July 7th, 2010
Initial figures suggest that around 74,000 UK tax residents claimed non-domicile status for the 2008/09 tax year of whom 4,600 UK claimed the remittance basis and paid the £30,000 Remittance Basis Charge; according to an answer to a parliamentary question.
Major changes to the UK taxation of so-called non-domiciliaries (non-doms) were introduced from April 2008. Many UK tax resident non-domiciled taxpayers want to know if they should pay tax on the arising basis (facing a UK tax bill on their worldwide income as it arises) or pay the £30,000 Remittance Basis Charge (RBC) and only be taxed on foreign income they bring into the UK in the year.
This is an extremely complex area. If you are UK tax resident but non-domiciled paying the RBC may be worthwhile if the following conditions apply to you:
- You have more than £2,000 of unremitted offshore income or gains;
- You have been UK tax resident for 7 of the preceding 9 years;
- You have offshore income of over £75,000 or offshore capital gains over £175,000 (which have not been remitted to the UK). [Figures based on current rates of tax for 2009/10].
If the above conditions relate to you, or you are the beneficiary of an offshore trust, a shareholder of an offshore company, are UK domiciled but ‘not ordinarily resident’ in the UK, or are unsure whether to pay the RBC then you need specialist tax advice.
Lynam Tax domicile specialists have decades of experience in dealing with tax residence and domicile issues.
Call Paul Lynam today for an initial free, confidential, no obligation, discussion: 0845 643 9997
July 1st, 2010
HMRC have published a briefing note explaining the newly introduced Overpayment Relief; which replaced Error or Mistake Relief from 1st April 2010.
Overpayment Relief applies to errors and mistakes made by taxpayers in their Tax Returns for income tax, capital gains tax and corporation tax. Claims for Overpayment Relief must be made within four years of the end of the Income Tax year or Corporation Tax accounting period to which the claim relates. Different (transitional) time limits apply for mistakes in individuals’ Self Assessment Tax Returns for 2004/05 or 2005/06 filed within 12 months of the end of the relevant tax year. The time limits are then 31 January 2011 and 31 January 2012 respectively.
I’ve made an error in a Tax Return and want to claim tax back: can I?
If your Overpayment Relief claim is straightforward you should have little problem getting your tax back. However, many tax officers seem to feel they have to refuse every possible claim; sometimes on the most tenuous grounds. It can take resilience, determination and skill to succeed. If you feel daunted by the tax rules and think a tax officer is treating you unfairly then it may be down to his ignorance, lack of training or simple misunderstanding of very complicated rules. Experienced tax advisers like Lynam Tax experts can help the tax inspector understand the law. Frequently this will help your claim succeed and get your tax back.
If you’re subject to a worrying Tax Enquiry or Inspection or you think you have over-declared your income or gains and need to make an Overpayment Claim: you can discuss this with one of our sympathetic, experienced experts.
For a free, private, no obligation consultation, call Paul Lynam today on 0845 643 9997
July 1st, 2010
A London accountant has been sentenced to 8 years in prison for stealing £11m in Income Tax and Value Added Tax: by falsifying his clients’ and his own tax returns.
Christos Charalambous (58) of Palmers Green, filed Self Assessment tax returns for clients. These included fictitious expenses claims, which increased the tax repayments due. The total repayments claimed by the fraudster for his clients was £11,222,472. He also understated client fee income on his own tax returns by £807,000, and failed to declare and pay £180,082 VAT. His accountancy firm, Charltons, received the clients’ repayments from HMRC, deducted a minimum 15% fee, and then paid the remainder to the clients.
He was found guilty on six counts of cheating the public purse at Blackfriars Crown Court, following a 7 week criminal trial, and is now in prison. A Confiscation Order is being pursued.
Lynam Tax Investigation Experts have a vast amount of practical experience in managing serious tax fraud investigations. If you are worried about a tax investigation we can advise you on the best course of action. If appropriate, we can help you manage any necessary disclosures. If you are facing criminal charges we can help you obtain first class legal representation, in order to obtain the optimum outcome for you, your business and your family.
For a free, private, no obligation consultation, call Paul Lynam today on 0845 643 9997
May 21st, 2010
The FT reported today that the new coalition government intends “to review the taxation of non-domiciled individuals” - yet again, creating further uncertainty in this already over-complicated area of UK tax.
Potential changes include scrapping the seven year period of grace; which mainly benefits in-bound professionals on short term contracts (e.g. doctors).
The changes in April 2008 shifted the tectonic plates of taxation for non-domiciliaries. The new rules are mind-bendingly complicated, even for seasoned tax specialists. Further changes can only lead to more confusion and more potential for non-doms to maket mistakes in their tax returns – posibly leading to a costly and intrusive tax enquiry.
How can Lynam Tax specialists help me?
If you are tax resident but non-domiciled in the UK you may well need specialist help. Lynam Tax specialise in this particularly complex area of tax law.
For a free and no obligation, private consultation, call Paul Lynam today: on 0845 643 9997
May 15th, 2010
If you are unhappy about the way the taxman is treating you then you can complain to the Official Adjudicator or to the Ombudsman. Both have issued ‘school reports’ on HMRC for the year ended 31st March 2009. Many complaints are to do with how HMRC handled a Tax Enquiry or a Compliance Check. So how well (or badly) did the taxman behave?
So: did the Adjudicator give the taxman a gold star?
Far from it! The Adjudicator took on 2,092 complaints about HMRC in 2008/09. HMRC effectively lost two thirds of all cases. To compound matters the Adjudicator had a backlog of over 2,000 complaints against the taxman, waiting to be settled, and you can expect to wait a year for a conclusion from the Adjudicator. Cynics suggest this is because HMRC provide the staff! And there is no effective way to complain about delays by the Adjudicator!
A main area for complaint was the failure by tax officers to correctly apply a concession for writing off tax arrears where HMRC has been slow to use information.
Was the Ombudsman more impressed?
Not at all. There were 2,159 complaints about HMRC to the ombudsman during the year. 113 older cases relating to HMRC were also concluded. The Ombudsman tries to sort out complaints in a quick informal way, only a minority of cases are dealt with by an in-depth investigation. In 2008/09 only 24 HMRC complaints were fully investigated. Given that these are the cases that got through the other complaints’ processes, a staggering 40% of these were fully or partly upheld! It is not reported how many of the 2,000+ informal settlements found against the taxman. Frustratingly, over a quarter of cases take more than a year.
In one case the taxman was criticised for being ‘self-serving and mean-spirited’ and pursuing the taxpayer ‘with a reckless disregard for his rights’. The taxpayer suffered severe detriment and the Ombudsman recommended a compensation payment of £50,000. It can pay to complain.
Should I complain about HMRC?
The time and effort needed firstly to get through HMRC’s own complaints procedure means that only a resilient taxpayer is likely to take their case all the way. It has to be said that pursuing a complaint against HMRC can be a soul-destroying task. But where taxpayers feel ground down by the inflexible state machinery and the jobs-worth mentality of bureaucrats there is at least a remedy of sorts. Bear in mind that before complaints reach these bodies you first have to approach the inspector’s line manager. You can then go ‘off-line’ for so-called ‘Internal Review’. You can then start the formal complaints procedure; involving another HMRC official. You can ask your MP for informal help (which can be very successful). Only then if you are still frustrated do you need to approach the Adjudicator/Ombudsman. Yet their reports show that even after HMRC have carried out their own reviews at three levels (at least) they still make serious mistakes in over 1,000 cases – each and every year!
Do I Need Professional Help?
Where substantial sums are involved (or may be due in compensation) then it can be very worthwhile employing professionals experienced in finding their way through the bureaucratic maze.
Lynam Tax Dispute Experts have decades of experience in sorting out contentious issues with the taxman.
For a free and totally confidential initial discussion call Paul Lynam now on: 0845 643 9997.
NB. Lynam Tax does not deal with working family tax credit issues.
April 6th, 2010
HMRC has made a major change in debt collected practice in appeal cases. In direct tax cases, when a taxpayer appeals to the Tax Tribunal against an assessment or closure notice, HMRC used to postpone the payment of the disputed tax pending the outcome of the litigation.
If the Tax Tribunal decides the case in HMRC’s favour, the law entitles the taxman to collect the disputed tax at that point – even if the taxpayer is pursuing an appeal to the Upper Tribunal or the higher Courts. In practice HMRC have not enforced collection until all rights of appeal have been exhausted. From 1st April the taxman will normally want the tax paid following a win at the Tax Tribunal or a Higher Court. If it ultimately loses the case, HMRC will then refund the tax. This puts Income Tax, Capital Gains Tax and Corporate Tax on the same footing as the more aggressive VAT, where the general rule was always that the VAT has to be paid upfront except in cases of hardship. Nevertheless, the ability to postpone tax pending a hearing by the Tribunal, still puts the taxpayer in a fairly advantageous position in terms of litigating direct tax cases.
Do I need specialist help with my tax appeal?
The Tax Tribunal is an independent body which adjudicates in disputes with HMRC. Taking an appeal to the Tax Tribunal can be a highly effective way of resolving disputes with HMRC. However, the taxman uses specialist ‘Appeals’ teams to lead its cases at Tribunal.
Lynam Tax Dispute Experts have decades of experience in handling contentious tax appeals and can assist taxpayers and their accountants with the process; in order to achieve the optimum results.
If you need help with a difficult tax dispute or a contentious tax appeal call Paul Lynam now for a confidential and no obligation discussion on: 0845 643 9997.
April 1st, 2010
The taxman is now allowed to override confidentiality to name and shame tax evaders. From 1st April 2010 it’s no joke for anyone the taxman thinks has a tax fraud of more than £25,000. The tax office will publish names and “sufficient further information” to allow tax fiddlers to be identified, if an individual or company director has not made a full disclosure to HMRC (e.g. prompted disclosures under the HMRC Code of Practice 9, Civil Investigation of Fraud procedures).
This punishment by public humiliation is on top of potential 100% penalties for “deliberate understatement”. There’s a further 100% maximum penalty (i.e. an eye watering 200%), where an offshore bank account is involved.
The details published will be the “minimum necessary” to identify the person and the offence: e.g. name, address, nature of business, period covered, amount of tax and penalty. The taxman will put the Tax Offenders Register on the HMRC website and issue a press release.
How could it affect me?
Major worries to any business proprietor “named and shamed” on the tax offenders register include the potential for: credit refusal from lenders and suppliers; loss of customers’ goodwill; refusal by customers to pay in advance or leave deposits; a negative impact on the valuation of the business. The impact on families could also be extremely stressful.
What safeguards will there be?
- The decisions which underpin the scheme can be appealed to the independent Tax Tribunal. If the Tribunalfeels there is no evaded tax, or that the understatement was not deliberate, then the taxman cannot use ‘Naming and Shaming’;
- Publication is not allowed until all appeal opportunities are finalised;
- The taxpayer must be notified and given reasonable opportunity to make representations;
- The taxpayer will be sent an advance copy of the details HMRC intend to publish;
- HMRC must publish within 12 months of the penalty becoming final and remove material 12 months later;
- HMRC will not publish your address if you can be identified without it and without potential for you to be confused for another person.
- HMRC will not publish at all in certain exceptional circumstances, after taking into account representations by the taxpayer.
How can Lynam Tax Enquiry Experts help me?
If you are undergoing a tax investigation or a compliance check then specialist help from Lynam Tax Enquiry Experts could save your blushes and your business. Plus, our massive experience will almost certainly save you tax and penalties as well.
*For a free, confidential chat about your tax affairs, don’t delay, call Paul Lynam now on 0845 643 9997.
March 10th, 2010
The Tax Health Plan (THP) is a Tax Amnesty for the medical profession only. What are the key points?
- HMRC’s campaign is underpinned by information obtained from NHS Trusts, private hospitals, medical insurers etc;
- Medics must notify their “Intention to make a Disclosure” to the tax authorities by 31st March 2010;
- A full disclosure must be made to HMRC in writing by 30th June 2010;
- Any additional tax, interest and penalties must be paid by 30th June 2010;
- Disclosures will normally carry a (low) fixed 10% penalty (but there are no penalties where innocent errors have been made);
- The disclosure may have to cover up to a maximum of 20 years;
- Medical professionals will be unable to use any future disclosure facilities which may be offered by HMRC, but could use the current Liechtenstein Disclosure Facility. Importantly, the LDF is not limited to people with existing financial connections to Liechtenstein;
- After 31st March 2010 HMRC will begin using the information it has obtained to commence investigations;
- All disclosures under the THP will be treated in confidence; the GMC/GDC will not be notified by HMRC;
- The taxman will review disclosures after 30th June 2010 for accuracy and completeness. If the disclosure is accepted, HMRC will write to confirm this;
- Medical professionals subsequently found to have undisclosed tax liabilities and who chose not to make a disclosure via the THP can expect penalties of up to 200% and run the risk of criminal prosecution.
How can a Tax Enquiry Specialist help me?
The various tax amnesty processes are straightforward in simple cases. But there are many hazards for the unwary or those with more complex tax affairs. Badly handled Disclosures can have a negative effect; leading to higher penalties; a Civil Investigation of Fraud enquiry; or in extreme cases, prosecution.
Your usual accountant may be able to help. But sometimes a specialist consultant is required, rather than a general practitioner. Lynam Tax Enquiry Experts have vast experience of handling tax enquiries and disclosures to the taxman. In fact it’s all we do – because we are deep specialists.
For a free, no obligation, private consultation, don’t delay, call Paul Lynam today: on 0845 643 9997
February 3rd, 2010
The taxman has launched a groundbreaking tax amnesty initiative specifically targeted at medical and dental professionals, including Dentists, General Practitioners, Hospital Doctors, Surgeons and Consultants. The THP presents medical and dental professionals with a unique opportunity to make good any undeclared tax with only a 10% penalty. The programme will run from 11th January 2010 to 30th June 2010. To benefit from the advantageous terms of the THP, medical and dental professionals have to make a full disclosure of all under declared income and pay along with interest and a 10% penalty by 30th June 2010.
Why are Doctors and Dentists being singled out?
HMRC have used their extensive information powers to obtain data from a number of third parties, including NHS Trusts, insurance companies, private hospitals and pharmaceutical companies
What if I don’t disclose?
From April 2010 onwards, HMRC will carry out tax investigations aimed at medical and dental professionals who have not come forward, using their information. Failure to disclose tax irregularities could result in a tax enquiry. These can be time consuming and intrusive. Penalties can be up to100% of the tax evaded. The tax office can now also publically ‘name and shame’ individuals who decide not to participate in the THP. In some cases, HMRC may prosecute.
Key features of the THP:
- It is only open to medical and dental professionals, and specifically those regulated by the General Dental Council or General Medical Council and in possession of GDC or GMC Registration Numbers;
- To benefit from the favourable terms, individuals must make a full disclosure of all undeclared tax liabilities;
- Tax is due up to twenty years back;
- Registration of an intention to disclose under the THP must be made by 31st March 2010.
- Full payment of the tax, interest and penalties must be made by 30th June 2010;
- The penalty will be fixed at 10% of the unpaid tax;
- No penalty will be applied where the total of the unpaid taxes is less than £1,000, or in cases of innocent error, where the back tax may be limited to 6 and even as short as 4 years;
- Doctors and Dentists who make a full disclosure under the THP will not be publically ‘named’ and ‘shamed’;
- Where unpaid tax is linked to an offshore bank account, the 10% penalty arrangement may not be available;
- The taxman says no further opportunities will be given to dental or medical professionals to benefit from other tax amnesties;
- After 31st March 2010, HMRC will commence investigations based on the information they have obtained. If extra tax is due, the penalties will be much higher than the 10% on offer under the THP, and could be up to 200%. They are unlikely to be less than 30%;
- HMRC has not given any guarantee that a taxpayer will not be prosecuted. However, as long as the subject of the disclosure does not include the proceeds of serious organised crime, it is unlikely that HMRC would consider prosecution;
- An individual can make a disclosure under the Civil Investigation of Fraud (CIF) procedure. If CIF is offered to someone it comes with a guarantee of immunity from prosecution if the disclosure is correct and complete. The THP is not available to someone who discloses under the CIF procedure.
Do I need to consult a specialist?
The various tax amnesty processes are straightforward in simple cases. But there are many hazards for the unwary or those with more complex tax affairs. Badly handled Disclosures can have a negative effect; leading to higher penalties; a Civil Investigation of Fraud enquiry; naming and shaming; or in extreme cases, prosecution. Your usual accountant may be able to help. But sometimes a specialist consultant is required, rather than a general practitioner. Lynam Tax Enquiry Experts have vast experience of handling tax enquiries and disclosures to the taxman. In fact it’s all we do – because we are deep specialists.
For a free, no obligation, private consultation, don’t delay, call Paul Lynam today: on 0845 643 9997
January 10th, 2010
HMRC issued a press release today launching a wholly new concept in UK tax compliance – an incentivised disclosure initiative aimed at a particular sector: in this case members of the medical and dentist professions.
The taxman said: “Medical professionals are being encouraged under a new Tax Health Plan to tell HM Revenue & Customs (HMRC) if they have understated income. Those who contact HMRC by 31 March 2010 to make a voluntary disclosure will be able to put their tax affairs in order simply and on the best available terms. After that date, using information it holds about how much is paid to them, HMRC will carry out targeted investigations aimed at medical professionals who have not come forward. Substantial penalties of up to 100% of the tax due or even criminal prosecution could follow for those who have undeclared tax liabilities.”
The Health Plan (THP) is the first initiative in a new HMRC tax amnesty campaign focused on professionals. They aim to make it easier for taxpayers to put their tax affairs right.
HMRC’s Director of Risk and Intelligence said: “Our aim is to make it as easy as possible for people to come forward, make a full disclosure and benefit from the certainty of a reduced 10% penalty that HMRC is making available to those who qualify for this opportunity. The message is clear: contact us before we contact you.”
The Health Plan will operate in two stages. From 11th January to 31st March 2010, medical professionals can register their intention to make a voluntary disclosure with HMRC. By 30th June, those who have registered must have made their disclosure as well as arrangements to pay all tax interest and penalties due.
The various tax amnesty processes are straightforward in simple cases. But there are many pitfalls for the unwary or those with more complex tax affairs. Badly managed Disclosures can have the reverse effect; leading to higher penalties; a Civil Investigation of Fraud enquiry; or even prosecution.
Your usual accountant may be able to help: but sometimes a specialist consultant is required rather than a general practitioner. Lynam Tax Enquiry Experts have vast experience of handling disclosures to the taxman and tax enquiries. In fact it’s all we do – because we are deep specialists.
For a free, private, no obligation consultation, don’t delay, call Paul Lynam today: on 0845 643 9997
