Big Group: Forging a path to Tribunal

Current Legislation

Thousands of people are currently being investigated by HMRC for their use of so-called contractor loan avoidance schemes.

Under current legislation, HMRC is entitled to open enquiries and then take no action to resolve the position for several years, which offers no finality for taxpayers.

WTT Big Group was born from the need to offer a robust resolution strategy for those involved in such arrangements. 

HMRC has been unwilling to negotiate or listen to reason and their analysis shows little understanding of the substantive arguments; however, we need to expose this to an independent party, which in this case is the First Tier Tax Tribunal. 

Very few cases on such arrangements have been heard by the Tribunal to date and the arguments advanced by taxpayers so far are narrow and do not cover all angles. 

Therefore, litigation based on our technical analysis is the way forward and our strategy is to vigorously pursue the judicial process for several cases that demonstrate the fundamental elements of our arguments.

Four Schemes

We currently have four schemes at the preliminary Tribunal stage and are in the process of advancing a pre-DR scheme.  We are taking the initiative and advancing our preferred cases without allowing HMRC to dictate the timetable.  

We need to take advantage of HMRC’s poor preparation and their reluctance to have their views tested by a court.  

Also, in the current climate, we are seeing HMRC make errors during litigation leading to negative comments from judges and more adverse decisions.     

These conditions point towards this being the perfect time to strike.

Make no mistake, HMRC know what is at stake here.  We must be prepared to counter their arguments and delaying tactics, which we have already seen come into play. This relies on not only our own attention to detail, but cooperation from all Big Group members in providing relevant documents and information when requested. 

Tribunal rules mean tight, strictly enforced timeframes within which to work and we therefore rely on our members to act opportunely.

HMRC has so far had a sense of security that access to justice is out of reach for the majority of taxpayers, due to the prohibitive costs involved.

To stand the best chance of success, expert legal counsel is a must and the funding needed to properly prepare and bring a case to the First Tier Tribunal is in the region of £150000. 

WTT have been working on our tax treatment arguments and refining our position for several years with the help of a renowned tax barrister and his junior counsel, so our hand has never been stronger.    

Big Group benefits

Legal action on any scheme will benefit all Big Group members and we must continue acting as a coherent group.

It is within everyone’s interests for us to grow the group, not least financially. Those who remain unaware will fall foul of HMRC’s strategy and have no protection.

We would expect to be heading for a substantive hearing by mid-2020. This is not fixed, as the Tribunal is very busy and we are in their hands when it comes to receiving a date.

In summary, this is a crucial time for WTT Big Group and we are continuing to build on our momentum as we sense the tide turning in our favour.

More information about Big Group can be found here.