News
Offshore tax claim back gets the go ahead
28 January, 2010
The High Court has given the HMRC the go ahead to claim back millions from UK residents who have their money in tax-haven offshore trusts whether or not they were set up many years ago. The legislation has been introduced with retrospective effect.
Even though the court heard that claw back tax would suggest bankruptcy, mental health problems or even the loss of homes, Mr Justice Kenneth Parker ruled that the backdating of demands did not breach human rights.
The ruling came as a shock for self-employed IT consultant, Robert Huitson, from Bredbury, Stockport, Cheshire, who had challenged the new rules. Even though the judge had refused him permission to appeal, his lawyer felt that they would ask the Court of Appeal to hear the case due to its important general implications.
Robert Huitson has taken advantage of a scheme designed and marketed by Montpelier Tax Consultants in the Isle of Man for many years.
This new legislation will mean that Robert Huitson will face a claim back in excess of £100,000 relating to the money paid into Robert Huitson Family Settlement in 2001.
Documents show that 57 other scheme users claim they cannot meet these tax demands, another 29 only able to settle if they sell or re-mortgage their homes, with several others facing personal bankruptcy. Robert Huitson’s lawyer was reported as saying that the retrospective provisions of the 2008 Act affected about 2,500 scheme users and would involve about £300 million. He argued that the retrospective element of the legislation was incompatible with the “right to free enjoyment of property”, as protected by Article 1 of Protocol 1 of the European Convention of Human Rights.
The judge dismissed the challenge and ruled that HMRC had not acted unlawfully or disproportionately.