A million pound tax scheme marketed by PwC has been shut after a Court of Appeal hearing. The scheme, which dates back to 2002/2003, was used by about 200 people who now have to pay back the full capital gains tax as well as interest.
The case, Howard Schofield v HMRC, which involved losses to the Exchequer of about £11m, was described by the court as similar to the Ramsay case, where artificial losses were created to avoid a capital gains tax bill.
"Under the scheme as a whole, the options were created merely to be destroyed. They were self-cancelling. Thus, for capital gains purposes, there was no asset and no disposal," said Lady Justice Hallett. "To my mind, this appeal was a thinly disguised attempt to undermine the Ramsay principle."
Two observations do, of course, follow. Yet again we see PWC marketing tax abuse. Second, we badly need a general anti-avoidance principle to stop this abuse. And unfortunately the government is going to deny us one, sopping us off instead with a useless general anti-avoidance rule, which isn't even any such thing.
But then. PWC sponsor all the major political parties, so wat do we expect?
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why do we need a GAAR based on this case? the tax payer lost and have to pay the tax and presumably interest, surely this demonstrates that HMRC and the courts dont actually need a GAAR to challenge and win in tax avoidance cases?
As noted – because a general anti-avoidance principle would have killed this dead in the first place
“To my mind, this appeal was a thinly disguised attempt to undermine the Ramsay principle. Once it was accepted that the principle remains valid, and once the findings of the First Tier Tribunal were accepted, this appeal was doomed to fail.” Lady Justice Hallet.
You and Michael Meacher (not really sure who briefs who) having been extolling the virtues for your particular version of a Gantip on the basis that Lord Hoffman (strangely only him and not the other Law Lords) destroyed the Ramsey Principle.
In the light of Scolfield and its application of Ramsey, do you and Mr Meacher still maintain a GAAR is required and if so why?
Because we would not have needed to wait ten years to get to this point
Simple
Except to you
Well why don’t you explain.
Lets have a look at the facts: HMRC first made enquiries into the taxpayers affairs in 2004 in respect of the 2003 year of assessment. The deductions for CGT were disallowed in 2008 on the grounds that it was an avoidance scheme and the matter came before First Tier Tribunal in 2010. It reached the Court of Appeal in 2012 having also paid a visit to the the Second Tier in 2011.
So I fail to see how your GAAR/Gantip will shorten the the process unless you intend to deprive the taxpayer of the right to object and appeal.
In 2002 it was not clear Ramsey applied
Remember Westmoreland?
A Gantip removes the uncertainty and kills such schemes