Tax avoidance schemes – when things go wrong

News - 08/12/2016

Firms have spent years promoting tax avoidance schemes to both corporate and individual taxpayers and have earned large fees whilst doing so.

However, between July 2015 and March 2016 of the 26 cases involving alleged tax avoidance which were litigated, HMRC won 23 of those cases.

Since April 2016, thanks to HMRC’s success in challenging schemes by Ingenious Film Partnership and Icebreaker, HMRC have secured more than £1.2 billion in disputed tax.

Taxpayers who are involved in failed schemes face on top of the tax originally avoided large bills for legal costs, interest and penalties

Taxpayers who cannot pay these bills risk potential insolvency unless they can negotiate extended time to pay plans with HMRC.

In the case of some of the SDLT avoidance schemes, taxpayers have placed their homes into trust and exchanged contracts for the onward sale of their homes with completion to take place in 35 years time, for a fraction of market value.

Taxpayers who are involved in tax avoidance schemes should seek urgent legal advice on what if any remedies are available to them.

If you would like advice or assistance on any of the issues raised in this blog please contact Morrisons Solicitors tax litigation expert Sally Hutchings. Sally can be contacted by email at [email protected]  or by telephone 020 8971 1048.

Disclaimer:

Although correct at the time of publication, the contents of this newsletter/blog are intended for general information purposes only and shall not be deemed to be, or constitute, legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article. Please contact us for the latest legal position.