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How helpful is this case?
My reading of this case is that it turned wholly on the facts relating to the funding of the share purchase.
It could work against the taxpayer in a different set of circumstances.
Overall it doesn't take the issue of the Settlements legistlation forward and just highlights the importance of putting the case before the First Tier Tribunal properly to get the facts decided clearly. It will be interesting to see if HMRC appeal this.
10% but only 10% issued
I think from a quick look at the decision that she only owned 10% of the B shares but the other 90% were not actually issued so in effect she reeceived 100% of and B dividend.
BG
HMRC motivation?
Just like Arctic Systems, it looks like HMRC has picked a case it was almost certain to lose in the end. Not that it's any comfort to the years of suffering inflicted upon the poor taxpayers at the time.
There must be many other cases HMRC could choose (assuming their husband & wife assetless IT contractor model was realistic) which would fall over much more easily.
Is is a vainglorious belief that if they win a difficult one, all the easy ones will fold like a house of cards, or are they just very bad a picking their fights?
HMRC V Patmore
A victory for common sense. It is time that HMRC stopped wasting public money pursuing husband and wife companies where, due to the underlying commercial realities of such companies, both the husband and wife take real financial risks, especially to their home.
The traditional type of set up represents a large proportion of the small business sector which underpins this country.
HMRC V Patmore
It is alarming if, in fact, "HMRC threw a lot of resources" at a first tier tribunal case.
That is not how they are supposed to be handled.
a close squeak i feel?
i have done split cap cos. for aeons, because it avoids all the dividend waiver twaddle thrust on us by sly lawyers/HMRC, BUT i always give the (opressed) partner VOTING shares, but sep. class, and usually 10-20%.
i think the absence of votes made this case tissue-thin, but lack of facts/reality never slowed down a good lawyer greased with large amounts of dough.
PS. Allegedly £20k of tax was at stake (a very small cruise missile) BUT how did they manage to fight this case without spending the gdp of Switzerland on legal fees thereby making it all pointless?
I'd love to fight loads of cases but no money to gamble.....The recent case of Novak Brajkovic of Novasoft Ltd highlighted that he started fighting all outraged at HMRC having temerity to go for a tax bill (using Qdos), but rapidly realized the costs were shooting towards the o/s tax bill, and therefore making the whole exercise futile, so he was forced to stand b4 the beak himself and plead his case.
it's NOT "simple" -Tom 7000 on Wed
he doesn't trust his wife "to have and to hold...until death us do part" - so come the massive d i v o r c e he didn't want to lose 50% of his hard-earned business to 'the old trout' - i suspect.
Forgetting of course that propelled by a lawyer, facts would not come in the way of a massive cheque based on 50% of his co. etc...
Nasty greasy lawyer laden with dough
Might have found the winning constructive trust argument which was nearly missed but for the Tribunal Chairman. Arrogant accountants who pontificate about law because they have read Janet and John's English law should remember that negligence begins where professional competence ends and knowing when the point has been reached is vital. Tax is the practice of law notwithstanding its greater affinity with numbers than most other branches of the law. All good accountant tax advisers I have known have been good lawyers too despite not having a formal qualification.
lawyers make good accountants
...this is why the whole tax system needs a massive over-haul, to ensure simplification.
Small company owner(s) should be able to arrange tax affairs without having to spend a fortune deciding the appropriate split of share ownership.
This situation is complete madness!!!
Tories' fairness on joint income
The Conservatives, pre-election, said they were for increased "fairness".
In this case, if they had gone for joint couple's tax returns (like US and IOM as I understand it), the s660a stuff would have been rendered pointless.
As things are, asymmetric earning couples pay widely differing overall tax from those couples earning the same amount.
H & W shareholders
It is time that HMRC stopped wasting public money pursuing husband and wife companies
Haven't the Tories just taken on a bloke with his wife owning most of the shares, think she lives abroad somewhere, doesn't pay a lot of tax ...
;-)
Liquidator chasing director
Hi
I wonder if anyone has experience of a liquidator pursuing the Director who allegedly has either paid themselves too much or indeed if his wife who was also a director & who worked part time generally carrying out admin duties.
This has been on-going for over 12 months & now the liquidator has confirmed legal action against my wife & I, they do not accept our answers/explanations which have been backed up from the company accountant.
Having taken professional/legal advice I am told that liquidators can take on cases which they believe have a chance of recovering cash for the creditors [that is of course after they recover their fees] my opinion is that they are 'bottom feeders'.
Is it a case of see them in court & let the DJ decide?