9am Lowdown: Litigation decisions, EY, & VAT fraud

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Good morning and welcome to Tuesday's 9am Lowdown. 

News round-up

EY is replacing KPMG as BHP Billiton's auditor. According to the City A.M report, EY will take over from 1 July 2019, meaning rival KPMG will audit BHP's 2017, 2018 and 2019 sets of accounts.

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GOV.UK has release a report that lists litigation decisions where HMRC considered tax avoidance was involved.

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Private hospitals will get a £52m tax break on their business rates through their charitable status over the next five years while the bill for NHS hospitals rises. (The Times)

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A call centre worker from Swansea, who set up a company to sell men’s designer underwear as a front to steal more than £50,000 from taxpayers through a VAT fraud, has been jailed. (HMRC press release)

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New on AccountingWEB

Andrew Robins provides an update on the legislation to impose tax and NIC charges on the value of contractor loans and ETB loans which remain outstanding at April 2019.

Les Howard explains how a tiny charity defeated HMRC at the tax tribunal over the method it uses to calculate the amount of input VAT it could reclaim.

The Any Answers question of the day comes from Practice Partner who asks: Is KPMG's small business service gaining market share at the expense of local accountants?

Blogger Simon Sweetman is hanging up his quill. Here is his last missive.

And IRIS profiles Stewart Accounting Services, an IRIS Accountancy Suite user, on its Industry Update page.   

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22nd Aug 2017 12:30

Interesting how Tower Radio threw in the towel at CoA. I did not know that (but unsurprising given the treatment tax avoidance schemes get in the higher courts). See:
https://www.gov.uk/government/publications/tax-avoidance-litigation-deci...

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to Justin Bryant
22nd Aug 2017 17:14

Justin Bryant wrote:

Interesting how Tower Radio threw in the towel at CoA. I did not know that (but unsurprising given the treatment tax avoidance schemes get in the higher courts). See:
https://www.gov.uk/government/publications/tax-avoidance-litigation-deci...

Interesting in what way?

One could be forgiven for thinking you are accusing the higher courts of generally ruling against schemes, regardless of the correct legal position. That's a fairly serious allegation to make if that is what you mean.

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to stepurhan
22nd Aug 2017 18:55

I do not normally respond to ridiculous and pointless comments like yours, but that is obviously exactly what I mean! (Only a complete fool would think otherwise.) Any tax barrister will tell you that the majority of judges will bend over backwards to do down a tax avoidance scheme. Those appearing for HMRC say it's like starting a game of tennis where you are serving at 40 love up etc. The statistics in the above link bear that out. Needles to say, HMRC fully appreciate that too, which is why they will always try to appeal all the way to SC if necessary (which, as far as I am aware, has never given the thumbs up to a tax avoidance scheme, although it refused HMRC permission to appeal in Mayes, but it refuses the taxpayer permission to appeal far more often).

This view is endorsed as follows by the eminent authors in the link below:

"Can we really expect such blatant, unattractive devices to succeed in avoiding tax? Not today: when the water flows we must expect tax to be attracted no matter what the detailed rules seem to say: that is the general trend of the cases. But how happy should we be with the idea that something over 25,000 pages of detailed rules can be reduced to whether the court thinks something should be taxed. The rule of law is under threat in this country in so many ways and tax is an unattractive topic to use in its defence. But it would be nice to think that, at some point, we shall again be enamoured of the idea that rules matter. "

https://www.taxjournal.com/articles/rangers-fc-case-payments-remuneratio...

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