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TonyTax
TonyTax, Tax Consultant
Category: Tax
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Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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In 2010 my sister and myself were advised to enter into a sdlt

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In 2010 my sister and myself were advised to enter into a sdlt scheme by a tax planning company. We have just received a letter from the planning company's administrators issuing us with a credit note for the fees we paid them. We are obviously one of a number of creditors and do not expect to get the money back. More worrying is that we may get a letter from HMRC asking for the stamp duty payment + interest. Is there a time limit for HMRC to issue a demand for the monies?
Submitted: 2 years ago.
Category: Tax
Expert:  TonyTax replied 2 years ago.

Hi.

I obviously don't know anything in detail about the scheme you entered into but it would appear to be a stamp duty avoidance scheme. It doesn not surprise me at all that the company who sold you this scheme has gone into administration.

There is no time limit for HMRC to pursue collection of confirmed tax liabilities as there is with other debts except in very limited circumstances. You need to find out whether your scheme is or has been registered with HMRC, investigated by HMRC and whether any court action is pending. You didn't mention whether HMRC had put you on notice over this and if they haven't it may never come to light but I doubt that very much.

Normally, the creators of tax avoidance schemes promise to fight any HMRC attack on behalf of their clients but that won't happen in your case as their company has gone to the wall. You, therefore, have to decide whether you will fight your corner alone or with other buyers of the scheme if and when HMRC ask you to pay the stamp duty.

Most tax avoidance schemes have to be registered with HMRC these days but I know that not all of them are. That is also something you need to find out as that will tell you whether HMRC know about it or not. There is information on registering tax avoidance schemes here. As user of such a scheme, you should register the fact with HMRC.

I hope this helps but let me know if you haver any fiurther questions.

Customer: replied 2 years ago.

Not sure if you got my last reply. Basically I said that all of this was done through a solicitor who was recommended as an expert in this area by an accountant. She said that a tax return had been issued to HMRC at the time and that we need to wait for 9 months to see if HMRC queried it. They did not and so we presumed all was OK. I have emailed the solicitor to see whether they can help. Can they be implicated in all of this?

Expert:  TonyTax replied 2 years ago.

I'm not sure what type of return was submitted to HMRC by your accountant. If you complete self-assessment tax returns, then they will have notified HMRC of your involvement in the scheme via the tax return. If not, there is a form which has to be completed instead.

If is was the solicitor who suggested the scheme to you, they will have been paid a commission by the scheme creator. There is unlikely to have been a criminal offence by the solicitor or the scheme creator so I'm not sure what you mean by implicated.

The fact that schemes have to be registered with HMRC and are given a number by HMRC does not imply approval. There are so many schemes under investigation and the best person to tell you if yours is will be the solicitor who got you involved. If you have heard notthing directly from HMRC especially if your accountrant informed HMRC of your participation in the scheme is a good sign but not a definitive sign that you are out of danger of being asked to pay the stamp duty.

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