Thank you! It was a quite a week – the ceremonies were super and it was fun to share the experience with Jonathan Bremner QC, who was also being appointed. Two days later, I was in the Supreme Court (on Project Blue).
What’s in your in-tray?
A broad range of business tax matters and VAT, including substantial corporate debt and transfer pricing disputes, cases raising cross-border issues, interesting matters on income, losses and carried interest, as well as several VAT cases concerning financial services, insurance and real estate. I have another Supreme Court hearing in the diary (Derry) and three or four more Court of Appeal cases, along with other proceedings at various stages before the tribunals.
If you could make one change to tax, what would it be?
With every new Finance Act, I grow increasingly concerned about the complexity of the tax code and the scope for injustice when taxpayers are caught unawares. A prime example is Lobler [2015] UKUT 152 (TCC) (concerning the part-surrender insurance policy rules). Together with the CIOT and LITRG, I spent a lot of time working with the insurance industry, the tax profession and HMRC to identify a suitable change in the law. This resulted in the amendment at section 9 of F(No. 2)A 2017 which permits HMRC to recalculate disproportionate gains on a ‘just and reasonable’ basis. I think there is real merit in an equivalent provision of general application (a ‘reverse-GAAR’, if you like) which allows HMRC (or the courts, if HMRC refuse) to ameliorate harsh tax charges in cases of extreme unfairness.
Is there a recent tax case that has caught your eye?
Tailor [2017] UKFTT 845 (TC). It is the first opportunity for HMRC to apply the new ‘just and reasonable’ provision I mentioned above. I hope they consider the position carefully and act responsibly, otherwise the F(No. 2)A 2017 amendment risks becoming a dead letter.
Looking back on your career to date, what advice would you give to others?
Work hard, persevere and, above all, be focused. Tax is not an area in which you can ‘dabble’, so it is vital to become an expert in your field and keep up to date with developments in the legislation and case law. Enjoy the challenge!
Are there any new rules of particular concern?
It isn’t a ‘new’ rule per se, but the application of the GAAR in the first GAAR panel opinions is concerning, notably ‘Employee rewards using gold bullion (Mr X)’ (18 July 2017). Briefly, the taxpayer argued that he was not subject to employment income tax. Without commenting on the technical merits of the scheme, it is important to bear in mind that the GAAR is only engaged if, in effect, the scheme would otherwise have succeeded. In Mr X’s case, this would mean that on a proper application of ITEPA 2003, Mr X would have no earnings (and no deemed earnings under the disguised remuneration rules). Given the sheer breadth of the concept of ‘earnings’ following Rangers [2017] UKSC 45, it is hard to see how there is room for the GAAR to apply in a case such as this without casting aside proper analysis, thereby undermining legal certainty and the integrity of the tax code.
Finally, you might not know this about me but…
I’ve climbed five of the ‘seven summits’ (each continent’s highest peaks) and summited three so far. I love the change of scene, the personal challenge and the camaraderie born of pulling together in a harsh environment with people who were strangers before we all stepped off the plane.
Thank you! It was a quite a week – the ceremonies were super and it was fun to share the experience with Jonathan Bremner QC, who was also being appointed. Two days later, I was in the Supreme Court (on Project Blue).
What’s in your in-tray?
A broad range of business tax matters and VAT, including substantial corporate debt and transfer pricing disputes, cases raising cross-border issues, interesting matters on income, losses and carried interest, as well as several VAT cases concerning financial services, insurance and real estate. I have another Supreme Court hearing in the diary (Derry) and three or four more Court of Appeal cases, along with other proceedings at various stages before the tribunals.
If you could make one change to tax, what would it be?
With every new Finance Act, I grow increasingly concerned about the complexity of the tax code and the scope for injustice when taxpayers are caught unawares. A prime example is Lobler [2015] UKUT 152 (TCC) (concerning the part-surrender insurance policy rules). Together with the CIOT and LITRG, I spent a lot of time working with the insurance industry, the tax profession and HMRC to identify a suitable change in the law. This resulted in the amendment at section 9 of F(No. 2)A 2017 which permits HMRC to recalculate disproportionate gains on a ‘just and reasonable’ basis. I think there is real merit in an equivalent provision of general application (a ‘reverse-GAAR’, if you like) which allows HMRC (or the courts, if HMRC refuse) to ameliorate harsh tax charges in cases of extreme unfairness.
Is there a recent tax case that has caught your eye?
Tailor [2017] UKFTT 845 (TC). It is the first opportunity for HMRC to apply the new ‘just and reasonable’ provision I mentioned above. I hope they consider the position carefully and act responsibly, otherwise the F(No. 2)A 2017 amendment risks becoming a dead letter.
Looking back on your career to date, what advice would you give to others?
Work hard, persevere and, above all, be focused. Tax is not an area in which you can ‘dabble’, so it is vital to become an expert in your field and keep up to date with developments in the legislation and case law. Enjoy the challenge!
Are there any new rules of particular concern?
It isn’t a ‘new’ rule per se, but the application of the GAAR in the first GAAR panel opinions is concerning, notably ‘Employee rewards using gold bullion (Mr X)’ (18 July 2017). Briefly, the taxpayer argued that he was not subject to employment income tax. Without commenting on the technical merits of the scheme, it is important to bear in mind that the GAAR is only engaged if, in effect, the scheme would otherwise have succeeded. In Mr X’s case, this would mean that on a proper application of ITEPA 2003, Mr X would have no earnings (and no deemed earnings under the disguised remuneration rules). Given the sheer breadth of the concept of ‘earnings’ following Rangers [2017] UKSC 45, it is hard to see how there is room for the GAAR to apply in a case such as this without casting aside proper analysis, thereby undermining legal certainty and the integrity of the tax code.
Finally, you might not know this about me but…
I’ve climbed five of the ‘seven summits’ (each continent’s highest peaks) and summited three so far. I love the change of scene, the personal challenge and the camaraderie born of pulling together in a harsh environment with people who were strangers before we all stepped off the plane.
