dtl

https://www.remunerationtrustsettlement.co.uk/hmrc-settlement-services/

All the people I know were in EBT's, sorry but I don't know the providers. .

If it is BWs RT scheme that your friend is using then this seems concerning. I linked to you HMRC spotlight 51 associated with RT schemes. The spotlight states that HMRC do not accept RTs are legal and they are coming after them. The spotlight is there to warn current users and potential users of this. I struggle to understand why anyone would enter into such a scheme. Implicit to this is that there will be no sympathy from HMRC when it comes to interest and penalties on tax due. I also posted an article detailing search warrants and subsequent police raid issued against BWs RT scheme. It took decades for HMRC to finally put a nail in the coffin of EBTs. The original approach by HMRC with EBTs was a case by case basis with an attempt to establish case history. The method that finally worked for HMRC was the fairly recent introduction of APNs and changing the law. So whilst the RT schemes might have not catastrophically failed yet, HMRC will keep coming after them until they do. From the start HMRC did not accept that EBTs were legal. However, so convincing was the salesman's patter about QC approval and so eager were users to take home 85% that the the majority of users actually believed (or chose to believe) an EBT was HMRC approved.....even though for years they added a DOTAS number to their tax return. I suggest you friend asks a simple question on the HMRC enquires forum of the UK contractors forum. There are tax specialists posting on the site who will give a mostly unbiased opinion for no cost. Although, I have a feeling he will not post this question; since another trick the scheme suppliers use is to the tell the users not to discuss the scheme details with advisors or specialists outwith their sphere of control. This means in reality they only discuss it with their friends and colleagues; that your taking home 85% (paying zero tax), and yes it is bulletproof and HMRC approved.......and thus someone else falls in the hole. I know all of this because I have had these conversations with multiple people over the course of many years......all of them now ruing the day they ever became involved. If your friend is relying only on opinion from the scheme supplier/s, then for obvious reason this would seem very unwise.

And like the rest of the providers of these schemes the guy might be a bit of a snake. A lot of the EBT providers left the schemes users high and dry. Whilst business was good and they were extracting a healthy 15% from the people using the scheme it was all reassurances about how the scheme is QC approved, nothing to worry about, if HMRC give you any problem will will mobilise our team of specialists and defend you, HMRC is basically scared of us etc, etc. When it all went wrong, most of the scheme providers just closed shop and the people who were in the schemes who tried to call them were met by disconnected phone lines, there was no defence, many users were hung out to dry. After closing his EBT scheme Baxendale walker seems to have gone to immediately set up an alternative RT scheme which he claims is bulletproof as it contains some kind of magic that circumvents all the legislation, haha. The scheme is already in trouble, reference the HMRC spotlight I previously linked to. This article I also linked to also shows it would be fully mental to be a user of this scheme; https://www.rossmartin.co.uk/sme-tax-news/4804-re-branding-loan-scheme-is-a-criminal-offences Once HMRC are on it, they wont stop.

The trouble is that some people only hear what they want to hear, in this instance they only heard "take home 85% of pay". The remaining 15% is snuffled by the scheme supplier so you effectively pay zero tax. The tortuously complex arrangements used tax rules that are individually acceptable, but were then woven into a complex arrangement using the individual tax rules in manner that was never intended for them. And they wanted to believe the salesmen when they were told that the complex scheme was tax QC approved.......a scheme that means you effectively pay zero tax, haha. Some users of the schemes actually believed that the QC approval meant these schemes were HMRC approved, haha. Initially people planned to set this money aside just in case, however as the schemes ran for years people become more confident and the saved money got spent. These folks were perhaps greedy and stupid. However, their punishment was possibly a bit harsh. They are down the 15% they paid to the scheme supplier. Plus they now have to pay back all the tax they should have paid, interest on up to ten years of underpaid tax and penalties. A breathtakingly painful punishment.

The celebrities will have to pay up just like everyone else. Loss of life for something like this is a terrible thing, likewise all the stress and suffering caused, which for many has lasted for nearly four years. However, generally there is not a lot of societal sympathy for people who evade taxes. Anyone who uses a scheme like this going forward is a muppet. The line has been clearly drawn in the sand by HMRC and a small amount of research would show this. I have a lot of sympathy for people who entered into these schemes pre-2016, many of them were just a bit naive and were too trustworthy of the scheme providers sales spiel.

The UK contractor forum link I provided earlier gives a good background of what is going on. As I mentioned previously prior to 2017 (ish) HMRC used to have to take you to court to get tax owed from these type of remuneration schemes. This was a slow process and did not yield great results for HMRC. However, after the law was changed in 2017 (ish), this is no longer necessary HMRC just essentially send out a tax demand c/w penalties and interest and the machinery of law just takes over. Besides which if you are going to a tax tribunal for this sort of thing you best take an experienced tax barrister. However, the problem is that they cost about £10k a day. They will probably want several days to prepare for the case, so you are looking at tens of thousands of pounds just to go to court, and lose. There are groups of people that have got together and are trying to share the cost in taking this to court, but this has generally yielded nothing. The law states what they did is illegal, there is nothing really to contest. There is no point is trying to claim the scheme is legal since a law has been passed by parliament that states that the scheme is illegal. The only way out is not to have been in the scheme, he only way this changes is if the law changes.

So there was a government review of the loan charge law at the start of the year, one outcome was that for many people the look back period for loan scheme reduced down from 20 to 10 years, but only for the loan charge. This was a godsend for some, however it still remains truly still really awful for others. Don't kid yourself HMRC wont come for all the money, people are losing their homes and apparently seven people have taken their own lives because of this; https://www.buzzfeed.com/emilyashton/loan-charge-suicides-hmrc

What like the ZERO concerns like all the people who were in EBTs for years had, and now face life changing tax bills. These people need to stop listening to the scheme providers, and take some professional advice. The man on the street is too impressed when the scheme provider states "we have had an eminent tax QC review the scheme and it is 100% HMRC compliant".........nope. Apart from anything else HMRC have explicitly stated that they believe that the RT scheme does not work, via spotlight 51, and they state they will come after the users; https://www.gov.uk/guidance/remuneration-trust-tax-avoidance-using-loans-or-fiduciary-receipts-spotlight-51

Hmm, I think maybe there were some people who were issued Advance Payment Notifications (APNs) by HMRC, in respct of loan schemes, in an incorrect manner, in this situation there have been refunds from HMRC. But even then HMRC have come back for the money again, in a correct manner. The loan charge still stands and a lot of people are still in a mess, look at the recent posts on this forum; https://www.contractoruk.com/forums/hmrc-scheme-enquiries/ Unless i am missing something?

Ahh sorry too many mails..... I found out that there is a HMRC spotlight on this already; https://www.gov.uk/guidance/remuneration-trust-tax-avoidance-using-loans-or-fiduciary-receipts-spotlight-51

If you are really interested post a question on UK Contractors forum, there is a sub forum that deals with these matters and there are tax specialists and advisors posting; https://www.contractoruk.com/forums/hmrc-scheme-enquiries/

In the wake of the loan charge some of the very companies that had got people into a big mess in the first instance re-branded themselves and offered apparently watertight solutions to the loan charge. It seems ultimately these will also fail, in the eyes of HMRC they have failed already.

Cant find a lot about them, but it seems he might have tried to re-badge illegal loan agreement as something else and claim that they worked/met the requirements of the law. https://www.rossmartin.co.uk/sme-tax-news/4804-re-branding-loan-scheme-is-a-criminal-offences

The way I understand it; The whole appeals and tax tribunal thing, and any attempt to defend yourself was pre-2017 (ish). Prior to this point in time it was one legal view versus another legal view played out rather expensively a court. After the government changed the law in 2017 (ish) there are no grounds for appeal, HMRC automatically wins, ie the law is the law.

He was the QC who advised Rangers on their EBT arrangements, looks like he is bankrupt now; https://www.ftadviser.com/your-industry/2020/03/19/bankrupt-liable-for-16m-tax-advice-hid-assets/

In short it was a change in the law that spelt out the end of disguised remuneration tax avoidance, mostly used by high earners using Employment Benefit Trusts. Remember the Jimmy Carr thing, at the time he voluntary left the scheme due to public opinion, ie no tax avoidance committed. Prior to 2016 it seemed that these schemes were legal, it little bit out of the ordinary and a bit risky, but highly skilled tax QC's basically said you were OK using them. In 2016 the wheels started to come off and by 2018 the wheels had fully fallen off, HMRC and the government changed the law. What was a bit harsh was that the law changed not only going forward, bit the law also changed retrospectively making it law that the schemes had never been legal, for at least 10 years prior. It gives a taste of what the HMRC can and will do.

I know several people who have had to pay loan charges. One person I know had to re-mortgage his family home to pay a £300K bill. There have also been several documented cases of loan charge related suicides so onerous has the bill and associated fines been.

It is nothing to do with them not being bothered and more to to do with who they can easily catch. I suspect most landlords not declaring income from rentals will be easily caught, 90% plus. The truth is most people who underpay tax are bad at it and get caught. Whilst one might be getting away with it now, in the future it will become increasingly hard and then when one gets caught you are also probably on the line for all the earlier years. As an earlier poster has already pointed out the inland revenue can easily investigate you 20 years into the past. The vast majority of landlords have left a trail of electronic fingerprints, if the inland revenues system has not already identified them it probably soon will. Gone are the days where a tax inspector had to trawl through records/databases etc to understand a individuals tax liability. Nowadays it is all electronic. The HMRC Connect system expands its reach further every year. For example when someone receives a letter from the inland revenue telling them that they should have submitted a tax return, telling them that this has now cost them £x in fines and will cost them £y a month in further fines until the tax return is received, there has been no human involvement from HMRC at this point, it is all computerised. A human tax inspector from HMRC only gets involved at the later stages when the taxpayer is really pushing his luck. There is a lot of rubbish talked about avoiding taxes, mostly by people who are currently not correctly paying them. It works until it doesn't work anymore and then often it is a complete financial catastrophe. I have seen this play out multiple times.

I have multiple colleagues who got caught up in tax avoidance schemes. I also have had several colleagues who for one reason or another have fallen the wrong side of HMRC with respect to undeclaring income. So I have seen this sort of thing play out several times now. The way I see it is; Tax inspectors initially have will have little to no role in how this will play out for landlords and hence it has nothing to do with how busy tax inspectors are, or are not. By the time the tax inspector comes knocking it is too late and a landlord will be regretting their actions. The inland revenue system already knows who should have completed a tax return with respect to earnings from UK property rental, they also know who then probably owes tax on this income. Apart from anything else the inland revenue has a 100 million pound computer system that is designed to autonomously gather this sort of information from the multiple databases the system has access to. What happens next is someone at the inland revenue presses a button and tens of thousands of letters get sent out alerting these people that they should have completed a tax return. This will be the last chance to comply. If they then fail to file a tax return, or fill in the tax return incorrectly they have committed tax fraud/evasion. There is no defence of; “oops I forgot”, “I did not understand” etc, etc. This has played out thousands of times before, there is nothing new to be tried here. By law the responsibility of correctly reporting income sits with the taxpayer, 100%. The tax inspector becomes involved when there is still no completed tax return or the returned tax return is not correct, and tax fraud has now been committed. Ultimately tax fraud can result in a jail sentence dependent on how far the landlord decides to push his luck at this point. However, more likely in the situation when the tax inspector appears and the landlord finally takes advice from an accountant or solicitor they will now decide to sensibly comply and Jail is avoided. What does result is fines and interest payments which will probably be at least double the amount of tax that was due.

I notice that there are a lot of properties available to rent in edinburgh city centre, on rightmove. Does any know how to obtain historical figures for this?

One of The Motley Fool Discussions Forums; Property market and trends: http://boards.fool.co.uk/Messages.asp?bid=51402

I have attached a recent post from another discussion forum, posted at the begining of this week, regarding the Aberdeen property market. It is a good read: "Woke up today to a lovely splattering of snow outside - hmmm, not even Halloween and I'm peeing icicles. I'm constantly amazed that my lovely wife and other friends appear genuinely worried about global warming - fair enough if we lived ever so slightly closer to the equator, but here? It seems analogous to telling Harry Redknapp to slow down with the wins at Spurs or they'll have to deal with the pressures of going for 10 European Cups in a row. And all we hear about is the negative aspect of global warming. Polar bears are evil twats, who cares if they are made extinct? Ever since they sold out to Coca Cola I lost all respect for them. And what about all the animals who thrive in hot temperatures? Camels, snakes, swimsuit models etc - are we supposed to forget about THEIR wants and needs? Anyway, I digress. It's bloody cold, and a similar chill wind appears to be blowing around the local property market, going by the figures released a couple of weeks ago by the local property oligarchs at aspc http://www.aspc.co.uk/Info/page_90.html If you look at 3rd quarter stats they are admitting to an 8% decrease on the previous quarter; curiously this juggernaut of a fact was well hidden away in the local rag - presumably it doesn't fit well with the 'lifestyle' section or more importantly the many thousands of pounds the publication receives weekly in property advertising revenue. Perhaps more telling though is the graph on fig.4 (page 3) which shows that sales have slumped around 50% on the same quarter last year - from around 2124 last year to 1130 this time around. It is the worst 3rd quarter on their records and the worst absolute figure since 4th quarter 2001. I confidently expect this quarter's figure to smash through the glass floor and descend into unchartered territory - sub 1000. In fact it'll be lucky to break 800 if the trend continues. And this, in the oil capital of Europe, with $100+ a barrel. Well well well - looks like we're not immune after all. Two quick anecdotes while I'm on - firstly, a source that I trust has told me this afternoon that a local housing association has just bought the last dozen or so flats from a local town centre development - Citigait, by Barratt. They were being punted off to gullible fools for around £250k for a two bed flat right by the railway line and half a mile from the 'Torry Hilton' a.k.a. the local jail. Apparently the H.A. was able to secure a not-too-shabby discount for taking the last 'executive dwellings' from their willing hands - just over £100k a unit. Still. It's only 40%, eh? I'm sure the neighbours will have no problems getting their quarter mill back when they put their flat on the market, complete with a diverse set of new neighbours - the single parent, the drug addict, the recently released from prison - you know the type (Actually I'm being unkind, I have no idea whatsover who will be housed in them - but I think it's safe to say it won't be the type of person who can afford a £250k flat). I stress that this has not been released as solid facts yet but should be within the next week or so. Secondly - a gym buddy of my wife's has just got a nice little deal on a new build too. Apparently they went to view showhomes in Inverurie but they were a little on the pricey side, so decided to settle for Laurencekirk instead. Out of the blue they received a call from the Wimpey development in Inverurie looking to cut them a deal. "Too late" says the hubby, "we've just put down £5k non-refundable deposit on a house in Laurencekirk". The upshot was that a 'senior sales figure' called the husband back about half an hour later, and offered him the house they had originally wanted for the price they had agreed for the 'lesser' house. So - from £365k to £285k. And on top of that, five grand cashback on completion to return their lost deposit. You know - I used to think that housebuilders were really stingy, nasty people. I bought my last two places new and had a hell of a job chasing up snags and the like, it was fairly annoying. But punters still queued out the doors so even a free carpet was a no-no. It turns out I've got them all wrong, they're actually a hugely benevolent bunch of guys who have simply not been in the right environment to display their amazing generosity. Whether it's over a million to a housing association or a mere 80k to a humble wage slave, it looks like Santa is beginning to appear nice and early this year. I'll tell you where he can stick his snow though. "

I have had the misfortune to have lived for many years in Aberdeen and unfortunately I still spend some time there. As far as I and many others are concerned, Aberdeen is a dump. In my experience the only people who are actually fond of Aberdeen are the people who where born and bred there. Aberdeen is basically an offshore waiting room for the offshore industry. Hence, a large percentage of people Aberdeen work in jobs associated with the oil industry, the city is a one horse town with no culture or "vibe". Most bars are filled with men, what few local women there are look like donkeys and have the personality of a house brick, however for some reason they think that they are gorgous....I guess its a supply and demand thing. What's with the attitude in Aberdeen........ extremely arrogant, hostile and rude. I can understand arrogance when its based on something............but get real you're from Aberdeen......... The architecture of the city itself is Ugly: it is grey, grey, grey. The interior of the period houses and flats are cramped and dark, when compared to the Georgian townhouses of Edinburgh and Glasgow. The weather is grim, it pokes out into the North sea so there is always that wind blasting its way off the North Sea. The only thing Aberdeen has going for it is its closeness to the Cairngorms. To compare Aberdeen with Edinburgh or Glasgow on any level, is a joke. To spend a night out in Edinburgh or Glasgow is a real pleasure. A night out in Aberdeen is depressing.

People that think that Aberdeen is going to somehow escape any downturn in the market are totally missing the point. I agree that folks in Aberdeen generally do pretty well for themselves, courtesy of the oil industry. However, many of the people in Aberdeen are in a similar situation to many other people across the UK....... financially overstretched. The fact that many so people are overstretched stems from the fallacy that property is a one way bet, and your house is going to increase in value by at least 10% a year. This then allows you not to worry about saving for the boring things; your pension, some money for a rainy day etc. The logic seems to have been that as long as you have property then money is for spending on the fun stuff. Hence, with the the current problems with interbank lending and the end of the securitization model the housing market is going to decline, starting with the new build buy to lets. Of course if the well paid people in Aberdeen have been stashing money away in the bank, rather than spending it, then this may be avoided.............. I know a couple of guys in Aberdeen on 130K plus, who have nothing left in the bank at the end of the month......however they do have fairly recently aquired BTL portfoliios.