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Branston Pickle

Lineker follow-up

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7 hours ago, Barbe bleu said:

To be honest your earlier post isn't particularly clear.

I skim read the two judgments.  God knows why. But my understanding is as follows.

GL set up a Partnership to organise/channel his business activities. All of the money earned  by this partnership less £30,000 paid to his then wife, then went to GL. GL paid NIC and income tax on those earnings.  The partnership did not try to pay dividends in lieu of salary so there was no tax efficiency from this part of rhe arrangement.

HMRC assessed that the partnership was akin to a limited company and that Ir35 should apply.  They also found that there was an underpayment of £6500 in NIC.

GL objected to the assessment and appealed. 

The judge said IR35 could apply to partnerships (in this sense HMRC were successful) but not in this case (so GL won overall)

I can see why the case was brought as the sharpening/clarification of the law might have been useful. I'm not entirely sure why GL didn't just pay the £6500 and be done with it (but that's his call I guess).

I'm not sure what happened to the disputed NIC but it does seem from my reading that the papers were wrong to suggest this was a standard IR35 case where the defendant sought to be tax efficient.

 

A Limited Liability Partnership can't pay dividends. Partnerships do not have shareholders. 

The partnership did not pay wages to Mrs Lineker or employ her. She was a partner and the money she received was her share of the partnership profit in accordance with the partnership agreement. 

HMRC did not suggest that a partnership is similar to a Company. It suggested that IR35 applies to partnerships. Partnerships and companies are completely different legal entities. 

You seem to think that Lineker set up this structure for tax reasons and don't understand why there was little or no tax advantage to the arrangement. What the gutter press have failed to consider is that the structure may not have been created to save income tax or NIC.  We don't know why he did it this way but there could be several reasons unconnected to tax including protection in the event of divorce. I'm guessing there, I know nothing about marital law. But that's his business not yours or mine and the court isn't required to consider it. 

The £6,500 isn't due because Lineker won. What is clear is that he didn't go to all that effort to save what is, relatively speaking, a tiny amount of money. 

I'm sorry you don't find my earlier post clear. Trying to simplify complex issues isn't easy. 

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1 hour ago, dylanisabaddog said:

 

I'm sorry you don't find my earlier post clear. Trying to simplify complex issues isn't easy. 

That's OK.  Odd case all around. I still can't really see why Lineker bothered. He must have paid many many times more in costs than he was asked to pay in tax.

Once again the lawyers are the winners. I guess HMRC won on a niche point but the  big winners were definitely the guys in wigs

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Lineker bothered because in all likelihood it was nothing to do with tax. It's also possible that he was simply being mischievous. 

Another possibility is that Lineker values his freedom of speech and made it quite clear that the BBC had told him he could say what he wanted as long as he was freelance. He didn't want to be accused of tax avoidance by using a Limited Company so he choose a way of being freelance that didn't save him tax. Don't take that as fact, it's just a wild guess. But you do need to bear in mind that Lineker is a hugely intelligent man who will have fully understood what he was doing. 

The real question is why HMRC bothered. Both @sheffcanaryand I have put forward our views above, either could be right or wrong. In terms of public finances, it's a shocking waste of time and money. It's not just the court, Barrister and employee costs, it's the amount of money those people would have brought in if they'd concentrated their attention elsewhere. 

The concern is that 'the establishment' wanted to shut up a man who is a nuisance to them and choose an extremely foolhardy way to do it. 

 

Edited by dylanisabaddog
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28 minutes ago, dylanisabaddog said:

 

The real question is why HMRC bothered. Both @sheffcanaryand I have put forward our views above, either could be right or wrong. In terms of public finances, it's a shocking waste of time and money. It's not just the court, Barrister and employee costs, it's the amount of money those people would have brought in if they'd concentrated their attention elsewhere

 

Im not interested in why Lineker set up a Partnership. The point i am making is that it was presumably open to him to accept HMRC case, pay the 'missing' £6500 and be done with it.

 Be he chose to embark on something that he must have known or been advised would cost him a lot more in the long run in money and stress

Why HMRC chose not to concede I guess is highly technical but it did win on one ground which might give a clue as to why it continued. Hopefully a loophole is now closed as a result of this

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3 minutes ago, Barbe bleu said:

Im not interested in why Lineker set up a Partnership. The point i am making is that it was presumably open to him to accept HMRC case, pay the 'missing' £6500 and be done with it.

 Be he chose to embark on something that he must have known or been advised would cost him a lot more in the long run in money and stress

Why HMRC chose not to concede I guess is highly technical but it did win on one ground which might give a clue as to why it continued. Hopefully a loophole is now closed as a result of this

No, no and no. 

Why should he accept the HMRC case? Everyone in the profession and the judge knew they were wrong. I doubt it caused him stress, he was 100% certain of winning. 

HMRC hasn't closed a loophole. There wasn't a loophole. 

The £6,500 isn't missing. It isn't due. It was the potential difference between being an employee and freelance which on income probably in excess of £5m is just a drop in the ocean. 

For the last time, he didn't do this for tax reasons. It would have left him worse off when taking accounting costs into the equation. Try considering for one moment that not everyone is out to fleece HMRC and think about all the other reasons he may have done it. 

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3 minutes ago, dylanisabaddog said:

No, no and no. 

Why should he accept the HMRC case? Everyone in the profession and the judge knew they were wrong. I doubt it caused him stress, he was 100% certain of winning. 

HMRC hasn't closed a loophole. There wasn't a loophole. 

The £6,500 isn't missing. It isn't due. It was the potential difference between being an employee and freelance which on income probably in excess of £5m is just a drop in the ocean. 

For the last time, he didn't do this for tax reasons. It would have left him worse off when taking accounting costs into the equation. Try considering for one moment that not everyone is out to fleece HMRC and think about all the other reasons he may have done it. 

Yes. Why not. Its the principle isn't it. Mind you it should still be possible to win on principle without seeing all your rightful return or more go to a third party. That in itself should be a principle. Unfortunately with our over legalistic society that favours the wealthy that often doesn't seem possible.

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I think GL's motivation was the strange but amicable way he has split from his wife. I would expect in the divorce settlement she was entitled to a share of future earnings as well as the earnings up to the split. I won't go any deeper, but I think the point HMRC was trying to make was this LLP and indeed GL's relationship with his wife was a sham - but the arrangement in the latter case was legally agreed in the family court presumably, which thus saw HMRC trying to put one division of the English law courts against another - that's almost a constitutional row there!

Consider if we were under the rule of Putin or Netanyahu! The freedom of the judiciary to apply the law independently of Whitehall is the issue both Dylan and I are more concerned about in this case!

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2 hours ago, dylanisabaddog said:

No, no and no. 

Why should he accept the HMRC case? Everyone in the profession and the judge knew they were wrong. I doubt it caused him stress, he was 100% certain of winning. 

My understanding is that parties in these cases meet their own costs.  In purely economic terms he's probably paid six figures to save £6500.  

I'd be very surprised if this didn't cause him stress. I've been involved in enough legal cases in other fields to know that it will, no matter how sure you are.

He chose to put up this fight.  Its  matter for him if it was worth it.  Most of all I hope that it has closed a loophole for the HMRC.

 

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1 minute ago, Barbe bleu said:

My understanding is that parties in these cases meet their own costs.  In purely economic terms he's probably paid six figures to save £6500.  

I'd be very surprised if this didn't cause him stress. I've been involved in enough legal cases in other fields to know that it will, no matter how sure you are.

He chose to put up this fight.  Its  matter for him if it was worth it.  Most of all I hope that it has closed a loophole for the HMRC.

 

Even when he's bad , he's  good.

Saint Gary. 

The boy is Golden .😇

HMRC should thank him.

Edited by wcorkcanary

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9 minutes ago, shefcanary said:

 

Consider if we were under the rule of Putin or Netanyahu! The freedom of the judiciary to apply the law independently of Whitehall is the issue both Dylan and I are more concerned about in this case!

And the independence of the judiciary has been proved so rest assured!

I never believed the conspiracies about HMRC taking dictation from ministers with personal vendettas.

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2 hours ago, dylanisabaddog said:

 

For the last time, he didn't do this for tax reasons. It would have left him worse off when taking accounting costs into the equation. Try considering for one moment that not everyone is out to fleece HMRC and think about all the other reasons he may have done it. 

For last time, I didn't say it was about tax! I don't care why he set up a Partnership, I'm just interested in why he chose to fight. Seems to me that it was only ever going to fund a barristers holiday to mystique.

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35 minutes ago, Barbe bleu said:

For last time, I didn't say it was about tax! I don't care why he set up a Partnership, I'm just interested in why he chose to fight. Seems to me that it was only ever going to fund a barristers holiday to mystique.

Mystique? Is that the island Princess Mygaret went to ? 

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Fwiw , if i was loaded a la Gary , I'd fight it too.  Sometimes principles are more important than money, arent they Ethics? I also find GL mildly irritating on TV but that's  a different issue. 

Edited by wcorkcanary
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1 hour ago, shefcanary said:

I think GL's motivation was the strange but amicable way he has split from his wife. I would expect in the divorce settlement she was entitled to a share of future earnings as well as the earnings up to the split. I won't go any deeper, but I think the point HMRC was trying to make was this LLP and indeed GL's relationship with his wife was a sham - but the arrangement in the latter case was legally agreed in the family court presumably, which thus saw HMRC trying to put one division of the English law courts against another - that's almost a constitutional row there!

Consider if we were under the rule of Putin or Netanyahu! The freedom of the judiciary to apply the law independently of Whitehall is the issue both Dylan and I are more concerned about in this case!

Stop trying to confuse LYB. It's obviously difficult for him to understand how someone can possibly be so decent and also be prepared to pay to protect his rights. 

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8 hours ago, wcorkcanary said:

Fwiw , if i was loaded a la Gary , I'd fight it too.  Sometimes principles are more important than money, arent they Ethics? I also find GL mildly irritating on TV but that's  a different issue. 

Just a little bit confused about how his now divorced missus is going to keep her £30k salary for continuing to maintain his diary?

Also thinking that if they had a high achieving - oops sorry. aspirational - working Director partnership at a medium sized Football Club they may have got on better.

 

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1 hour ago, essex canary said:

Just a little bit confused about how his now divorced missus is going to keep her £30k salary for continuing to maintain his diary?

Also thinking that if they had a high achieving - oops sorry. aspirational - working Director partnership at a medium sized Football Club they may have got on better.

 

Money spoiled the Linkear marriage?

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16 hours ago, dylanisabaddog said:

Stop trying to confuse LYB. It's obviously difficult for him to understand how someone can possibly be so decent and also be prepared to pay to protect his rights. 

 

straw man.jpeg

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The front of todays EDP features a former village Councillor who has had a years long battle with his compatriots. Following his ostracisatiion from same he files 31 complaints about the Accounts, eventually 27 of them are upheld following District Council support and intervention.  He says the village of 165 people could have saved £15,000 if they had listened. 

A better community hero than Lineker?

 

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On 28/03/2023 at 19:15, Leedscanary said:

I’d say the person receiving the cash in hand and not declaring earnings would be technically more at fault than the payee?

I mean anyone who knows this sort of of stuff will correct me, but I am pretty sure that businesses can be landed in huge trouble if they pay people without invoices, receipts and "off the books" so to speak. In fact, as the BBC is public sector - and run in that way, it is against all policies to do so without a proper paper trail.

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On 31/03/2023 at 11:34, Barbe bleu said:

For last time, I didn't say it was about tax! I don't care why he set up a Partnership, I'm just interested in why he chose to fight. Seems to me that it was only ever going to fund a barristers holiday to mystique.

Daftest question award of the 2022-23 season goes to....

"Why did he fight?" - asked after he won, and didn't have to pay a £45m imaginary tax bill that he would have had to have paid had he not fought.

I mean, if you can't use the benefit of hindsight... 

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5 minutes ago, chicken said:

I mean anyone who knows this sort of of stuff will correct me, but I am pretty sure that businesses can be landed in huge trouble if they pay people without invoices, receipts and "off the books" so to speak. In fact, as the BBC is public sector - and run in that way, it is against all policies to do so without a proper paper trail.

It ought to be that way. Let's hope it is as per my previous posting.

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5 hours ago, chicken said:

Daftest question award of the 2022-23 season goes to....

"Why did he fight?" - asked after he won, and didn't have to pay a £45m imaginary tax bill that he would have had to have paid had he not fought.

I mean, if you can't use the benefit of hindsight... 

Did the HMRC ask him to pay £4.5 million?  My reading was that they believed he underpaid by £6500.   He spent probably hundreds of thousands trying to avoid that bill.

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