Date set for Arctic High Court appeal

The High Court appeal of the Arctic Systems Section 660 case will start on 15 March 2005 and will last three days.

The case concerns Geoff and Diana Jones, of West Sussex company Arctic Systems, who lost their landmark case at the Special Commissioners when the two Commissioners could not agree and one used her casting vote in favour of the Inland Revenue.

The outcome could have massive implications for hundreds of thousands of husband and wife businesses. The case, which has been keenly watched by the small business community, was a blow for the hundreds of thousands of married couples or partners in business together. The Commissioners' decision supported the view that the Revenue was right to pursue tax under the 'settlements legislation'. This means, in the Jones's case, that where dividends are paid to the lower tax earner who wasn't the major fee earner, they could be treated as if they were a payment to her spouse as a higher tax earner. It could result in tax bills of up to £42,000 for many small businesses.

The case is being funded by donations to the Professional Contractors Group (PCG), and the legal and advisory team will include Malcolm Gammie QC and Dave Smith from Accountax Consulting.