{"id":111,"date":"2007-07-25T16:31:32","date_gmt":"2007-07-25T16:31:32","guid":{"rendered":"http:\/\/www.the-finance-zone.co.uk\/uncategorized\/couple-claim-victory-in-landmark-tax-case\/"},"modified":"2007-07-25T16:31:32","modified_gmt":"2007-07-25T16:31:32","slug":"couple-claim-victory-in-landmark-tax-case","status":"publish","type":"post","link":"https:\/\/the-finance-zone.co.uk\/index.php\/2007\/07\/25\/couple-claim-victory-in-landmark-tax-case\/","title":{"rendered":"Couple claim victory in landmark tax case"},"content":{"rendered":"

A husband-and-wife business partnership have won a landmark tax case against the HM Revenue & Customs (HMRC) in the House of Lords.<\/span> <\/span><\/span><\/p>\n

Geoff Jones and his wife Diana successfully fought a ruling by HMRC that they avoided tax by paying Diana through dividends from their firm. <\/span><\/span><\/p>\n

Victory for HMRC could have seen retrospective tax bills being levied on tens of thousands of family firms. <\/span><\/span><\/p>\n

The House of Lords ruling effectively ends the case, which started in 2003. <\/span><\/span><\/p>\n

The Federation of Small Businesses and accountancy groups welcomed the ruling. <\/span><\/span><\/p>\n

“Clarity had been brought to this issue and it means small businesses will now be able to run their affairs without fear of being classed as tax avoiders,” Chas Roy-Chowdury, head of taxation at the Association of Certified Chartered Accountants (ACCA) said.<\/span><\/span><\/p>\n

The began in 2003, arising when HMRC decided to re-interpret the well-established law on how joint and family-owned businesses should be taxed. <\/span><\/span><\/p>\n

The authorities decided that where a low-earning or non-earning spouse, who is a co-owner of the business, received dividends from their company, that money should be taxed at their partner’s income tax rate. <\/span><\/span><\/p>\n

They argued that Mr Jones had reduced his own salary to an artificially low level, so that he could effectively give his wife a bigger slice of his own earnings, but paid as dividends. <\/span><\/span><\/p>\n

The Joneses faced a tax bill of about \u00c2\u00a350,000. <\/span><\/span><\/p>\n

The couple – from Pulborough in West Sussex – won their argument in the Court of Appeal in December 2005 but the HMRC appealed to the House of Lords. <\/span><\/span><\/p>\n

The House of Lords ruling now draws a line under the case. <\/span><\/span><\/p>\n

However, according to Emily Campbell of City law firm Wilberforce Chambers, which represented the HMRC in the case, the government may have the last say. <\/span><\/span><\/p>\n

“It is very possible that the government will introduce legislation to close this loophole in a future budget,” Ms Campbell said. <\/span><\/span><\/p>\n

“The scheme in this case takes advantage of a loophole…it is not justified and it would be relatively easy for action to be taken,” she added.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

A husband-and-wife business partnership have won a landmark tax case against the HM Revenue & Customs (HMRC) in the House<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"colormag_page_container_layout":"default_layout","colormag_page_sidebar_layout":"default_layout","footnotes":""},"categories":[46,48],"tags":[],"class_list":["post-111","post","type-post","status-publish","format-standard","hentry","category-tax","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/111","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/comments?post=111"}],"version-history":[{"count":0,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/posts\/111\/revisions"}],"wp:attachment":[{"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/media?parent=111"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/categories?post=111"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/the-finance-zone.co.uk\/index.php\/wp-json\/wp\/v2\/tags?post=111"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}