Health minister to repay £41,709 in expenses

Rebecca/Mark,

Given the media's lack of knowledge regarding the technical aspects of Hazel Blears' un-selfish "tax" payment, do you know of any way to check the position?

I agree with Mark that: a) either she knows the payment will sit on her Statement of account until it is repaid by HMRC (via Bristol?); or b) it is a payment on account in view of the voluntary disclosure/discovery enquiry of the capital gains tax arising for the tax year ended 5 April 2005 (I think I read the property was sold in August 2004).

If either a) or b), it doesn't seem such an un-selfish act and may breach the Ministerial code of conduct. I think we should know!

In respect of all these repayments of "misclaimed" expenses, I expect HMRC will be looking to obtain tax under the benefical loans legislation. Won't they?

I wonder what state the economy would be in if the people in charge were incapable of reading a rule book or filling in an expenses form or didn't know how to manage a household budget.

Oh wait!

:-(

Robert,

My colleague and I were just debating whether to file this year's P11Ds on that basis.

As for MPs being too busy, I can accept that fine details (like bath plugs) might be difficult, but I struggle to understand how you continue to claim for a mortgage you've paid off, or an office you sublet, surely those things you just know. As for acceptable, it beggars belief that anyone thinks it is right and justified to claim some of the things we've heard about, certainly I wonder how my MP eats £400 of food a week, he isn't renowned for charitable giving either, never mind why he thinks I should pay for it. (so far as I know he doesn't have a large family either, but as he doesn't live in the constituency I may be wrong there)

Can we all now assume that "Wholly, Exclusively & Necessarily" are now just guidelines?

On the same progamme I heard Margaret Beckett state that she was so busy that she had too little time to devote to the accuracy and acceptability of her expense claims.

Can we all now use this as a valid defence for a lack of due care and attention?

Must admit I am glad Mark has voiced the thoughts I had about Hazel Blears "repayment".

Did anyone see Menzies Campbell on Question Time last night, I only saw a snippet, but I did hear him respond to DD asking about the "Wholly necessarility and exclusivivity" of expenses as being "guidance". Personally I thought it S336 ITEPA and therefore statute.

Perhaps we need to educate our legislators as to the difference, and ensure that the many many lawyers who enter parliament understand and apply equity to their dealings.

is that it must have been in serious disrepair if it takes £42k to make it "HABITABLE"

They have been taking the Michael on these for years - why do they think they are entitled - they should remember they have been voted there by US!

How many Labour MPs have asked "What is the fair amount of tax to pay". It looks like they are quite keen on taxing everyone else but are keen to avoid tax themselves. In some cases it would appear that 'avoid' might be too generous.

It will sit on her account as an overpayment, and be refunded to her in due course because no one will understand why she sent it to them.

it is a charitable donation!

If she sold the property after 5 April 2008 she can do so by making clear that the gain was taxable. But she's talking about sending a cheque to the Inland Revenue (which almost implies that the gain arose before that body was subsumed into HMRC in 2005!)

Assuming then that the gain arose in an earlier tax year she has filed her tax return and cannot simply send a cheque for tax that the computer isn't expecting. Or rather, she can send a cheque but the system will then repay it or do they still hold funds 'in suspense' pending allocation? I think not.

For the computer to accept the monies as due they will need to be matched against a liability on Hazel's SA record. To create such a liability requires her to admit that her return was incorrectly completed, in which case interest will also be payable and possibly a penalty too. The return in question was filed under the old penalty regime so the unprompted(?) disclosure may justify a nil penalty, but nil interest too? I think not.

Or has Hazel been advised that she can safely offer to send a cheque to HMRC (Sorry, "Inland Revenue") safe in the knowledge that they will send it straight back?!

Mark Lee
Tax Advice Network