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HMRC win UK residence cases in Supreme Court

HMRC have won in the Supreme Court the UK residence cases concerning Davies and Gaines-Cooper based on the interpretation of UK Residence booklet IR20.  The judgment is HERE.

Anyone surprised by this outcome?

David

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20th Oct 2011 10:19

Not really surprized.

This is only my personal opinion, but Mr. Gaines-Cooper may have been operating within the letter of the law as IR20 was written at the time, but he certainly wasn't operating within the spirit of the law.

However, this comes down to not having a statutory residence test which is either 'Yes' (Resident) or 'No' (Non-Resident). This is promised for 2012 and having looked at the proposals it seems harsh, but fair. At least it will provide certainty which is what Mr. Gaines-Cooper was looking for, but didn't find.

I sympathize with his financial position, having to potentially pay 30 million pounds in tax, interest and penalties is a hefty sum, even for one of Mr. Gaines-Coopers means, but that is the way our tax and appeal systems work, so he needs to cough up.

One thing which is not clear to me is what are the consequences of him NOT paying up. Sure, they could seize his property and assets in the UK, but presumably the vast majority of his assets are outside of the UK.

I'll be watching Mr. Gaines-Coopers reaction to all of this with interest... and penalties :O)

EDIT: - I spoke too soon, it appears Mr. Gaines-Cooper is considering an appeal to the European Court of Justice.

http://www.telegraph.co.uk/finance/personalfinance/consumertips/tax/8837341/Robert-Gaines-Cooper-tax-ruling-puts-hundreds-of-expats-at-risk.html

 

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