Tax Take
Gill - Tribunal rejects HMRC's interim applications
In Gill v HMRC [2017] UKFTT 0597 (TC), the First-tier Tribunal (FTT) dismissed three interim applications made by HMRC for (1) permission to adduce expert evidence; (2) a direction excluding a large amount of documentation adduced by the taxpayer; and (3) a direction that the taxpayer disclose data in an alternative format to that provided by the taxpayer.
Read moreChadwick – Discovery assessment on wrong person cannot be remedied by section 114 TMA
In Chadwick (as trustee in bankruptcy of Mrs Gloria Oduneye-Braniffe) v The National Crime Agency [2017] UKFTT 656 (TC), the First-tier Tribunal (FTT) has held than an assessment issued to a trustee in bankruptcy was a gross error that could not be cured by section 114 of the Taxes Management Act 1970 (TMA).
Read moreTax update, October 2017
In this update we report on HMRC’s recently published guidance concerning the new offences of failing to prevent the facilitation of tax evasion; HMRC’s new powers to refuse to register or de-register master trust pension schemes; and new guidance on investors’ relief in the CGT context.
Read moreBailey: Quality trumps quantity as Tribunal grants taxpayer principle private residence relief
In Stephen Bailey v HMRC [2017] UKFTT 658 (TC), the First-tier Tribunal (FTT) granted the taxpayer principle private residence relief, under section 222, Taxation of Chargeable Gains Act 1992 (TCGA), despite having only occupied the property in question for two periods of less than six months.
Read moreVAT update September 2017
In this month’s update we report on the Commission’s evaluation of invoicing rules; revisions to VAT notice 700/50, concerning default surcharge; and details of the consultation on the Making Tax Digital reforms.
Read moreGekko – HMRC's unreasonable conduct leads to costs award against it
In Gekko & Company Ltd [2017] UKFTT 586 (TC), the First-tier Tribunal (FTT), in allowing an appeal against assessments to VAT and penalties, awarded the taxpayer its costs as HMRC's conduct had been unreasonable.
Read moreThathiah: HMRC unsuccessful in first senior accounting officer penalty appeal
In Kreeson Thathiah v HMRC [2017] UKFTT 0601 (TC), the First-tier Tribunal (FTT) allowed an appeal against penalties which had been assessed on the finance director of a group of companies under the Senior Accounting Officer (SAO) regime, contained in Schedule 46, Finance Act 2009 (FA 2009), as HMRC had failed to establish that he had breached his duty as a SAO.
Read moreSettlement considerations following the Rangers decision
Following the Supreme Court’s recent judgment in the Rangers case, many employers who had established employee benefit trusts (EBTs) are facing enforcement notices in respect of income tax and National Insurance contributions.
Read moreHickey Plant Hire - Taxpayer successfully challenges HMRC's narrow reading of penalty rules
In M J Hickey Plant Hire and Contracts Ltd v HMRC [2017] UKUT 308 (TCC), the Upper Tribunal (UT) allowed the taxpayer's appeal and in a carefully considered judgment sets out the correct approach to the penalty rules applicable to 'normal' and 'delayed tax' cases, contained in Schedule 24, Finance Act 2007 (FA 2007).
Read moreTax update, September 2017
In this month’s update we report on HMRC’s new guidance on asset-based penalties for offshore inaccuracies; the GAAR Advisory Panel’s first published opinion on tax planning involving gold bullion and Spotlight 39 on measures designed to avoid the 2019 EBT loan charge.
Read moreCorporate tax update, second quarter 2017
Welcome to the latest edition of our Corporate Tax Update, written by members of RPC’s tax team and published quarterly.
Read moreVigne - HMRC lose business property relief case
In The Estate of Maureen W Vigne (deceased) v HMRC [2017] UKFTT 632 (TC), the First-tier Tribunal (FTT) has determined that the estate of the late Maureen Vigne was entitled to business property relief (BPR), as provided for in section 105, Inheritance Tax Act 1984 (IHTA).
Read moreVAT update August 2017
In this month’s update we report on updated guidance from HMRC on distance selling, the EU (Withdrawal Bill) and the revised place of supply rules for B2C telecommunications.
Read moreBPP – Tribunal correct to strike out HMRC's case for failure to comply with Rules and Directions
In BPP Holdings Ltd v HMRC [2017] UKSC 55, the Supreme Court has confirmed that the First-tier Tribunal (FTT) was justified in directing that HMRC be barred from taking further part in the proceedings for failure to adhere to the Tribunal’s Rules and Directions.
Read moreCustoms and excise quarterly update, August 2017
In this update we report on the implementation of the Fulfillment House Due Diligence Scheme, the National Audit Office's report on the new Customs Declaration Service and the future excise duty rate changes to cooking wine and other cooking alcohol.
Read moreWealth and trusts quarterly digest, August 2017
Our quarterly digest provides up to date commentary and analysis on key sector developments.
Read moreEastern Power – Tribunal orders HMRC to close its enquiries despite outstanding information notices
In Eastern Power Networks Plc and others v HMRC [2017] UKFTT 494 (TC), the First-tier Tribunal (FTT) ordered HMRC to issue closure notices even though there were a number of outstanding information notices.
Read moreGray – FTT allows appeal against discovery assessment as ITV correctly accounted for PAYE
In Gray v HMRC [2017] UKFTT 0275, the First-tier Tribunal (FTT) allowed the taxpayer's appeal against a discovery assessment in relation to a termination payment as there was no additional tax to assess in the relevant year and in any event the assessment was out of time.
Read moreRangers: Supreme Court confirms remuneration paid through EBT is subject to income tax
In RFC 2012 Plc (in liquidation) (formerly The Rangers Football Club Plc) v Advocate General for Scotland [2017] UKSC 45, the Supreme Court has held that remuneration payments made into an employees' remuneration trust were earnings for income tax and NICs purposes.
Read moreTax update, August 2017
In this update we report on the Government’s intention to use the Finance Bill (No. 2) 2017 to retrospectively implement the policies dropped from the first Finance Act 2017; amendments to the new disguised remuneration provisions in the Income Tax (Earnings and Pensions) Act 2003; and the implementation of the guidance requirement under the Criminal Finances Act 2017
Read moreDerry – HMRC prevented from collecting tax in avoidance case
In R (ota of James Derry) v HMRC [2017] EWCA Civ 435, the Court of Appeal, in allowing the taxpayer's appeal, confirmed that HMRC is not able to ignore a claim for carried back loss relief where the taxpayer has self-assessed and computed his liability to tax.
Read moreVAT update, July 2017
In this month’s update we report on HMRC’s recent guidance on its approach to supply splitting; the Supreme Court hearing in the Littlewoods compound interest case; and the revised timetable for “Making Tax Digital”.
Read moreNew corporate criminal offence
Failure to prevent the facilitation of tax evasion
Read moreOval Estates - Tribunal confirms deficiencies in invoices may not prevent VAT recovery
In Oval Estates (Bath) Limited v HMRC [2017] UKFTT 403 (TC), the First-tier Tribunal (FTT) held that input tax was attributable to an identifiable supply and was recoverable despite allegations of deliberate and concealed behaviour.
Read moreMärtin: Application directing HMRC to close its enquiry into tax avoidance scheme granted
In Jörg Märtin v HMRC [2017] UKFTT 488 (TC), the First-tier Tribunal (FTT) directed HMRC to close its enquiry as it had taken no action in three years.
Read moreAnstock - Tribunal quashes penalties imposed for failure to comply with information notice
Penalties for failure to comply with an information notice issued by HMRC can only be imposed if the information notice in question is unambiguous, clear and precise.
Read moreTax update, July 2017
In this month’s Update we report on draft provisions for a EU wide cross-border tax planning disclosure requirement; changes to HMRC’s guidance on the WDF and announcements in the Queen’s Speech in relation to the next Finance Bill.
Read moreBerlioz - ECJ confirms that third parties can challenge 'foreseeable relevance' of tax information exchange requests
In Berlioz Investment Fund SA v Directeur de l'administration des Contributions directes (Case C-682/15), the ECJ has confirmed that a Member State's national court can review a tax information request made by another Member State in order to assess whether the requested information is 'foreseeably relevant'.
Read moreVAT update, June 2017
In this month's update we report on proposals for the reduced VAT rate for e-publications, HMRC's first publication of VAT Notes 2017, in which it explains changes to VAT for businesses, and the latest stage in the long-running compound interest litigation involving Littlewoods.
Read moreRai - Tribunal quashes penalties for non-payment of PPNs and criticises HMRC's 'nitpicking pedantry'
In Rai v HMRC [2017] UKFTT 0467 (TC), the First-tier Tribunal (FTT) was critical of HMRC's conduct and cancelled assessments to penalties which it had issued for failure to pay on time amounts demanded in partner payment notices (PPNs), as the statutory payment period had not expired.
Read morePitcher - Tribunal finds in favour of taxpayer in APN penalty appeal
In Graham Pitcher [2017] UKFTT 0406 (TC), the First-tier Tribunal (FTT) allowed the taxpayer's appeal against a penalty for non-payment of an Accelerated Payment Notice (APN) due to defects in the APN.
Read moreArcher: judicial review in the context of statutory tax appeals
The High Court's judgment in R (on the application of Archer) v HMRC [2017] EWHC 296 (Admin) is one of a number of recent decisions where it has been found that the taxpayer had not challenged HMRC's decision in the correct forum.
Read moreRendall - Tribunal reduces penalties imposed for failure to file a partnership return to nil
In Rendall v HMRC [2017] UKFTT 356 (TC), the First-tier Tribunal (FTT) has reduced penalties imposed on partners for failure to file a partnership return on time to nil as the requisite information had already been disclosed to HMRC in the partners' personal self-assessment returns.
Read moreTax update, June 2017
In this update we report on the scope of the Criminal Finances Bill as it receives Royal Assent; HMRC guidance updates for businesses, individuals and agents on how to make disclosures of unpaid tax; and HMRC’s further consultation on Making Tax Digital.
Read moreTager – Application to suspend penalties for failing to comply with information notices rejected
In HMRC v Romie Tager QC the Personal Representative of Osias Tager [2017] UKUT 161 (TCC), the Upper Tribunal (UT) refused an application that it should exercise its discretion under Rule 5(3) of the Tribunal Procedure (Upper Tribunal) Rules 2008 (the Upper Tribunal Rules) and suspend the effect of its decision to impose tax-related penalties for failing to comply with information notices, pending an appeal to the Court of Appeal.
Read moreVAT update, May 2017
In this month’s update we report on HMRC’s revised guidance on holding companies’ input VAT recovery, prelaunch trials for the online tribunal appeals service and draft legislation effecting the removal of the “use and enjoyment” rule for the supplies of B2C telecommunication services.
Read moreCustoms and excise quarterly update, May 2017
In this update we report on the launch of the register of approved UK alcohol wholesalers, HMRC’s Customs Information Paper 5 (2017) (CIP 5), which clarifies the correct codes to use when sending free circulation goods to the special territories of the EU, and the new address for HMRC’s National Clearance Hub.
Read moreBCM – Tribunal grants taxpayers' application for closure notices
In BCM Cayman LP and others v HMRC [2017] UKFTT 0226 (TC), the First-tier Tribunal (FTT) directed HMRC to issue closure notices within specified time periods in respect of its enquiries into certain of the applicants' tax returns, pursuant to section 28B, Taxes Management Act 1970 (TMA) and paragraph 33, Schedule 18, Finance Act 1998 (FA 1998).
Read moreWealth and trusts quarterly digest
Our quarterly digest provides up to date commentary and analysis on key sector developments from our tax, wealth and trusts teams.
Read moreABL – Tribunal dismisses HMRC's application to vary direction staying related cases
In ABL (Holding) Ltd and Tanias Properties Ltd v HMRC [2017] UKFTT 220 (TC), the First-tier Tribunal (FTT) dismissed HMRC's application to vary the FTT's direction staying over 100 related cases until the determination of the lead appellants' appeals by the Upper Tribunal (UT).
Read moreBudget 2017 Amendments to the QROPS Regime - a Further Breach of EU Law
Back in October 2013, I wrote an article for the Tax Journal (18 October 2013, The QROPS Regime and EU Law) in which I argued that the operation of the qualifying recognised overseas pension scheme (QROPS) system, introduced by Finance 2004, breached EU law and was unlawful. The recent changes introduced by the 2017 Budget not only preserve the inherent unlawfulness which has existed in the system since at least October 2008 but introduces a further breach of EU law rights. The background to the October 2013 article was my involvement in representing individuals who had transferred their UK pensions into a fund called ROSIIP.
Read moreCorporate tax update, first quarter 2017
Welcome to the latest edition of our Corporate Tax Update, written by members of RPC’s Tax team and published quarterly. In this first 2017 edition we highlight some of the key tax developments of interest to UK corporates from the first quarter of 2017.
Read moreTax update, May 2017
In this update we report on HMRC’s recently amended guidance on the General Anti-Abuse Rule, HMRC’s draft guidance on the new disguised remuneration provisions in the Income Tax (Earnings and Pensions) Act 2003, and on the recent modifications to the Finance Bill 2017.
Read moreUpper Tribunal confirms First-tier Tribunal has jurisdiction to amend tax return
In HMRC v Eric Walker [2016] UKUT 32, the Upper Tribunal (UT) has confirmed that the First-tier Tribunal (FTT) has the power, under section 50, Taxes Management Act 1970 (TMA), to amend a return if it decides the taxpayer is entitled to a smaller repayment than the one claimed.
Read moreVAT update April 2017
In this month’s update we report on HMRC’s call for evidence on alternative methods for collecting VAT for online sales, HMRC’s policy on historical VAT bad debt relief claims following the BT and GMAC decisions and the enactment of the insolvency VAT clawback concession. We also comment on three recent cases involving mistake-based claims for unjust enrichment, the VAT treatment of temporary workers and the apportionment of residual input tax for finance houses.
Read moreEuro Packaging UK Limited – classification of long-life shopping bags
In HMRC v Euro Packaging UK Limited [2017] UKFTT 0160, the First-tier Tribunal (FTT) allowed the Appellant's appeal against decisions of HMRC relating to the customs duty to be paid on the importation from countries outside the EU of shopping bags and its refusal to remit the customs duty.
Read moreTribunal cancels penalty imposed against doctor and criticises unreasonable HMRC behaviour
In Dr Ragini Pandey v HMRC [2017] UKFTT 0216 (TC), the First-tier Tribunal (FTT) cancelled a penalty which had been issued by HMRC under paragraph 1, Schedule 24, Finance Act 2007 and in so doing criticised HMRC's 'unreasonable' behaviour.
Read moreClosure Notices defective but JR dismissed as taxpayer should have appealed to the Tribunal
In R (on the application of Archer) v HMRC [2017] EWHC 296 (Admin), the High Court agreed with the claimant that a Closure Notice issued by HMRC must state the tax due, but dismissed his application for judicial review on the ground that he should have appealed to the First-tier Tribunal (FTT).
Read moreTax update, April 2017
In this update we report on recent HMRC guidance on partnership follower notices and penalties, the new employment status checker for the intermediaries legislation (IR35) and details of tax avoidance scheme for income and national insurance contributions which HMRC has highlighted in its Spotlight 37.
Read moreSIPP scheme administrator avoids 'pension liberation' tax charge
In HMRC v Sippchoice Ltd [2017] UKUT 87 (TCC) the Upper Tribunal (UT) has upheld the decision of the First-tier Tribunal (FTT) that Sippchoice should not be subject to scheme sanction charges but said that the FTT's reference to MTIC case law in assessing the evidential burden was incorrect.
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