Media Centre

Friday 19th October 2018 - Last update: February 25th, 2014.

Chris Moyles and Tax Avoidance: 1 down, 64,999 to go

February 24, 2014

Author:

Type: Advice for Businesses, Tax, Trending

 

Chris Moyles has now found out that packaged tax schemes do not always do what they say on the tin. As widely reported in the media, he used a scheme called ‘Working Wheels’ that was designed to create a tax loss of £700k. It involved trading in second hand cars, but more importantly, required him to enter into a circular financial transaction to generate an interest ‘expense’ for tax purposes. Seven whole years after the scheme was entered into, the Tax Tribunal has decided it did not work, for three reasons:

 

  1. He was not actually trading;
  2. The technical basis for the interest ‘expense’ was not due
  3. The transactions were effectively a sham, carried out for no reason other than tax avoidance.

 

There was nothing illegal in what Mr Moyles did, and the case report does not indicate that any penalties were charged. He will just be out of pocket for the tax, interest and the fees for the scheme.

 

The bigger problem faced by HMRC is that there are by their own reckoning  about 65,000 more unresolved cases involving tax schemes, and they simply do not have the time or resources to take them all to Tribunal. These include EBTs and SDLT schemes, as well as the Working Wheels scheme. So they are now working on a ‘Accelerated Payment’ proposal. The idea is that anyone who has used a scheme ‘similar’ to one defeated at Tribunal will be required to pay up, before their own case is settled. Draft legislation has been put forward, which could find its way to the statute book later this year. If it does, anyone who has used ‘Working Wheels’ will be required to pay the tax they thought they had saved.   Of course, such individuals could still fight their case through the courts – but they might face a very long wait before they get their case heard.

www.fashioncarpet.com.ua

www.medicaments-24.net

www.baden-medservice.com