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LexisNexis Confidential The good, the bad, and the downright stupid Mike Truman LLB CTA (Fellow) FCA Editor, Taxation magazine.

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Presentation on theme: "LexisNexis Confidential The good, the bad, and the downright stupid Mike Truman LLB CTA (Fellow) FCA Editor, Taxation magazine."— Presentation transcript:

1 LexisNexis Confidential The good, the bad, and the downright stupid Mike Truman LLB CTA (Fellow) FCA Editor, Taxation magazine

2 2 Fleming / Conde Nast facts Fleming managed to reclaim VAT on cars ten years later Conde Nast had a claim for staff entertainment backdated to 1973 3 year cap had been introduced by SI 1995/2518 House of Lords asked to find that it had been incorrectly brought in and could not apply

3 3 Fleming and Conde Nast Three year time limits not valid Insufficient publicity had been given to the ‘administrative action’ Business Briefs disseminate information but do not change the legal system Put in repayment claims for last 23 years…

4 4 Marks & Spencer The long running saga of the chocolate teacakes… Chocolate biscuit base (standard rated) = Marshmallow (standard rated) + Chocolate (standard rated) + Chocolate covered teacake (zero rated) And sold alongside the biscuits…

5 5 M&S snakes and ladders VAT Tribunal Court of Appeal House of Lords ECJ High Court Teacakes UE 1996 Cap & UE both 1999 Teacakes cap & vouchers both 1997 Cap & UE both 1998 Vouchers (part) cap only Broad reply Cap dropped, UE only UE, for M&S UE

6 6 Marks & Spencer If VAT has been applied at the standard rate incorrectly, fiscal neutrality means it must be repaid Cannot apply unjust enrichment to payment traders but not repayment traders Claims needed!

7 7 FA 2008 change Cap cannot apply to entitlements arising before: 4 December 1996 in respect of output tax overpaid and 1 May 1997 in respect of input tax incurred and under- recovered IF claim made by 1 April 2009

8 8 Drummond Bought five second-hand life policies for £1.96 million Surrender value only £1.75 million Surrendered them to get a life assurance gain of £1,300 But then claims surrender value ‘taken into account’ in computing income charged to tax So should be excluded from CGT computation, and there is a £1.96m loss!

9 9 Two arguments Should surrender value be excluded, as argued? Should acquisition cost be excluded as not wholly or exclusively? Special Commissioner said yes to both, as scheme entirely pre-ordained –which would have meant a GAIN of £1.75 million! High Court said yes to first, but no to second except for the excess over surrender value

10 10 Mr A Enquiry opened 9 August Agent tells Inspector 15 August that A is having surgery and chemotherapy HMRC say they will extend deadline –… to 2 October –and they will very kindly drop round to pick the information up from Mr A’s house Further disputes, 19A notice issued 13 November

11 11 Notice set aside Set aside by the Special Commissioner, but said HMRC had acted reasonably Agent has been ‘busy’ when called –can we make the same complaint when calling HMRC? Had now undertaken not to call for interview until March 2008 at the earliest Documents would be collected from agent’s premises

12 12 Martin Originally told he could not have a CIS6 based on previous unincorporated turnover Not noticed that he had not signed his application Within the HMRC office it got turned into an application for a CIS4 net payment card Claimed damages initially under COP1 But eventually as breach of a duty of care

13 13 Duty of care Statutory provision to issue a certificate did not suggest any damages Judge says that there is no indication parliament intended to provide one Common law duty of care would rarely be implied in the absence of a statutory one But there was a vicarious duty of care in respect of the forms being changed

14 14 Emms Rugby prop forward, has to maintain his fitness and bulk Claims cost of extra food plus supplements Not exclusively and necessarily, would not be required by all players, too much choice Why don’t they have ‘staff canteens’ and medical provision by the club doctors?

15 15 Pringles … are not crisps…! Have to be both made from potato –including flour, starch etc And similar to crisps Pringles made from 42% potato but 15% other flour as well And not similar in shape, packaging etc

16 16 Stackers v Pringles Potato flour/starch Other flours Distinctive shape Stackable ‘Melt in the mouth’ StackersPringles  ??

17 17 Lee Barrett Claimed he had left for a year before 6 April 1998 But even on his figures he had been in the UK some days However his bank records showed that he had been in the UK for more –and had not left before 6 April as his ‘diary’ showed If you are going to become non-resident you’ve got to do it properly!

18 18 Lee Barrett map Cash 6/4 Meal 6/4Groceries 7/4 Groucho 9/4 Cash 14/4Cash20/4 Car park 20/4

19 19 Distinct break Continued in employment, doing same work No permanent home or HQ abroad Family stayed in UK No overseas bank account(?), driving licence, doctor, etc Centre of interests still in UK No ticket stub or boarding pass

20 LexisNexis Confidential Thank you for listening - safe journey home Mike Truman LLB FCA CTA (Fellow) Editor, Taxation magazine

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