Section 660 newsletter warns of a clear and present danger to small firms
Copy of Section 660 information newsletter
This issue relates to the application of existing legislation, known as Section 660, in what some tax experts consider is a different way to how it has been used in the past. It potentially affects every limited company owned by family or friends. The Revenue issued their latest statement last week and since then the UKTECH team have been analysing the detail.
Expert opinion is that it is worse than envisaged and will require millions of small UK companies to assess if they are affected and, if so, consider how they will cope with the possibility of retrospective tax demands for the last 6 years, running into thousands of pounds. For many, who had no knowledge of this legislation now being used in this manner by the Inland Revenue, it will represent an additional worry on top of a very uncertain legislative environment and, for those faced with the actual demands, it could bankrupt them.
We believe that with entrenched positions now drawn via public statements and with the worsening public finance situation, the Inland Revenue will aggressively enforce this measure.
We further believe that it will require a test case to be taken through the courts to reverse what many experts consider to be an incorrect application of existing legislation. As such small business may have to operate for up to three years in a very uncertain environment.
To help you assess if you are affected UKTECH has developed a simple on-line questionnaire which is free and will take less than a minute to complete.
For those that believe they may be affected we have provided a detailed briefing paper, which we are making freely available upon request. Details are provided with the on-line questionnaire.
We will be updating this briefing paper to reflect the latest situation and keeping members of the UKTECH network informed via our dedicated Section 660 information centre.
We cannot stress too strongly to members of the UKTECH network that this measure is a very clear and present danger to their businesses and they should not ignore the need to investigate this matter fully.
We are increasing our resources in this area to offer detailed information, analysis and informed opinion, to help members of the UKTECH network affected deal with this latest threat in the most cost effective manner.
Kind regards
Andy White
Susie Hughes
Kevin Miller www.UKTECH