Accelerated Payment Notice 2015 User Guide for Contractors

Are you a contractor that has used a tax avoidance scheme? Received an Accelerated Payment Notice? Read our 2015 APN User Guide prepared by our Tax Specialist, Michael Perry to understand the vital facts that you need to be aware of!

Accelerated Payment Notice 2015 User Guide
  1. HMRC CONTRACTOR LOANS SETTLEMENT OPPORTUNITY CAME TO AN END ON 30 JUNE 2015
  2. GENERALLY THE FOLLOWING SHOULD ALL BE CHECKED (ESPECIALLY IF YOU ARE REPRESENTED BY A TAX SPECIALIST)

    1.  SECTION 9A ENQUIRIES - ARE THESE LEGAL AND WERE THEY COMMENCED BY HMRC WITHIN THE TIME LIMIT ALLOWED?

    2. SECTION 29 DISCOVERY ASSESSMENTS - ARE THESE LEGAL AND WERE THEY ISSUED WITHIN THE TIME LIMIT ALLOWED?

    3. ARE THE LOAN AMOUNTS CORRECT?

    4. HAS THE P11D INTEREST BENEFIT IN KIND BEEN DEDUCTED FROM THE LOAN AMOUNT BEFORE ASSESSMENT?

    5. ARE THE HMRC TAX CALCULATIONS OF THE TAX IN DISPUTE ALL CORRECT?

    6. HAVE YOU PROVIDED GOOD COOPERATION TO REDUCE ANY POSSIBLE FUTURE HMRC PENALTIES?

  3. CURRENT POSSIBILITIES

    1. ACCELERATED PAYMENT NOTICES (APN’S) - THREAT OF LEGAL RECOVERY ACTION FOR NON OR LATE PAYMENT - YOUR ASSETS ARE AT RISK

    2. APN’S FOR NATIONAL INSURANCE TOO

    3. INTEREST ACCRUING FROM THE ORIGINAL DUE DATE UP TO FULL PAYMENT OF THE TAX IN DISPUTE

    4. LATE PAYMENT PENALTIES FOR APN’S - UP TO 15% 0F TAX DUE OVER 11 MONTHS AFTER THE STATUTORY 90 OR 120 DAYS ALLOWED FOR PAYMENT

    5. INHERITANCE TAX COULD STILL BE CHARGED WHERE TRUST ARRANGEMENTS ARE INVOLVED

    6.  YOU CAN STILL SETTLE AT ANYTIME BUT ARE UNLIKELY TO OBTAIN THE SAME TERMS AS THE SETTLEMENT OPPORTUNITY

  4. HMRC LOSE IN LITIGATION

    1. IF HMRC ARE UNABLE TO OBTAIN A FINAL JUDICIAL DECISION IN THEIR FAVOUR, THE MONEY YOU PAID ON THE ACCELERATED PAYMENT NOTICES WILL BE REPAID TO YOU WITH INTEREST. THE LENGTH OF TIME INVOLVED IN LEGAL ACTIONS IS UNCERTAIN.

  5. HMRC WIN IN LITIGATION

    1.  HMRC CAN ATTEMPT TO OPEN EARLIER TAX YEARS WHICH HAVE NOT YET BEEN ASSESSED AND CHARGE INTEREST AND PENALTIES ON THE TAX DUE

    2. SETTLEMENT COULD BE BASED ON INVOICE VALUE RATHER THAN LOANS AND TAXED UNDER PAYE OR SELF EMPLOYMENT RULES WITH THE ADDITION OF NATIONAL INSURANCE AND PENALTIES LIKELY

    3. PENALTIES FOR INACCURATE TAX RETURNS - BETWEEN 15% AND 70% OF THE TAX DUE - 100% IF CONCEALED - NOT DISCLOSING OR INADEQUATE DISCLOSURE OF USE OF AN AVOIDANCE SCHEME

    4. PENALTIES FOR FAILURE TO NOTIFY CHARGEABILITY - BETWEEN 20% AND 70% OF THE TAX DUE - 100% IF CONCEALED - NOT COMPLETING TAX RETURNS WHEN REQUIRED TO DO SO

    5. PENALTIES FOR FAILURE TO TAKE CORRECTIVE ACTION ON FOLLOWER NOTICES - BETWEEN 10% AND 50% OF THE TAX DUE - APPLIES TO NON DOTAS SCHEMES ONLY

    6. HMRC CAN PUBLISH DETAILS OF TAX DEFAULTERS IF CERTAIN CONDITIONS ARE MET