Tax scheme disputes

Tax mitigation schemes

In recent years, there have been a number of complicated and ambitious tax mitigation schemes promoted to individuals and companies.

While the schemes vary in concept and complexity, they were frequently sold as being ‘backed’ by tax counsel’s opinion, the risks minimised and the benefits over-emphasised.

In our experience, when faced with an HMRC investigation, the approach is usually to negotiate a settlement but even though the HMRC angle is resolved, clients are invariably left considerably out of pocket due to substantial additional tax exposure, interest, penalties and extrication costs.

What can be done

While dealing with the HMRC liability is the short term priority, it is also worth considering whether a client can look to recover the losses suffered.

From a legal perspective, crucially, most clients entered into these schemes on advice. The case law is clear, where advice is provided for a client to enter into a tax mitigation scheme that advice must be clear, comprehensive and provide a full explanation of the risks (See Barker v Baxendale Walker Solicitors (A Firm) [2017] EWCA Civ 2056 and Halsall v Champion Consulting Ltd [2017] EWHC 1079 (QB).

If a client entered into a tax mitigation scheme while relying on inadequate professional advice, it may be possible to recover some or all of their losses from the professional or its professional indemnity insurers.

How we can help

We have a dedicated professional negligence litigation team who have a deep understanding of the underlying nuances and complexities of tax mitigation schemes. The team equally have vast experience of working together with accountants and tax advisors.

Our experience of bringing claims relating to tax mitigation schemes includes:

  • Disguised remuneration trusts
  • Employment Benefit Schemes
  • Biofuel (Green) Schemes
  • Pension liberation Schemes
  • Film partnership Schemes

 

The team is ranked Band 1 in both the Chambers and Partners and Legal 500 2020 legal industry guides.

If you have clients who you think would benefit from early legal advice, we are happy to provide a no-cost, no obligation initial telephone consultation to discuss the merits of a potential claim.

Don't take just take our word for it...