Stamp Duty retrospective claw back by HMRC

G_M

So you used a dodgy scheme in an attempt to avoid paying tax.

And HMRC have said: no-go. you owe us.

Pleased to hear it. Just as I'm pleased when Google etc are 'outed' for not paying tax (but just wish they could be chased more vigourously).

If you used a 'scheme' you did not fully understand, more fool you. If you did understand the risks of the scheme, well, why are you surprised?

edit: if you need help raising the money owed, PM me- I'm looking for a good quality 2nd hand flat screen TV...

The_optimist_3

I agree re the likes of Google etc avoiding tax but I don't see this in the same arena. This very site is an excellent source for finding loopholes in various systems. Sounds like there was a loophole in the stamp duty law which the advisors have used. They acted in good faith, on the advice of professionals. I don't understand how the HMRC can claim retrospectively, surely we have to follow the letter of the law once that law is introduced. I'd seek legal advice. Good luck.

BazzaDP

The_optimist wrote: »

This very site is an excellent source for finding loopholes in various systems.

Those posts looking for loopholes really annoy me. I see this site as people looking for help and advice and a great community who provide that, not just cheapskates trying to avoid paying their way. Why do people get so upset at big corporations doing that but think it's fine for them to do it? All the "I don't want to pay my TV licence, explain to me how I can pretend I don't watch TV?" posts and the like just bug me. A loophole is, by definition, trying to get round the real intention. Don't be surprised or upset when you are called out for it when it's closed.

Anyway, slightly off topic rant over...

00ec25

you tried a SDLT mitigation scheme , you appear not to have understood what you were buying. It has failed. Quite a few threads on here asking about such schemes , you should have asked before you bought
pay the tax+ interest, you fully deserve to be punished for trying to evade
https://forums.moneysavingexpert.com/discussion/3258276
https://forums.moneysavingexpert.com/discussion/3138642
and here is the Big One
https://forums.moneysavingexpert.com/discussion/2551967

Takeaway_Addict

antrobus wrote: »

Interest on the unpaid tax will accrue from 30 days after the date you completed your purchase (‘the effective date’) until the tax is paid in full

Says the HMRC.



There is nothing wrong in trying. Similarly there is no point complaining if it doesn't work.

Quite, if it backfires or becomes illegal then its tough

antrobus

The_optimist wrote: »

I agree re the likes of Google etc avoiding tax but I don't see this in the same arena.

You're right. What Google does is perfectly legal, and might or might not be 'tax avoidance' depending on your defintition of the term. SDLT avoidance schemes were highly artificial arrangements that bordered on outright tax evasion.

The_optimist wrote: »

....This very site is an excellent source for finding loopholes in various systems.

But not tax avoidance. Martyn Lewis is on record as stating that MSE will not act as a "facilitator" for tax avoidance.

The_optimist wrote: »

....Sounds like there was a loophole in the stamp duty law which the advisors have used. They acted in good faith, on the advice of professionals. I don't understand how the HMRC can claim retrospectively, surely we have to follow the letter of the law once that law is introduced.

See my post above. The 2012 Budget gave a clear warning that retrospective legislation would be used against any future SDLT schemes. I'd therefore question any advisor's 'good faith' on that basis.

The_optimist wrote: »

.... I'd seek legal advice. Good luck.

The legal advice would be that if you want to challenge HMRC you'll have to fight them through the courts. That's going to cost a lot of money.

makeyourdaddyproud

OP now conspicuous by their absence?

kmmr

antrobus wrote: »

But not tax avoidance. Martyn Lewis is on record as stating that MSE will not act as a "facilitator" for tax avoidance.

And yet there is a whole board devoted to ISA's and how to use them to best effect. (Prepares to be flamed)

I think the government should focus on being smarter with it's tax laws and on spending money on enforcing them so people know if they avoid they will get caught. Recent cuts in HMRC that were reported seems like insanity to me - each person produces a lot more in revenue than they cost.

At the moment we seem to be in this strange space where companies are being asked to donate money to appease the masses. The Starbucks tax payment feels a lot like a corporate bribe/donation to allow them to keep operating.

BazzaDP

kmmr wrote: »

And yet there is a whole board devoted to ISA's and how to use them to best effect. (Prepares to be flamed)

ISAs give tax breaks to savers. Their entire intention is to convince people to save and the reduction in tax is the carrot for that. Stamp Duty (and other tax avoidance schemes) are intended to get around the rules intentions.

kmmr wrote: »

At the moment we seem to be in this strange space where companies are being asked to donate money to appease the masses. The Starbucks tax payment feels a lot like a corporate bribe/donation to allow them to keep operating.

Agree totally! HMRC should be deciding tax people pay, not companies making up a number hoping it will get some heat off their back.

grifferz

kmmr wrote: »

And yet there is a whole board devoted to ISA's and how to use them to best effect. (Prepares to be flamed)

Not a flame but you have to admit you are attempting to draw a parallel between a savings scheme defined by the government to not attract tax, and an arrangement such as:

1. A sells property to B for £1million
2. Simultaneously, B agrees to sell property to C - a limited company set up by B for this purpose, with B as sole director - but not to be transferred for 125 years. The compensation for this is £100,000.
3. B argues they pay no SDLT as they are just taking over the contract from A.
4. C argues it pays no SDLT because £100k is below the threshold.

...which is an example of how one of these schemes tried to work.

It's not like the government can just introduce a simple modification to law to clearly make schemes such as the above ineffective. People come up with them, they work for a short while, and then are deemed avoidance.

It seems acceptable for MSE to advise people about the former, less so the latter. If I even brought up the subject of such a scheme to my accountant I would expect her to politely suggest I no longer be a client.

kmmr wrote: »

At the moment we seem to be in this strange space where companies are being asked to donate money to appease the masses. The Starbucks tax payment feels a lot like a corporate bribe/donation to allow them to keep operating.

Agreed. It doesn't have a simple solution though.

(I'm deliberately not listing off my ideas as to how companies operating in UK could be forced to pay the "correct" amount of tax in the UK as it seems very off-topic for this forum)