Tax avoidance has been much in the press lately and is likely to keep attracting attention and opprobrium, both from the Government and in the papers.
HMRC, in the same vein, continue to seek out and challenge avoidance schemes used by taxpayers. There have been a string of recent court decisions involving what HMRC consider avoidance arrangements, including Murray Group Holdings (the “Rangers” case), which is now being appealed to the Supreme Court; the Eclipse 35 film tax partnership decision; and the UBS and Deutsche Bank case involving bonus arrangements for their employees.
The courts have, to date, largely favoured HMRC in these cases. In particular, the UBS decision shows the adoption by the Supreme Court of a firmly purposive approach to the legislation, which focuses on Parliament’s intention rather than on a strict interpretation of the statutory wording.
This means that for many taxpayers, HMRC may now be seeking to challenge arrangements implemented at a time when the climate for tax planning was more robust than is now the case. Similarly, taxpayers may now be looking to unwind historic avoidance schemes – for example, in relation to Employee Benefit Trusts (EBTs).
How Pett Franklin can help
Pett Franklin are experienced in negotiating settlements with HMRC, and look to achieve the best possible outcome for taxpayers while bringing matters to a clear and final conclusion on all sides. We are also able to provide practical guidance for taxpayers concerned about their tax affairs.