Income Shifting

Julia Crouch
Julia Crouch Registered Posts: 68 💫 🐯 💫
I Just thought that I would drop you all a line having just booked some CPD Masterclasses with the AAT.

I pulled off the consultation on the draft legislation from the HMR&C website on income shifting last night and read through it and having just booked into the Taxation Update in London on the 11th April I cannot see anything that could help on this subject sooner.

I am sure that I am not alone with others in having concerns on how we should be advising clients regarding the income shifting legislation that will come into play next tax year. Apart from pay out any profits in dividends before the 5th April and that would not necessarily be good advise!

I do not think that it will be too dificult to operate but It would have been nice to have had some help from the AAT before April.

Thoughts anyone?



  • Dean
    Dean Registered Posts: 646
    Makes a good read doesn't it Julia?

    One thing for sure, DO NOT PANIC! That is just a draft proposal - take it with a pinch of salt currently. I think the final proposal I supposed to be published by the end of next month. We should know more then.

    I will say one thing about the proposal though; the government are trying to be 'cute' with there wording and make it as obscure as possible in the hope to catch 'others' i.e. not just husband and wife. If un-married couples are trading together and decide they want to waive a dividend for one reason or another how can the Revenue force it apon them?

    My example is probably obscure in it's self but i'm just highlighting that some clever clogs at the proposal stage has gone "we won't use the word 'spouse' lets use the word 'individual' in the hope to catch-all", which to me defeats the objectivity of the proposal and opens up another grey area for which tax advisors are left arguing the toss in court!

    Rant over! :001_tongue:

    I've been following this quite closely so i'll let you know more as and when...


  • Julia Crouch
    Julia Crouch Registered Posts: 68 💫 🐯 💫
    Hi Dean

    Thank you for your response.

    I think that I have to be a bit more patient. I did email my AAT area rep but did not get a response, hense this thread to see what general thoughts are.

    I am worried about parties having to be specific within an organisation about their role to justify a payment, as this would imply a contract of employment, and a contract of employment with a director brings them into the grasps of the WTD and the minimum wage regulations..

    I think that it's just another form of easy pickings just like CIS for HMR&C to print off a list and just work down it to catch people out!

    Dont get me wrong I am all for paying fair tax, but not for catching genuine people out!

  • deanshepherd
    deanshepherd Registered Posts: 1,809
    Dean wrote: »
    One thing for sure, DO NOT PANIC! That is just a daft proposal - take it with a pinch of salt currently.

    Never a truer word said!
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