IT contractor faces deportation after tax return changes

A freelancer whose IT skills are on the shortage occupations list has found both an unlikely ally -- and an unexpected foe, in a tax debacle that has left him destitute and facing deportation.

Sidharth Vijay, who arrived in the UK in 2011 is being championed by a Lib Dem lord, after not HMRC -- but the Home Office deemed him a ‘security threat’ following amends he made to his tax return.

About 1,000 other highly-skilled migrants are in a similar bind to Vijay (his alias), due to the agency overriding HMRC’s approval of the changes by using immigration rules drawn up to target terrorists, says Lord Taverne.

'Wholly inappropriate'

In an open-letter to the Daily Telegraph, the Liberal Democrat peer explained: “Tax errors used to be dealt with under subparagraph 322(1) of the immigration rules, designed to deal with false returns.

“[But the Home Office] kept losing cases and failed to achieve its removal targets, so turned instead to subparagraph 322(5), designed for serious crimes such as murder and terrorism -- wholly inappropriate for legitimate amendments of tax returns.”

In Vijay’s case, he volunteered to HMRC that his 2012/13 tax calculation had an error equating to him owing £4,000, and did so within the 12-month window afforded to taxpayers.

Although the amendment and payment were accepted by HMRC, Vijay, who has a UK-born daughter, was told in February 2018 that the Home Office had refused him settlement.

Confusingly for the Toshiba technologist who also run his own IT consultancy, his refusal was “entirely triggered” by figures obtained from a form he did not submit, a SA02, the Guardian understands.

'Greater betrayal'

Since then, he has racked up a reported £15,000 in legal costs trying to fight the decision, in addition to incurring Home Office fees – a particular injustice according to Lord Taverne, a qualified barrister.

“Under that sub-paragraph [322(5)], which deprives immigrants of the right to work, rent property or access to the NHS…the burden of proof lies on the migrants to prove their innocence, not on the Home Office to prove guilt -- and not just innocence but that the Home Office’s decision was ‘perverse’ or ‘irrational’.

“To top it all,” the peer added, speaking in the House of Lords, “they cannot get legal aid. What could be a greater betrayal of our traditional respect for justice and the rule of law?”

However, the minister of state at the Home Office has said that where the agency refuses settlement, “this is not about people making minor tax errors.”


“We are now able to check what applicants told us in the past about their self-employment and compare it to what they have told HMRC for the same period,” began Baroness Williams of Trafford.

“There is a clear pattern of abuse where, more often than not, the self-employed earnings used to claim points in the tier 1 application have been £10,000 higher than the self-employed earnings reported to HMRC. ​

“Where employment circumstances do not add up and applicants claim to have been working in a full-time low-paid manual job while simultaneously earning very high amounts from self-employed work for which the evidence is weak, we must consider paragraph 322(5)”.

Seemingly unsatisfied by the response, Lord Taverne countered with a statement yet to receive a reply: “Will the minister deal with the point that paragraph 322(5), which is concerned with terrorists, is used in connection with mis-statements in tax returns?”

'Character and conduct'

In the Baroness’s response (provided earlier this month and since Lord Taverne’s letter), the minister spoke of refusing the application to individuals whose “character  and conduct” make them undesirable to be allowed to live in the UK.

With deportation possible within 14 days of such a decision, those rejected settlement under sub-paragraph 322(5) get the ‘terrorism’ reasoning permanently marked on their passport.

Vijay has said: “How is using my legal right to complete an in-time tax return an offence on a par with being a threat to national security?”

He has also asked: “If parliamentary legislation grants me a right and the HMRC – which is a statutory body – honours it, then isn’t it true and obvious that Home office should acknowledge and abide by it too?”

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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