Hacked by Loard Mahdi

Read more...

Breaking news from the BBC Paper tax returns to be replaced by digital by 2020

Read more...

Prime Minister pledges tax cuts

Read more...

Wine smugglers sentenced in £5m wine fraud

Read more...

Pensioner convicted for anti-snoring VAT scam

Read more...

Contact Us
News Items
Tax Tips

Great with People
Brilliant with numbers
Clear and precise with words
 


Call us now on 023 8083 6900 ABDS Home

Tax Tip

HMRC sends out Tax Avoidance letters.

HMRC sent letters directly to 1,500 people who have signed up to one particular avoidance scheme, urging them to pull out and contact the authorities about their tax affairs. The letters, thought to be the first of their kind, are seen as a pre-emptive strike by the taxman prior to a legal challenge to the as yet unspecified avoidance scheme.

One of the Tax Avoidance schemes that HMRC have published details on is the Share Loss Relief Scheme, in which an individual subscribes for shares issued by a company.  Subscribers pay only a small proportion of the nominal cost of the shares themselves, with the balance met by 'loans'.  If the company fails, they either:

  • are not required to repay the 'loans'
  • repay them out of funds provided to them in a non-taxable form

The company is said to be carrying on a high-risk commercial activity - but that activity has little or no realistic prospect of success. Shortly after the company issues the shares, its activities are declared to have failed so that the shares are said to have become of negligible value or are sold for very little. The individuals make claims to set the resulting capital losses on the shares against their taxable income.

Although HMRC have not been specific about the scheme they are targeting, Stuart Coleman, Manager of the Tax Department of ABDS comments:
“If HMRC suspect an individual of using one of these schemes, they will open an enquiry into the return and won't make any tax repayment claimed. If information is concealed, or if incorrect or misleading information is provided, HMRC may also seek civil penalties or - in appropriate cases - consider criminal prosecution.”

In a statement, HMRC explained: “The letters are designed specifically to get those using a marketed avoidance scheme to contact us and settle up. We are acting on behalf of the vast majority of people who don't try to get around the rules. We are cracking down hard on tax dodging.”


If you need any help and advice for your Tax and the implications of the HMRC initiatives, contact Lavinia Newman, Stuart Coleman or Tonmoy Kumar to discuss how ABDS can help

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail: abds@netaccountants.net

Great with People  Brilliant with numbers Clear and precise with words
 

« Back to Tax Tips