release… – Continue reading
Margaret Hodge calls for overhaul of UK tax laws
Former chair of the UK public accounts committee Margaret Hodge, who has repeatedly attacked the use of offshore tax avoidance schemes, has called for an overhaul of the British tax system. Speaking during an annual Professional Fee Protection (PFP) tax investigations conference, Hodge said the current tax regime in the… – Continue reading
CLINTON LIBRARY FUNDED BY OFFSHORE TAX HAVEN
Hillary Clinton is repeating the Democrat trope about “offshore tax havens” that immorally divert profits from workers and the taxman. Closing these is a central plank of her promised agenda as President, she explains in an op-ed laying out her economic agenda. Setting aside the economic merits of her plan,… – Continue reading
Is a Canada Revenue Agency landlord avoiding taxes via offshore havens?
The Canada Revenue Agency (CRA) rents office space from a Vancouver-based property developer – a company that exploits offshore tax havens in Liechtenstein, the British Virgin Islands and Channel Islands. Larco Investments Ltd. owns three buildings in Montreal, Calgary and Edmonton where they rent office space to the CRA. Larco… – Continue reading
Tony Wickenden: Nowhere left to hide for serial tax avoiders
x At present, says the Government, serial avoiders find themselves in no worse a position than someone who has used only one failed avoidance scheme and has decided not to do it again. They face no additional deterrent to stop them persistently seeking to circumvent the will of Parliament. With… – Continue reading
HMRC prevails in trial against £200m double taxation loophole
HM Revenue and Customs (HMRC) has succeeded against a £200 million tax avoidance scheme which exploited the UK’s double taxation agreement with the Isle of Man, whereby people are not taxed on the same income in both the UK and the Isle of Man. Those who took advantage of the… – Continue reading
Companies ‘are scrambling to boost tax transparency amid global crackdown’
Companies around the world are scrambling to overhaul how they communicate with the public when it comes to how much tax they pay, according to professional services firm KPMG. While the Senate is currently investigating multinational firms such as Apple and Google over potential tax avoidance, other countries are also… – Continue reading
Report: AstraZeneca funnels billions into Dutch tax-avoidance scheme
AstraZeneca ($AZN) is not the first company to employ questionable tax-planning strategies, and it certainly won’t be the last. But the U.K.-based drugmaker is the latest poster child for tax avoidance. As The Guardian reports, AstraZeneca funneled billions of dollars into the Netherlands to get out of paying corporate taxes… – Continue reading
POTAs and DOTAs shake up
HMRC has released new Guidance on the disclosure of tax avoidance schemes (DOTAS) and promoters of tax avoidance schemes (POTAS), regimes. The new, revised, Guidance explains changes to the regimes since 2014. In relation to the issue of Conduct Notices, whereas previously the Guidance confirmed that HMRC would meet with… – Continue reading
‘Frustrating’ delay on single tax enquiry issue closure, says expert
The UK government is unlikely to be able to legislate to speed up the referral of a single issue within a wider tax enquiry to the tax tribunal before 2017 despite the urgent need for such a procedure, an expert has said.30 Sep 2015 Respondents to a recent consultation on… – Continue reading
HMRC Nets GBP1bn From Anti-Avoidance Work
HM Revenue and Customs (HMRC) has used its Accelerated Payments powers to collect GBP1bn (USD710m) from users of tax avoidance schemes. HMRC began sending Accelerated Payment Notices (APNs) to UK users of certain tax avoidance schemes in August 2014. The notices give recipients 90 days to pay the tax in… – Continue reading
HMRC reports ‘record’ £1bn tax take from use of accelerated payment notices
The UK government’s use of ‘accelerated payment notices’ (APNs) to demand up-front payment of disputed tax has enabled it to collect £1 billion in payments from users of tax avoidance schemes, it has announced.14 Sep 2015 HM Revenue and Customs (HMRC) has issued over 25,000 APNs since August 2014 to… – Continue reading
Funding for businesses facing APNs
A funding line has been launched to help business taxpayers facing payment deadlines arising from Accelerated Payment Notices (APNs) APNs, introduced in 2014, enable HMRC to request full upfront payment of disputed tax within 90 days. They are issued to individuals and companies suspected of partaking in aggressive avoidance schemes…. – Continue reading
Last minute funding to help SMEs pay tax bills
Commercial finance provider LDF has launched a funding line to help taxpayers facing payment deadlines arising from accelerated payment notices issued by HMRC. Accelerated payment notices, otherwise known as APNs, were first introduced in 2014. Designed to change the economics of avoidance, the notice enables HMRC to request full upfront… – Continue reading
Bequeathing DOTAS
HMRC has published draft regulations which will extend the application of the disclosure of tax avoidance schemes (DOTAS) regime to inheritance tax (IHT) avoidance structures. The draft regulations set out the circumstances in which arrangements will be required to be registered under the DOTAS regime. Registration will be required where… – Continue reading
Draft regulations could require disclosure of all but the most basic IHT planning, warns law firm Boodle Hatfield
Draft regulations have been published that could see individuals and their tax advisers having to disclose participation in all but the most basic of inheritance tax (IHT) planning. The draft regulations could, says law firm Boodle Hatfield, require even straightforward arrangements to be disclosed, swamping HMRC with information that they… – Continue reading
