Tuesday, February 22, 2011

NO. The Revenue do NOT approve Disclosed tax schemes

I was at a business networking event last week and found myself talking to 'Bill' from 'XYZ Capital management'. He will have seen my name badge referenced the 'Tax Advice Network'.
This is pretty much how the conversation went:

Me: And what do you do at XYZ capital management?
Bill: We help wealthy people manage their capital.
Me: Are you financial advisers?
Bill: More than that. We can help people reduce the tax they pay down to zero, using approved tax schemes.
Me: Approved by whom?
Bill: HMRC. We only use approved schemes that have been fully disclosed under DOTAS
Me: Sorry. HMRC never approve tax schemes. The Spotlights page of their website was recently updated to make this clear as they are fed up of promoters telling people that a disclosed scheme has been approved - when it hasn't.
Bill: Well, once they've been disclosed HMRC don't seem to have a problem with them.
Me: Sorry. I know a bit about all this. But I think it's best I keep off my soapbox and simply say I have no interest in such schemes.

I resisted the temptation to give 'Bill' a full lecture. He asked for my card - which I gave him and suggested that if he wanted to know more about HMRC's Spotlights page he could check out the references to it on this blog. I said I had also addressed the way that tax schemes are, in my view, frequently mis-sold.

If you're reading this 'Bill', do let me know what you think.


  1. Bizarre. DOTAS make it more likely that HMRC will change the law to target the scheme!

  2. Isn't it funny just had a call from somebody that invested (a small amount relatively speaking) in a film partnership in (let's say) 1998-99 that is now going forward to SpC and what do we find. The peddlars of the scheme are now demanding contributions from their gullible past clients to finance the fighting of HMRC. And all they have done is provided a few sheets of paper saying here's what we need from you (oooh isn't it such a small % of what is at stake for you!!) to take the case to appeal. Speak about having your cake and eating it and milking the gravy pot till it's dry.

    So why would HMRC be taking such cases to appeal some 11 years after they were undertaken - well I suppose they would find it objectionable that somebody could invest say £10K in a film and get £13K (yes £13K in tax refunds) Too good to be true or what and some people are in for a lean time when they have to pay the tax along with another say 70% of the tax as interest and the threat of a penalty in addition into the bargain.

  3. Fantastic article.
    It is amazing the number of highly educated professionals who fall for the type of sales nonsense that many of these 'advisors' push.
    You see it all the time with..."Barrister xxxx, QC has reviewed our scheme and advises that it is fully HMRC compliant and approved"..........just an opinion and almost never tested before the courts.