Saving tax for clients has always been a major objective for many accountants and other trusted advisors. And, for many years, accountants and other advisors introduced their clients to a tax scheme promoter who sold various structures both offshore and onshore.
Clampdown on tax schemes by HMRC
HMRC have been investigating and clamping down on tax avoidance schemes over the years and many advisors are finding that just when you need the tax scheme promoter’s help the most, they have disappeared and left you and your clients high and dry. Does this sound familiar?
Clients can be very demanding. It’s hard enough in business to get a client let alone service all their needs. You do your best to help them and then it can start going askew. In many cases the client will blame you and not the tax scheme promoter for the hassle and worry they now have when HMRC begin to investigate your client’s participation in the scheme.
Its all about saving tax
Saving tax is a key driver for most taxpayers. But, understanding how a particular structure works can be challenging, both for advisors and clients. So, when HMRC come knocking at the door (metaphorically speaking) many advisors and clients don’t know the best way to respond.
HMRC can get quite agitated though when they come across certain names in the tax avoidance world, particularly those who are based offshore and those who have decided to pack up, never to be seen or heard of again. Your client still has that structure. The structure you didn’t quite understand but it was sold to your client on the basis that it would save them a lot of tax. Well it did on paper, at least.
Playing ping pong with HMRC
After a few rounds of correspondence with HMRC, more and more information and documentation has been passed across. But this has become less so particularly after the Schedule 36 Information Notice – remember the one that took forever to respond to, and the client wasn’t impressed by its cost.
And then the assessments started to arrive. Yes, you can appeal and postpone the amounts being demanded providing you have good grounds, but if you didn’t quite understand the structure, appealing becomes difficult. Although the tax scheme promoter was there to help with the response. That is until they decided to pack up, never to be heard of again.
Fighting a rear-guard battle with HMRC
So now you are on your own. Fighting a rear-guard battle with HMRC and trying to keep your client on board. As if you didn’t have enough spinning plates in the air with all your other clients!
How to conclude matters with HMRC
What can be done to conclude matters with HMRC? Or, rather what needs to be done?
Being closely involved in any client matter is a big drain on your time that you may never get paid. Sometimes it can be hard to see the wood for the trees especially when you are outside your comfort zone. Is it time to face up to the fact that it’s a mess and perhaps the structure will never achieve what it set out to do?
There is light at the end of the tunnel and a way to conclude these complex “arrangements” and their structures. There are opportunities to reach a Settlement with HMRC and for everyone to put the matter behind them. Most Settlements can be straight forward, but others can be quite tricky. Has this problem fallen into the “too difficult” pile?
Expert help to support you and your client
I don’t have a magic wand, but I do have many years of experience in dealing with HMRC in these sorts of situations. Whilst the problem may be unique to you and your client, often a solution has already been found. I can identify what the options are and estimate the costs. Not just the tax, interest, and penalties but the professional costs and often more importantly dramatically reduce the emotional cost.
Moreover, your client will be happy the problem has gone away.
The number to call is 07979 313 010.