What a terrible waste of my time responding to your posts - please don't waste any more? Squirming is so unseemly - when you're wrong, you're wrong - move on.
So, don't bother then!
Unfortunately incorrect statements regarding important matters must be refuted, or some people will believe them. Sadly, that takes time.
What a lot of words to say very little. I'll avoid massive quotes and take - or shouldI say refute - your points in order.
1. It may be "cheaper" for HMRC to negotiate than to litigate, that was quite clearly NOT the point. The point is that if they are getting nowhere near the sums owed then they need to litigate - and we are given to understand that they are in many cases settling for pitiful percetanges of the sums that should be due.
it was also very clearly pointed out that they are prepared to jump through hoops to set precedent with laws such as IR35 but fail to do the same when there are far larger sums per unit at stake.
2. Primarolo. Enough said. However, the driving force behind IR35 was, once again, NOT the issue - it was the psychological aspect of their legal strategy that HMRC admitted to that was the point of that discussion.
3. "Demand extra powers". Yeeees... I clearly meant legislation.
All the stuff you wrote about precedent... not really relevant. Precedent can only take priority over primary legislation where that legislation is not clear, or may not be on point - to have precedent, there must be a case to set one - and for that to happen, there has to be a law to argue about in that case to begin with.
When HMRC don't like what they are seeing in how things operate, they demand extra powers enshrined in statutory law - such as IR35 when they didn't like the high dividends route. Of course, if the law is as poorly drafted as IR35 is/was then there can be ensuing case law, but that's not the point - the point is that prior to IR35 they had no way to go after the tax/NI that they now can with IR35 in place.
4. Principle v Principal.
You pasted a lot of stuff from a dictionary showing the correct definitions of those words - and thereby proved that you don't understand them. Your first post's title began: "The Principle Reason..." which was clearly intended to mean "the main reason" and that should therefore have been "The principal reason".
5. Nothing new about senior HMRC officials going to lunch with execs of companies?
Who said there was? Once again you chose to completely miss the point, which was very clear. I don't care if it's new, I didn't say it was new, what I did say is that it does not appear ever to have been investigated - and it should be IMO.
What a terrible waste of my time responding to your posts - please don't waste any more? Squirming is so unseemly - when you're wrong, you're wrong - move on.
Donald6000 - it would only be the top people (the ultimate decision-makers) who might be in a position to do something less than ethical.
Michael Feltham - as I said before, it is not logical that HMRC shy away from fighting cases in court over large sums of money due to time issues. We only need look at the extremes to which they went to set precedent in IR35 cases to see that they are more than willing to do this for small sums, so it makes no sense to duck out when large sums are at stake.
They have also admitted that their IR35 strategy is largely psychological - once they win one, they expect others to fall into line quickly. However, any such excuses should now be a thing of the past with the new tax measures announced in the Budget re profit-shifting.
All in all, the time taken is not a valid argument given the sums at stake - if it were so, you can bet that they'd have been demanding extra powers a long time ago.
And ummm... dare I mention, re the title of your post, that it would be the "principal" reason (not "principle").
I'd also add that the reports one hears of senior Treasury / HMRC people going to lunch with senior executives of companies to discuss their tax bill should have led to these questions being asked a long time ago.
At the time of the banking crisis there were many commentators says "They don't even apologise for what they've done".
Be careful what you wish for - the great and good realised that apology was actually a really good idea, so what we now see is many of them donning the hair shirt for a day as penance for a life of (what many of us see as) crime. and there are laws against much of what is being done.
So the modern world, if you're big enough, consists of:
1. Do what you like.
2. When it comes to light, apologise.
3. Be dragged in front of some enquiry committee, apologise again, evade questions.
4. Go home free.
5. Go to step 1.
These proceedings are a show, nothing more. This is what politicians now do when they intend to take no real action. HMRC will continue to target SMEs and make cosy deals with big business. However, HMRC's actions and the reasons we are given are not logical - even though they may have to wait years to get their money, penalties of HMRC's choosing plus interest should be enough to make most pay up sooner. £15bn is a relatively small figure, an Amazon / Starbucks or two would garner that, so it makes no sense, unless...
Has anyone ever looked into what HMRC people do after life as a taxman? We've seen MPs being appointed to directorships - even taking cash while in office. Perhaps we need to check for similar activities among their tax-collecting brethren? Where are Panorama when you need them?
Now let me be clear - I am accusing anyone of anything. I know of no evidence to suggest that any such thing is going on. But we have to wonder why they behave as they do and in doing so we need to look for possible motives. We all know the expression "if it walks like a duck...", so when something seems to walk with a wobbly gait, it may just be a normal person, not too steady on their pins or... it may be the other reason. It behoves us to check it out, as is currently done with MPs?
Employers NI view from the tax PAYER's perspective
NeilW wrote:
Employers NIC is not a tax on employment any more than any of the other taxes are.
Employers NIC is merely an increase in employee's cost of employment that is not indicated to the employee.
From a societal point of view it would be better if the employee had a wage of £50 and got paid £50, with the taxation dealt with by the employer entirely separately from the employee.
In other words it would be better if income tax and employee NICs were rolled into employer NICs and changed into a form of withholding tax along the lines of VAT.
Although likely it would be the other way around, since politicians could spin it as 'giving everybody a pay rise' - even though it doesn't change the net by one farthing.
I disagree. If you look at it from the point of the tax collector it looks as you describe, but when you look at it as a tax PAYER it's very different - perhaps not so much if you're a standard employee, but certainly if you are a taxpayer who would be self-employed (under sole trader / Sch D rules) if it were not for S44 etc.
A contractor who earns £100 a day and has found his work directly with the client company can happily operate under Sch D whereby the Treasury receives no ER NI whatsoever, from anyone.
The chap sitting next to him, doing the same work, is likely to be costing the client the same i.e. the client will pay the same amount to each of them. BUT... if the second guy is forced to use a Ltd Co, possibly because the work was found via an agency, then he now has to either:
(a) Deduct 14% ER NI from the £100 / day his Ltd Co receives or
(b) Use some non-PAYE form of remuneration, such as dividends or a hybrid approach.
Clearly the take-home pay is the key issue and it is equally clear that the first person takes home more than the second (if the second uses, or is forced to use, PAYE).
The only difference between the two of them is that one of them found the work via a call from an agent and the other got in directly. Why does the government think it should receive 14% extra in the first case? Not justifiable IMHO. But then, they don't even try to justify it, they simply make up "employment statuses" and corresponding tests to make it look as though these things are some kind of law of nature rather than the nonsensical invention of Mankind (or a deluded subset of Mankind).
ER NI is certainly a tax on EMPLOYMENT (as opposed to SELF-EMPLOYMENT). That's the key differentiation. Why should employment be taxed so heavily compared to other ways of working? Why should people who can be got rid of at the drop of a hat be "deemed" to be employed and pay such a heavy tax burden when the idea of self-employment was to understand that their position is precarious by comparison, their ability to claim benefits is restricted, their risk (of being out of work) is far greater. And so on.
Merging EE NI and IT is fine, but ER NI, being paid by an employer, cannot be dealt with so easily. There are hidden issues such as Sch D, investment income etc etc.
Abolition is one option. Another is to expand the threshold at which it becomes payable (currently £2000). But I remain convinced that one way or another it needs to go, certainly for small businesses and investors.
Yes it does beg the question why he would fight it that hard for such a relatively small sum. He's probably telling the truth. And it was apparently the first tax return he'd done, so it would probably faze him a bit, it's so easy to form misconceptions that appear logical and could in fact be correct if the system worked a slightly different way than it actually does.
I'm also in favour of the pre-population argument. It isn't the taxpayers' fault that HMRC are made up of different departments - that's their problem and one that they need to sort out. They should be made to understand that any problems arising from their lack of organisation are their problems and they should not be blaming the poor confused "customer" for the lack of joined-up processes.
In an ideal world, it should not only pre-populate known data, but also demand explanations for any changes made to pre-populated data (using drop-down lists of known reasons as far as possible, to minimise manual checking).
When I re-mortgaged a few years ago, the process was handed to a young thing who was appointed to deal with it by the bank (free service if you use their "in-house legal service", which was actually outsourced to a separate firm).
The first time it came through with SDLT payable I checked that the facts were as per my expectation (that SDLT was not payable on a re-mortgage) and told her that.
After a little discussion, where she tried to persuade me quite forcefully that it was payable, she reluctantly agreed. A few days later... another set of documents arrived and AGAIN it showed SDLT as being payable. I called her again and had the same conversation - she even claimed that she had no recollection of our previous conversation on the subject.
This seemed entirely incompetent to me, given that that's all these people do all day they should know in spades what is payable and when - and when it's not due,
I was annoyed by this time, so I complained to one of the "senior" partners in the firm who filled the role of dealing with complaints. I found the usual closing of ranks one finds in most companies these days and eventually gave up (as the process is designed to achieve).
It was only when I read this article that it occurred to me... that maybe this was not incompetence, maybe it was a deliberate attempt to line their pockets by fraudulent means.
Perhaps I should resurrect this complaint and take it to the Ombudsman? I can't help but wonder how systemic it may be to rip off some poor folks who are re-mortgaging and don't realise that SDLT is not payable, I'm sure many people who will just stump up the cash.
Granted there may be no legal definition of the word 'sport' but the point is that under no definition would anyone class Bridge as one.
I already gave you a definition whereby bridge is within the definition of a sport - the original meaning of the word. Re-read earlier post re original meaning. And... as long as there's no legal definition then anyone can have their own definition. Also, the EBU case pointed out that other countries include "mind sports" in the definition of those who can enjoy such tax advantages.
And please don't tell me that wishing to benefit from the tax advantages is in some way wrong - it's perfectly normal/reasonable to do that and should be no surprise to anyone.
As I said, if parliament wanted to include some recreational activities and exclude others then they needed to use clearer language. That's a phrase that's been used before by senior judges and seems very apt in this case.
Most bridge clubs are run on a non-profit basis for the local community's benefit and as such qualify for charitable status. For HMRC to be their usual greedy money-grabbing selves over VAT is as unreasonable as it is unsurprising.
... what untruth did I divulge, other than one imagined in that anomalous maelstrom that passes for your mind.
Feeble. Schoolboy debating tactics again - wait a couple of posts and claim ignorance of your previous failings. It's there in black and white for all to see.
Quote:
Yes, I enjoy word play.
Really? You'd think you'd be better at it then.
The rest of your drooling greying gibberish was a waste of cyber-space.
Time to call a halt. You've fouled an interestng discussion and I doubt that anyone else is even reading this any more. You can have the last word, there are some folk who are dumb enough to believe that whoever has the last word must be right, so feel free to pander to them.
I won't even waste time typing my opinion of you - it must be obvious.
Goodbye? Nah, just get lost.
End. I'll be closing the window and reading no further.
Quite obviously though I do have the brains I was born with or I would be dead - Doh!
Good grief. Is that all you can dream up - yet more stupid little word games?
You were caught in a lie, following endless twaddle and all you can do is write more twaddle. I'm not wasting any more time reading your utter drivel. Get lost.
My answers
Sigh
Unfortunately incorrect statements regarding important matters must be refuted, or some people will believe them. Sadly, that takes time.
Mr Feltham, sigh
What a lot of words to say very little. I'll avoid massive quotes and take - or shouldI say refute - your points in order.
1. It may be "cheaper" for HMRC to negotiate than to litigate, that was quite clearly NOT the point. The point is that if they are getting nowhere near the sums owed then they need to litigate - and we are given to understand that they are in many cases settling for pitiful percetanges of the sums that should be due.
it was also very clearly pointed out that they are prepared to jump through hoops to set precedent with laws such as IR35 but fail to do the same when there are far larger sums per unit at stake.
2. Primarolo. Enough said. However, the driving force behind IR35 was, once again, NOT the issue - it was the psychological aspect of their legal strategy that HMRC admitted to that was the point of that discussion.
3. "Demand extra powers". Yeeees... I clearly meant legislation.
All the stuff you wrote about precedent... not really relevant. Precedent can only take priority over primary legislation where that legislation is not clear, or may not be on point - to have precedent, there must be a case to set one - and for that to happen, there has to be a law to argue about in that case to begin with.
When HMRC don't like what they are seeing in how things operate, they demand extra powers enshrined in statutory law - such as IR35 when they didn't like the high dividends route. Of course, if the law is as poorly drafted as IR35 is/was then there can be ensuing case law, but that's not the point - the point is that prior to IR35 they had no way to go after the tax/NI that they now can with IR35 in place.
4. Principle v Principal.
You pasted a lot of stuff from a dictionary showing the correct definitions of those words - and thereby proved that you don't understand them. Your first post's title began: "The Principle Reason..." which was clearly intended to mean "the main reason" and that should therefore have been "The principal reason".
5. Nothing new about senior HMRC officials going to lunch with execs of companies?
Who said there was? Once again you chose to completely miss the point, which was very clear. I don't care if it's new, I didn't say it was new, what I did say is that it does not appear ever to have been investigated - and it should be IMO.
What a terrible waste of my time responding to your posts - please don't waste any more? Squirming is so unseemly - when you're wrong, you're wrong - move on.
In response to...
Donald6000 - it would only be the top people (the ultimate decision-makers) who might be in a position to do something less than ethical.
Michael Feltham - as I said before, it is not logical that HMRC shy away from fighting cases in court over large sums of money due to time issues. We only need look at the extremes to which they went to set precedent in IR35 cases to see that they are more than willing to do this for small sums, so it makes no sense to duck out when large sums are at stake.
They have also admitted that their IR35 strategy is largely psychological - once they win one, they expect others to fall into line quickly. However, any such excuses should now be a thing of the past with the new tax measures announced in the Budget re profit-shifting.
All in all, the time taken is not a valid argument given the sums at stake - if it were so, you can bet that they'd have been demanding extra powers a long time ago.
And ummm... dare I mention, re the title of your post, that it would be the "principal" reason (not "principle").
I'd also add that the reports one hears of senior Treasury / HMRC people going to lunch with senior executives of companies to discuss their tax bill should have led to these questions being asked a long time ago.
Post-HMRC roles?
At the time of the banking crisis there were many commentators says "They don't even apologise for what they've done".
Be careful what you wish for - the great and good realised that apology was actually a really good idea, so what we now see is many of them donning the hair shirt for a day as penance for a life of (what many of us see as) crime. and there are laws against much of what is being done.
So the modern world, if you're big enough, consists of:
1. Do what you like.
2. When it comes to light, apologise.
3. Be dragged in front of some enquiry committee, apologise again, evade questions.
4. Go home free.
5. Go to step 1.
These proceedings are a show, nothing more. This is what politicians now do when they intend to take no real action. HMRC will continue to target SMEs and make cosy deals with big business. However, HMRC's actions and the reasons we are given are not logical - even though they may have to wait years to get their money, penalties of HMRC's choosing plus interest should be enough to make most pay up sooner. £15bn is a relatively small figure, an Amazon / Starbucks or two would garner that, so it makes no sense, unless...
Has anyone ever looked into what HMRC people do after life as a taxman? We've seen MPs being appointed to directorships - even taking cash while in office. Perhaps we need to check for similar activities among their tax-collecting brethren? Where are Panorama when you need them?
Now let me be clear - I am accusing anyone of anything. I know of no evidence to suggest that any such thing is going on. But we have to wonder why they behave as they do and in doing so we need to look for possible motives. We all know the expression "if it walks like a duck...", so when something seems to walk with a wobbly gait, it may just be a normal person, not too steady on their pins or... it may be the other reason. It behoves us to check it out, as is currently done with MPs?
Employers NI view from the tax PAYER's perspective
I disagree. If you look at it from the point of the tax collector it looks as you describe, but when you look at it as a tax PAYER it's very different - perhaps not so much if you're a standard employee, but certainly if you are a taxpayer who would be self-employed (under sole trader / Sch D rules) if it were not for S44 etc.
A contractor who earns £100 a day and has found his work directly with the client company can happily operate under Sch D whereby the Treasury receives no ER NI whatsoever, from anyone.
The chap sitting next to him, doing the same work, is likely to be costing the client the same i.e. the client will pay the same amount to each of them. BUT... if the second guy is forced to use a Ltd Co, possibly because the work was found via an agency, then he now has to either:
(a) Deduct 14% ER NI from the £100 / day his Ltd Co receives or
(b) Use some non-PAYE form of remuneration, such as dividends or a hybrid approach.
Clearly the take-home pay is the key issue and it is equally clear that the first person takes home more than the second (if the second uses, or is forced to use, PAYE).
The only difference between the two of them is that one of them found the work via a call from an agent and the other got in directly. Why does the government think it should receive 14% extra in the first case? Not justifiable IMHO. But then, they don't even try to justify it, they simply make up "employment statuses" and corresponding tests to make it look as though these things are some kind of law of nature rather than the nonsensical invention of Mankind (or a deluded subset of Mankind).
ER NI is certainly a tax on EMPLOYMENT (as opposed to SELF-EMPLOYMENT). That's the key differentiation. Why should employment be taxed so heavily compared to other ways of working? Why should people who can be got rid of at the drop of a hat be "deemed" to be employed and pay such a heavy tax burden when the idea of self-employment was to understand that their position is precarious by comparison, their ability to claim benefits is restricted, their risk (of being out of work) is far greater. And so on.
Merging EE NI and IT is fine, but ER NI, being paid by an employer, cannot be dealt with so easily. There are hidden issues such as Sch D, investment income etc etc.
Abolition is one option. Another is to expand the threshold at which it becomes payable (currently £2000). But I remain convinced that one way or another it needs to go, certainly for small businesses and investors.
Fighting hard
Yes it does beg the question why he would fight it that hard for such a relatively small sum. He's probably telling the truth. And it was apparently the first tax return he'd done, so it would probably faze him a bit, it's so easy to form misconceptions that appear logical and could in fact be correct if the system worked a slightly different way than it actually does.
I'm also in favour of the pre-population argument. It isn't the taxpayers' fault that HMRC are made up of different departments - that's their problem and one that they need to sort out. They should be made to understand that any problems arising from their lack of organisation are their problems and they should not be blaming the poor confused "customer" for the lack of joined-up processes.
In an ideal world, it should not only pre-populate known data, but also demand explanations for any changes made to pre-populated data (using drop-down lists of known reasons as far as possible, to minimise manual checking).
It's worse than that...
When I re-mortgaged a few years ago, the process was handed to a young thing who was appointed to deal with it by the bank (free service if you use their "in-house legal service", which was actually outsourced to a separate firm).
The first time it came through with SDLT payable I checked that the facts were as per my expectation (that SDLT was not payable on a re-mortgage) and told her that.
After a little discussion, where she tried to persuade me quite forcefully that it was payable, she reluctantly agreed. A few days later... another set of documents arrived and AGAIN it showed SDLT as being payable. I called her again and had the same conversation - she even claimed that she had no recollection of our previous conversation on the subject.
This seemed entirely incompetent to me, given that that's all these people do all day they should know in spades what is payable and when - and when it's not due,
I was annoyed by this time, so I complained to one of the "senior" partners in the firm who filled the role of dealing with complaints. I found the usual closing of ranks one finds in most companies these days and eventually gave up (as the process is designed to achieve).
It was only when I read this article that it occurred to me... that maybe this was not incompetence, maybe it was a deliberate attempt to line their pockets by fraudulent means.
Perhaps I should resurrect this complaint and take it to the Ombudsman? I can't help but wonder how systemic it may be to rip off some poor folks who are re-mortgaging and don't realise that SDLT is not payable, I'm sure many people who will just stump up the cash.
Already covered this point
I already gave you a definition whereby bridge is within the definition of a sport - the original meaning of the word. Re-read earlier post re original meaning. And... as long as there's no legal definition then anyone can have their own definition. Also, the EBU case pointed out that other countries include "mind sports" in the definition of those who can enjoy such tax advantages.
And please don't tell me that wishing to benefit from the tax advantages is in some way wrong - it's perfectly normal/reasonable to do that and should be no surprise to anyone.
As I said, if parliament wanted to include some recreational activities and exclude others then they needed to use clearer language. That's a phrase that's been used before by senior judges and seems very apt in this case.
Most bridge clubs are run on a non-profit basis for the local community's benefit and as such qualify for charitable status. For HMRC to be their usual greedy money-grabbing selves over VAT is as unreasonable as it is unsurprising.
I wish I had time to hear more of this
Feeble. Schoolboy debating tactics again - wait a couple of posts and claim ignorance of your previous failings. It's there in black and white for all to see.
Really? You'd think you'd be better at it then.
The rest of your drooling greying gibberish was a waste of cyber-space.
Time to call a halt. You've fouled an interestng discussion and I doubt that anyone else is even reading this any more. You can have the last word, there are some folk who are dumb enough to believe that whoever has the last word must be right, so feel free to pander to them.
I won't even waste time typing my opinion of you - it must be obvious.
Goodbye? Nah, just get lost.
End. I'll be closing the window and reading no further.
Boring
Good grief. Is that all you can dream up - yet more stupid little word games?
You were caught in a lie, following endless twaddle and all you can do is write more twaddle. I'm not wasting any more time reading your utter drivel. Get lost.