Cases like this demonstrate how desperately detached from reality some inspectors are within HMRC, and judging by the behaviour I have personally encountered their number is increasing.
The stress and disruption caused to innocent taxpayers as a consequence of wholly illogical, perverse and unreasonable views, applications of legislation, and behaviour that is frequently contradictory to established case law is of no relevance to these inspectors and my dismay at the intellectual naivety displayed by these individuals grows.
There needs to be some checks and balances to stop such nonsensical cases being pursued. It is a waste of the money we pay in tax and diverts resources where genuine malfeasance and abuse of the tax system arises.
One has to question whether such blatantly contrived and ill founded schemes peddled by questionable outfits and practitioners should actually be pursued as evasion through criminal code. I've reviewed less reprehensible cases than this which have been prosecuted as such.
Purveyors of tax artifice who seek to hide behind an irresponsible, dubious and untested QCs opinion would soon be scuttling back under their rocks.
This is my understanding too. In my view it should always have been the 'large' client who was responsible for picking up the liability as frequently they held the balance of power in negotiating a contract with a consultant, and therefore they would usually be responsible for including any clauses that would create difficulties with an HMRC enquiry into status.
My understanding of this new regime (and please correct me if I'm wrong!) is that the rules surrounding the determination of whether a contract of engagement falls within IR35 or not have not actually changed, but what has changed is where the liability falls should HMRC successfully prosecute a case.
With this in mind, if parties to a contract were satisfied that the agreed Ts & Cs were sufficient to protect their arrangement from attack by HMRC under disguised employment rules then these same Ts & Cs are sufficient now.
As a consequence all this hoopla and panic that has swept in across HR departments is misplaced and engagements of subcontractors through their own Ltd Cos can & should continue with the usual diligence and inclusion of these key Ts & Cs.
I look forward to hearing from any dissenting commentators!
My understanding of this new regime (and please correct me if I'm wrong!) is that the rules surrounding the determination of whether a contract of engagement falls within IR35 or not have not actually changed, but what has changed is where the liability falls should HMRC successfully prosecute a case.
With this in mind, if parties to a contract were satisfied that the agreed Ts & Cs were sufficient to protect their arrangement from attack by HMRC under disguised employment rules then these same Ts & Cs are sufficient now.
As a consequence all this hoopla and panic that has swept in across HR departments is misplaced and engagements of subcontractors through their own Ltd Cos can & should continue with the usual diligence and inclusion of these key Ts & Cs.
I look forward to hearing from any dissenting commentators!
I read some of the comments above and I am startled by the naivety and lack of knowledge exercised by some of those posting above.
Over 10 years ago the retrospective tax legislation introduced by FA2008 was found to be effective after Huitson challenged it in respect of a tax avoidance scheme utilised in 2001. This case has been pursued through all the courts in the land and Europe and every time HMRC wins.
With this in mind I am amazed that any tax adviser of any credibility allows or even promotes any product carrying a DOTAS number to their clients. Ignoring the precedent of Huitson is indolent to the point of negligence and it brings our profession into disrepute.
There is a growing swell of political opinion that seeks to bring those who peddled these schemes to account for their culpability, and I can see grounds for such legislation- perhaps this can be enacted retrospectively too?
This view is not upholding 'the moral high ground': It is merely a desire to see those who ignore past precedent, who push clients and create these wholly artificial arrangements, who merrily take their commissions and sail off shrugging their shoulders when these schemes inevitably fail be admonished for their role in this debacle.
We have a responsibility to advise and guide clients who do not have our breadth of knowledge, not exploit them to earn pathetic commissions from marketed tax avoidance schemes. It is sad that some of the posters above are somewhat less than committed to this view.
Surprisingly it wasn't written for your interest or entertainment: If you need a friend I suggest you get a dog, but until then please stop filling these pages with sycophantic claptrap seeking affirmation for mistaken belief and perverse conclusion. The comments made by SculptureOfMan and AndrewV12 sum up the position succinctly and fairly.
Good luck with your future endeavours Justin, an OBN is on its way to you...
My answers
Cases like this demonstrate how desperately detached from reality some inspectors are within HMRC, and judging by the behaviour I have personally encountered their number is increasing.
The stress and disruption caused to innocent taxpayers as a consequence of wholly illogical, perverse and unreasonable views, applications of legislation, and behaviour that is frequently contradictory to established case law is of no relevance to these inspectors and my dismay at the intellectual naivety displayed by these individuals grows.
There needs to be some checks and balances to stop such nonsensical cases being pursued. It is a waste of the money we pay in tax and diverts resources where genuine malfeasance and abuse of the tax system arises.
I thought the name was familiar. It seems Mr Hannah has a habit of losing tax cases:
https://www.todaysconveyancer.co.uk/main-news/advisor-fined-sdlt-avoidance/
One has to question whether such blatantly contrived and ill founded schemes peddled by questionable outfits and practitioners should actually be pursued as evasion through criminal code. I've reviewed less reprehensible cases than this which have been prosecuted as such.
Purveyors of tax artifice who seek to hide behind an irresponsible, dubious and untested QCs opinion would soon be scuttling back under their rocks.
Not sure the Supreme Court agrees with your view on the 'worker' term John.
Not sure the Supreme Court agrees with your view on the 'worker' term John.
This is my understanding too. In my view it should always have been the 'large' client who was responsible for picking up the liability as frequently they held the balance of power in negotiating a contract with a consultant, and therefore they would usually be responsible for including any clauses that would create difficulties with an HMRC enquiry into status.
My understanding of this new regime (and please correct me if I'm wrong!) is that the rules surrounding the determination of whether a contract of engagement falls within IR35 or not have not actually changed, but what has changed is where the liability falls should HMRC successfully prosecute a case.
With this in mind, if parties to a contract were satisfied that the agreed Ts & Cs were sufficient to protect their arrangement from attack by HMRC under disguised employment rules then these same Ts & Cs are sufficient now.
As a consequence all this hoopla and panic that has swept in across HR departments is misplaced and engagements of subcontractors through their own Ltd Cos can & should continue with the usual diligence and inclusion of these key Ts & Cs.
I look forward to hearing from any dissenting commentators!
My understanding of this new regime (and please correct me if I'm wrong!) is that the rules surrounding the determination of whether a contract of engagement falls within IR35 or not have not actually changed, but what has changed is where the liability falls should HMRC successfully prosecute a case.
With this in mind, if parties to a contract were satisfied that the agreed Ts & Cs were sufficient to protect their arrangement from attack by HMRC under disguised employment rules then these same Ts & Cs are sufficient now.
As a consequence all this hoopla and panic that has swept in across HR departments is misplaced and engagements of subcontractors through their own Ltd Cos can & should continue with the usual diligence and inclusion of these key Ts & Cs.
I look forward to hearing from any dissenting commentators!
I read some of the comments above and I am startled by the naivety and lack of knowledge exercised by some of those posting above.
Over 10 years ago the retrospective tax legislation introduced by FA2008 was found to be effective after Huitson challenged it in respect of a tax avoidance scheme utilised in 2001. This case has been pursued through all the courts in the land and Europe and every time HMRC wins.
With this in mind I am amazed that any tax adviser of any credibility allows or even promotes any product carrying a DOTAS number to their clients. Ignoring the precedent of Huitson is indolent to the point of negligence and it brings our profession into disrepute.
There is a growing swell of political opinion that seeks to bring those who peddled these schemes to account for their culpability, and I can see grounds for such legislation- perhaps this can be enacted retrospectively too?
This view is not upholding 'the moral high ground': It is merely a desire to see those who ignore past precedent, who push clients and create these wholly artificial arrangements, who merrily take their commissions and sail off shrugging their shoulders when these schemes inevitably fail be admonished for their role in this debacle.
We have a responsibility to advise and guide clients who do not have our breadth of knowledge, not exploit them to earn pathetic commissions from marketed tax avoidance schemes. It is sad that some of the posters above are somewhat less than committed to this view.
https://www.ftadviser.com/your-industry/2018/07/17/hmrc-victorious-in-23...
I think you're judging me by your own standards Betty
Surprisingly it wasn't written for your interest or entertainment: If you need a friend I suggest you get a dog, but until then please stop filling these pages with sycophantic claptrap seeking affirmation for mistaken belief and perverse conclusion. The comments made by SculptureOfMan and AndrewV12 sum up the position succinctly and fairly.
Good luck with your future endeavours Justin, an OBN is on its way to you...