Littlewoods £1.2BN Tax Refund

On July 3 the Supreme Court will hear an appeal brought by HMRC against Littlewoods, in the latest stage of its long-running dispute over interest payments on a tax refund dating back 30 years.

The FT reports that Littlewoods has already received a £204m refund from HMRC on VAT that was wrongly charged on commissions paid to its agents who distributed mail-order catalogues. It has also received £250m of simple interest on the VAT refund. However, the company contends it should have received £1.2bn of compound interest charged on the interest already earned.

Bill Dodwell of consultancy Deloitte said the case potentially had important consequences for claims by other companies:

“There are a lot of cases stacked behind this one.” 

Giles Salmond, a partner of Eversheds Sutherland said:

“If Littlewoods is successful, billions of pounds of interest will be payable to taxpayers in relation to various historic claims.” 

HMRC has estimated it would have to pay out as much as £55bn if it lost all the legal battles it is fighting with taxpayers.

However, HMRC has calculated it will only have to to pay out on a fraction of these cases. The provisions it has made for tax disputes total £5.9bn.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

It's A Funny Old World! - HMRC Can Challenge Itself

I will leave this extract of an FT article here, and invite comments:

"A taxpayer has lost a £3.1m dispute after a judge said that HM Revenue & Customs could challenge tax calculations that relied on its own algorithms. The tribunal ruled that users of tax computation software could not rely on its results, even though its technical specifications had been provided by HMRC. The case involved a scheme that employed insurance policies to create a massive deduction that was used to reduce the taxpayer’s other tax liabilities. HMRC accepted that it reduced his income tax bill, but rejected his argument that it also reduced his capital gains tax (CGT) bill. 

The tax tribunal ruled that HMRC should not be stopped from making inquiries into aspects of tax returns that made use of information it provided. An adverse ruling would make HMRC “much more guarded about the assistance that it provides”, the judge said. “That could only be to the detriment of the majority of taxpayers who cannot afford to instruct professional advisers to complete their returns.”

It's a funny old world where HMRC can inquire into its own data/algorithms!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Penalties For Late Submissions of Foreign Customer Accounts

Law360UK reports that HMRC is insisting that financial institutions must hand over foreign customer account information to HMRC by the end of May, under international information reporting rules aimed at clamping down on tax evasion, or risk being hit with financial penalties.

Banks, building societies, insurance companies and investment houses have until May 31 to provide details about clients outside the UK which have financial accounts and investments in Britain under the first year for common reporting standards filing, or CRS.

HMRC has advised firms to check whether they need to register and submit a return and to make the submission before the deadline if so.

“Returns submitted after the deadline or the filing of an incorrect return may result in penalties being charged.” 

You have been warned!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Dodged a Cyber Bullet

My thanks to a loyal reader for posting this comment the other day, wrt the recent cyber attack that hit the NHS and other organisations:

"Ken the truth is that HMRC were very lucky to dodge the Wannacrypt bullet. When the attack took place last Friday the vast majority of their Windows kit was not patched against it including over 2/3 of the Windows 7 desktops and nearly all of the newer Windows 10 machines. Worse a lot of HMRCs Windows servers - some running national system - were also at risk. This included of support boxes running Windows Server 2003 (XP equivalent) and barely in support Windows Server 2008 machines
(Vista equivalent). 

The tech support teams have been frantically patching their machines all week and presumably will be continuing the exercise for days to come. If the attack had made it past the Departments external firewalls and email defences they would have been in serious trouble. The Malwaretech who activated the Wannacrypt kill switch by registering a domain name probably saved their bacon. That is not to say they will be safe in the future because HMRC also run a lot of software in the non Windows space which is also years out of support. The department is really a slow motion IT train wreck."

HMRC was lucky this time!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Probe Employee Expense Claims

The FT reports that the cost of tax relief on employees’ out-of-pocket expenses increased by a quarter to £800m in the five years to 2014-15.

Unsurprisingly HMRC is not at all happy about this, and said that it wanted to understand it better. It has asked for input from employers and others “to ensure the relief is being used in the way it was intended”.

Although HMRC claims it does not want to end the relief, you can be assured that something is coming!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Skynet Cyber Attack

I am somewhat surprised that yesterday's global Skynet cyber attack seems to have left HMRC unscathed!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Stephen Hardwick Leaves HMRC

 

My thanks to a loyal reader who posted a comment yesterday alerting me to the fact that Stephen Hardwick (Communications Director initially appointed on a temporary basis in 2011) has left HMRC.

His LinkedIn profile implies he has not yet found a new role:

Director of Corporate Communications

Company Name HM Revenue & Customs

Dates Employed Sep 2011 – May 2017

Employment Duration 5 yrs 9 mos

Location London, United Kingdom

I advised the Executive Committee and Board on communications and reputation in a Department with 65,000 staff and annual revenues of £537 billion from 49 million individuals and 5.4 million businesses. I was a member of the Executive Committee, a broadcast spokesperson and represented HMRC at cross-government forums.

I led 300 staff in media, social media, internal communications, marketing, design, stakeholder relations, corporate publications, sustainability, and HMRC’s Building our Future engagement programme. I managed a budget of up to £20 million a year and was HMRC’s environment champion.

Key achievements:

- repositioned HMRC as a transparent, confident and effective organisation, robustly handling controversies over customer service, tax avoidance by multinationals and international data leaks through proactive media and stakeholder engagement

- influenced senior leadership decision making, advising both on strategy and operations, to ensure the effective delivery of HMRC’s objectives, while protecting its reputation

- transformed HMRC’s approach to employee engagement, creating a compelling narrative and establishing a programme of leader-led face-to-face events. Since April 2014 we engaged 65,000 staff in 2,200 events to discuss HMRC's vision, and in November 2015 involved 1,600 managers to make simultaneous face-to-face announcements about our location strategy

- restructured communications, integrating the corporate centre and business lines, rationalising the structure, defining the scope of authority and accountabilities, and significantly reducing cost and headcount

- developed a campaigns-based integrated communications strategy, directly aligned to HMRC’s business priorities and objectives, covering all aspects of communications and engagement, with clear measurement and evaluation

- improved communications professionalism, pioneering communications evaluation and leading cross-government capability improvement projects.

His Twitter feed says he is "funemployed":

I've not yet got the hang of funemployment. Day 1 and I've just completed my 2016-17 Self Assessment tax return. I have a 60p refund due.

— Stephen Hardwick (@stevehardwick) May 8, 2017

Did he fall, or was he pushed?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

The Making Tax Digital Theatre

Standing room only for @MarkPurdueTax & @Garyeazico talk on the @HMRCgovuk #MakingTaxDigital pilot @Accountex #Accountex2017 pic.twitter.com/2MGa7GpOdm

— Tax Accounting UK (@TaxAccountingUK) May 11, 2017

A very popular show, it will run and run!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Football Is Flavour of The Month at HMRC

The Telegraph reports that the investigation into the tax affairs of professional football clubs by HMRC is scrutinising the basic salaries paid to academy scholars to decide whether they meet minimum wage regulations.

HMRC is understood to be investigating whether the number of hours a week that scholars spend training and playing games equates pro rata to the government minimum wage, set at £3.50 an hour for an apprentice.

Clearly football is flavour of the month at HMRC.

I assume HMRC "away days" to football clubs/games etc are now off the menu?

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Trouble In Hull

My thanks to a loyal reader who posted this comment the other day, warning about a possible "AO dump" in Hull:

"So, Gerry Dorby visited Cherry Court in Hull a week or two ago.

The first floor of the building holds the RIS section, and all ten or so teams were recently "re-structured" because, officially, Jenni Cooper had some problem with too many teams, but in reality it was done because A) She wanted to leave people doing something she'd ordered before taking maternity leave, and B) to split up people who were seen as talking too much.

When Dorby came, he noted that he wanted as many AOs "out the door" as soon as possible, adding that the floor was "far too noisy" still.

This was on a Friday when there were, apparently, very few people in.

He is also making it his mission to get production up - even though it already as high as it can be, I've been told..."

It is not clear as to whether the HMRC AO "dump" is redundancy or moving staff to the DWP.

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Adjudicator Backlog of Tax Cases

The Mail reports that the Adjudicator's Office, which rules on HMRC complaints, has a backlog of 1,028 cases. 

It settled just 970 in 2015-16 — half the 1,850 that were dealt with the year before.

The adjudicator said that while more than half of cases were dealt with in six months, and most within a year, 66 waited for more than a year. 

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

HMRC Online System Can't Cope

The Scotsman reports that HMRC’s own online tax calculator for self assessment is wrong, meaning people could be paying too much tax if they fall into certain income brackets.

Two groups of taxpayers are being overcharged if they file their tax returns online:

1 People who earn less than £16,000 a year – for example, from employment earnings, pension or rental income – and who exceed the Personal Savings Allowance, which is £1,000 a year for basic rate taxpayers and £500 a year for higher rate taxpayers.

2 Those who have total taxable income of between £27,000 and £32,000 a year, and who also receive enough income in the form of dividends to take them over the additional rate tax threshold of £150,000.

HMRC has admitted that its online systems are not able to cope with these two groups, and advises people who fall in these categories to file paper returns.

HMRC state that the problem won't be fixed this year.


Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"

Tribunal Quashes HMRC Fine

My thanks to a loyal reader for passing on this recent tribunal case, in which HMRC's £300 fine is quashed and HMRC come out of it looking like idiots.

FERGUS ANSTOCK Appellant 

- and - 

THE COMMISSIONERS FOR HER MAJESTY’S REVENUE & CUSTOMS Respondents

"The Notice relied upon by the respondents is so poorly thought through and so inadequately drafted that it fails the requirement of certainty and precision, which is a fundamental requirement ( as explained above ) .

In this context it is also worth pointing out that the requirements made of the recipient of a Notice must be discernible from within the four corners of the Notice itself unless some other document is specifically incorporated by reference.

It will not do for it to be argued, as it was argued before us, that some of the details about requested information might have been gleaned by looking at the earlier correspondence. That might be so; it might not be so. However, that is not a legitimate way to proceed because the Notice must be self - contained and must be construed to establish precisely what information and/or documents it properly requires the recipient to provide.

A taxpayer cannot be in breach of a Notice unless it is a valid notice. By “valid” we mean one which meets the requirements of certainty and precision, which we have discussed above.

For the two separate reasons that we have set out above , this appeal is allowed and the £300 penalty quashed."

'Nuff said!

Tax does have to be taxing.

Professional Cover Against the Threat of Costly TAX and VAT Investigations

Insurance to protect you against the cost of enquiry or dispute with HMRC is available from several sources including Solar Tax Investigation Insurance.

Ken Frost has negotiated a 10% discount on any polices that may suit your needs.

However, neither Ken Frost nor HMRCISSHITE either endorses or recommends their services.

What is Solar Tax Investigation Insurance?

Solar Tax Investigation Insurance is a tax-fee protection service that will pay up to £75,000 towards your accountant's fees in the event of an HM Revenue & Customs full enquiry or dispute.

To find out more, please use this link Solar Tax Investigation Insurance



HMRC Is Shite (www.hmrcisshite.com), also available via the domain www.hmrconline.com, is brought to you by www.kenfrost.com "The Living Brand"