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Supreme Court Decision - Share options and banker's bonuses

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    #11
    Tax bill will be covered by the bank, UBS in particular.

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      #12
      Given the mention of Big Group, I'll comment.

      The UBS/DB schemes were from a generation ago and were acceptable in their day. I very much suspect that there are a number of follower banks who were doing something similar and will now settle so that the final tax collected will be substantially more than the headline value of £135m.

      Getting there has require 12 years of investigation and 4 stages of Courts. I can see no suggestion that HMRC is seeking costs but they may do. I would conservatively estimate HMRC costs (paid by you) as being close to £1m plus internal time. That internal time might be say a team averaging 25 for 12 years at £50k a year each = £15m.

      Let's call that £15m all up. To collect £135m. That's 11% of the tax. (I'm ignoring interest).

      That's substantially more than the usual cost of collecting tax revenue.

      Contractor schemes pre 2011 might be collated into 3 types and a positive decision on each will be needed. Post 2011, perhaps 5 to 8 different types.

      It is always possible for HMRC to take a totally uncommercial stance and spend (your) money on fighting them all. The time and cost might be seen as necessary to preserve policy. My guess however is that a well put together technical analysis that causes them to hesitate and even think about other analysis is going to be considered at the highest levels.

      Is that a guarantee? no.

      Is a win for HMRC in UBS/DB a guarantee that contractor schemes are dead? no.

      Does this mean that litigation on contractor schemes is not worthwhile? no.

      The point is, whilst the UBS/DB result has perhaps shifted the balance very slightly, it has not rendered Big Group (or other litigation groups) strategy obselete.
      Best Forum Adviser & Forum Personality of the Year 2018.

      (No, me neither).

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        #13
        Originally posted by webberg View Post
        I very much suspect that there are a number of follower banks who were doing something similar and will now settle so that the final tax collected will be substantially more than the headline value of £135m.
        There is another £30m of tax to come from 27 others. Presumably, these will now get follower notices.

        Originally posted by webberg View Post
        I can see no suggestion that HMRC is seeking costs but they may do.
        Why would HMRC not seek costs? It would be normal for the winner to claim costs at the UTT and above.

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          #14
          That internal time might be say a team averaging 25 for 12 years at £50k a year each = £15m.

          I really doubt it.

          Comment


            #15
            Originally posted by neil99 View Post
            Tax bill will be covered by the bank, UBS in particular.
            Which will ultimately be re-charged to their customers and shareholders
            Join Big Group - don't let them get away with it
            http://www.wttbiggroup.co.uk/

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              #16
              HMRC will not claim cost as most of litigation start with the arrangement that no party will claim cost.
              Nothing is dead until it is done. But for HMRC to change stance they need to have a carrot. If HMRC lose against Rangers in Supreme Court and / or in FTT next year where first mass marketed scheme will be in court and/or fisher case to be heard in April goes against HMRC - then yes HMRC will soften the approach. Until then just on cost basis of going to Supreme Court even if HMRC gives 11% discount to us it does not mean much.

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