Jane Truelove - HMRC
Donald Carvel - HMRC
Chris Murricane - HMRC
Mike Staples - HMRC
Don Macarthur - HMRC
Martin Delnon - HMRC
Martin Dwyer - HMRC
Chris Edge - HMRC
Phil Hart - HMRC
Mark Frampton - HMRC
Barry Cocks - KPMG LLP
Sarah Robert - KPMG LLP
Amanda Sullivan - BDO
Eleanor Meredith - PwC LLP
Nigel Duffey - PwC LLP
Peter Ashby - Grant Thornton
Matthew Fox - Grant Thornton
Michael Lewis - Deloitte & Touche LLP
Philip Paur - Deloitte & Touche LLP
Phil Davis - Ernst & Young LLP
Steve Wade - Ernst & Young LLP
Martin Taylor - H W Fisher
Mahesh Varia - Travers Smith
Elaine Gibson - IPP
Rosa Tormo - CBI
Mervyn Woods - CBI
Benjamin Wood - CBI
Peter McErlean - BP plc
David Martin - ICI plc
Lucie Holland - Zurich plc
Peter Ashby opened the meeting by giving attendees approximate timings of the various agenda issues.
1. At an earlier meeting HMRC had expressed reluctance to accept schedules which showed expatriates' names and residual liabilities in place of SA Returns. This issue was discussed again on 18 April 2007 and it was left that the CBI would debate this further and make public their views in due course. Mervyn Woods referred to the KPMG report on removing burdens from business and felt that the request that, in certain circumstances, HMRC should accept a global statement of liabilities in place of formal SA Returns fell within the spirit of this report. However, it was accepted that the ball remained in the CBI’s court and it was agreed that they would invite further representation and come back to the Forum with comments in support of their proposals in due course.
2. Martin Delnon confirmed that the IR212 helpsheet had been issued subsequent
to the previous meeting but that no feedback had been received. The meeting
confirmed that this issue should now be regarded as resolved.
3. Ernst & Young LLP had provided a response on behalf of the Big 4 to Martin Dwyer dated 21 August 2007. This had been referred to Jane Truelove for her comments. Jane reminded the meeting of matters discussed on 18 April 2007 relating to the interpretation of the new US/UK Double Taxation Convention and the more limited circumstances where foreign tax credit relief was now available. As was reflected within the note of the previous meeting, a number of enquiries had been opened by CPTT to test whether or not the foreign tax credit relief claims made were competent and/or accurately computed. One of the issues under enquiry was whether or not relief was available in the US under Article 14(2) and if so, how this impacted on the foreign tax credit relief claimed in the UK.
4. Although the information provided by Ernst & Young LLP had been relatively recent, Jane Truelove has been assembling information from within HMRC and now has a variety of scenarios to use as examples in direct correspondence with the IRS. Jane explained that HMRC still have concerns with regard to the interpretation of the treaty by the US and that she intends to channel enquiries for clarification through the US Embassy. Martin Dwyer suggested that those representatives of the Big 4 who had already made enquiries of Linda Gerrard at the US Embassy could lobby her to ensure that Jane's requests for clarification are directed to the appropriate person in the US and are handled with some degree of urgency.
5. Jane Truelove suggested that once HMRC have the clarification they require they will review the interpretation of the treaty accordingly. She made the point however that if the definitive US position was established to be as indicated by the Big 4, there could be no guarantee that the UK would accept this as representing a reasonable interpretation of the intention of the treaty.
6. As far as the open Section 9A enquiries were concerned, it was agreed that CPTT would ensure that this particular issue was ring fenced and set aside until such time as the necessary clarification had come from the IRS and had resulted in further guidance from CAR Residency. However, where other issues were being pursued, enquiries would continue to obtain the necessary information to resolve these.
7. Jane Truelove explained that agents had previously asked for clarification of what white note space entries could usefully be included to ensure that Section 9A enquiries of this nature were not considered appropriate. At the moment it was difficult to see whether any such messages would be effective. However, it was agreed that once the position of the IRS had been made clear and in turn, HMRC had considered its response in light of the specific examples to be quoted, advice would be given to agents if it was felt that helpful white note space entries would mean that a case should be regarded as carrying less risk for HMRC.
8. Following the meeting of the Joint Forum, HMRC have written to the IRS - on 31 August 2007, to request their clarification of the treatment they would apply in a variety of scenarios. It is hoped that a full response on these will provide sufficient background to help HMRC understand the approach taken domestically in the US and formulate a way forward. In the meantime guidance has been issued within HMRC’s Complex Personal Tax Teams to confirm that this specific aspect of open S9A enquiries should be suspended temporarily pending the outcome of the exchange with the IRS.
9. Mervyn Woods explained that the first five-year review of the US/UK treaty was imminent and that if disagreement between the UK and the US on this issue continued, it may be possible to have this discussed as part of the review.
10. Barry Cocks of KPMG LLP asked for confirmation of what HMRC expected to be included on the 2006-07 SA Returns. Jane Truelove explained that such Returns should be filed on the basis of the agent's current understanding.
11. Jane then referred to the suggestion within the Ernst & Young LLP email that HMRC would argue that any credit for US tax should be restricted to the tax - if any, that would be due if the doubly taxed income was the only income subject to US tax in the year. Jane Truelove explained that, although she was aware that this had been suggested in some cases, it did not represent HMRC practice.
12. At the previous meeting held on 18 April 2007 Ishbel Huggins at Shell International Limited had queried why HMRC required a SA Return in circumstances outlined within the Q & A exchange associated with that meeting. Arrangements had been made for a meeting to be held between CPTT and Shell to debate this issue further but unfortunately this had been postponed at Shell's request. It was agreed that this issue would be deferred to the next Expatriate Joint Forum, by which time, hopefully, this meeting will have taken place.
13. Matthew Fox of Grant Thornton had raised an issue previously regarding NT codes but had not followed this up by referring specific cases to Shirley Davies of CPTT as invited. Matthew explained that shortly after the previous meeting the cases which were causing him concern had been resolved and he was content for this issue to be regarded as closed.
14. At the previous meeting Don Macarthur had agreed to take away requests that historic Q&A logs should be published on the web. He repeated that HMRC are keen to ensure that the details of past agreements are made readily available but there are numerous difficulties which needed to be overcome to implement this in the manner suggested. Mervyn Woods explained that businesses and agents alike had been asking HMRC to ensure that its guidance regarding handling expatriate tax issues should be brought together so that it was easily accessible in one place. Michael Staples of ESSU explained that it was HMRC's intention to keep its manuals up to date to reflect current thinking and that this was preferable to the posting and updating of Q&A logs. HMRC resources were being devoted to updating manuals. Mark Frampton explained that the NI manual had been criticised over its international content as this was seen to be too complicated and specialised. HMRC were now thinking about separating out this international content and making this available to agents and large employers who deal with expatriate issues. Mark and his colleagues are working to produce a product aimed at CPTT staff covering their customers.
15. Don Macarthur supported the idea of improving guidance generally rather than just maintaining Q&A logs. HMRC colleagues would however need to identify the appetite for and the resource needed to produce definitive expatriate guidance within HMRC. He would take this away and feed back at the next meeting.
16. At the previous meeting John Weaver had handed out a copy of the NIC grossing formula and had requested feedback or comments regarding this. The Q & A log contained details of an exchange between Martin Benson of Baker Tilly and Martin Dwyer which confirmed that businesses could continue to use the Tolley's calculation for NIC grossing, despite the fact that this produced a different answer to the HMRC version. Martin Dwyer confirmed however that where HMRC identified additional unreported liabilities, they would calculate the NIC grossing by reference to the HMRC formula.
17. Both Philip Paur of Deloitte & Touche and Mervyn Woods explained that it was unhelpful to have two versions of a formula which gave different answers. Mark Frampton explained that the HMRC formula was indeed more complex than that used by Tolley's but was based on Counsel's advice. Mark again invited feedback regarding the HMRC formula which he confirmed would be fully considered before any decision was taken by HMRC to indicate a definitive approach which employers must follow.
A copy of the updated Q & A log was handed out and no specific questions on these were raised.
Peter Ashby explained that the subject of accountancy fees relating to tax preparation work in connection with tax equalisation cases was an issue which he had been trying to resolve on an across the board basis for many years. Martin Delnon explained that HMRC were not minded to agree a round sum benefit applicable in all cases. There were a variety of reasons for this, not least that fees charged from employer to employer were likely to differ.
Martin Dwyer explained that, in his experience, accountancy fee services were part of a bundle of services provided by agents on behalf of their clients. Whilst HMRC were happy to accept that much of what was provided within the bundle is done for the benefit of the employer, it remained HMRC’s view that a benefit-in-kind did exist and hopefully, agreement could be reached regarding that proportion of the bundle costs which related to the tax return preparation service.
Martin Dwyer pointed out that he had been in correspondence with Ernst & Young LLP in this regard, in particular to address the possibility that given the need to compete in the market place, bundle costs may well reduce and HMRC were content to confirm that where the evidence supports this, the benefit-in-kind to be reported would reduce accordingly. Dwyer suggested that he could include, within the minutes of the meeting, extracts from correspondence he had issued to Ernst & Young LLP which might be helpful in this regard. Phil Davis of Ernst & Young LLP confirmed his agreement to this approach.
Extracts from the relevant correspondence are contained within Appendix 1 to these notes.
Martin Dwyer made it clear that whether or not the bundle of services included Section 9A work should be capable of establishment by reference to the documentation. Where Section 9A work was not included within the bundle then HMRC would continue to argue that a benefit was provided to an employee where such costs were met on his behalf. Whilst HMRC acknowledged that this view was not universally accepted, they would be prepared to refer any contentious appeals to the Commissioners, where appropriate.
Peter Ashby explained that currently a cash basis for taxing bonuses is available but must apply consistently across a programme. However, against a background where each individual must file accurate SA Returns, he questioned whether or not a concessionary cash basis was legally justifiable. Martin Delnon confirmed that IR212 made reference to the availability of cash basis. Cash basis was wholly concessionary and following the Wilkinson case, HMRC would be reviewing both formal concessions and concessionary practices. It was by no means clear whether the cash basis could continue to be justified.
Philip Paur confirmed that Deloitte & Touche LLP had not used the cash basis much over the last few years, mainly due to the lack of symmetry in treatment with other fiscal authorities. He acknowledged that the availability was limited to tax-equalised cases. From a Deloitte & Touche LLP perspective, they had more concern with determining what year a bonus was for and suggested that this could be made obvious by the use of signed elections made by employee and employer. Steve Wade confirmed that Ernst & Young LLP do use cash basis but not for US taxpayers.
Martin Dwyer explained that his experience suggested that the use of the cash basis was not always limited to tax equalised cases and some Employer Compliance reviews had found that employers had used this basis where no tax equalisation applied.
Martin Delnon explained that the correct statutory approach for determining whether earnings are taxable is to establish the period that the earnings are 'for' by reference to the facts. He was increasingly aware of differences in the positions taken by HMRC and tax practitioners in relation to awards made under various types of Long Term Incentive Plan. Where entitlement to receive an award depends on the employee satisfying specified conditions, HMRC generally takes the view that the earnings do not accrue on a day to day basis. The UK taxation position will therefore depend on the employee’s residence status and the location of duties in the year when entitlement crystallises. HMRC will adopt this approach unless the facts support the view that the award accrues over another period.
Philip Paur explained that Deloitte & Touche LLP had taken external advice which suggests that the conditional element is not determinative but simply one of a variety of factors for consideration. Steve Wade of Ernst & Young LLP pointed out that acceptance of the HMRC view provided difficulties with interaction with other fiscal authorities. Phil Davis of Ernst & Young LLP explained that most problems related to 'bad leaver' provisions but the Big 4 generally take the view that it is not reasonable to argue that such awards are earned on the day when the entitlement crystallises.
It was obvious that there were differing views around the table, particularly between HMRC and tax agents and it was agreed that this should be the subject of further discussion in advance of the next meeting. It was also agreed that this further discussion should include the NIC treatment.
It is intended to hold a meeting to discuss this matter further in London on 18 October 2007. If any Forum member wishes to be involved please send an email to lindsey.williams@hmrc.gsi.gov.uk by 12 October 2007 and details of the time and venue will be provided.
Don Macarthur reminded members of the co-Chairmen’s strategy of maximising time spent on productive discussion at forum meetings. One aspect of this was the idea of focussing on two or three specific issues as they had done on this occasion and would repeat.
The co-Chairmen also felt that keeping meeting numbers within manageable bounds was important. Don thanked the agents for playing their part in this by sending no more than two representatives per firm. Don also reminded the meeting that it was representative bodies rather than individual employers who should provide delegates. Martin Dwyer was concerned that there may be some industries, particularly the financial sector, who felt that they were not represented at this forum. Since these may represent a significant part of CPTT's customer base, it was important to him to ensure that they had the representation to which they were entitled. Don Macarthur mentioned that he had had a similar request from an oil company. Mervyn Woods confirmed that the financial and oil sectors were indeed represented by the CBI and indeed provided representatives for other forum meetings with HMRC. Dwyer made reference to a discussion he had had with Nigel Duffy of PwC LLP where it appeared that certain businesses operating in the financial sector did not appreciate that such representation existed. It was agreed that Nigel Duffy would report back to these sources accordingly.
The possible dates and venues for the next meetings of the Joint Forum on Expatriate Tax & NICs were discussed. These are now confirmed as:
Wednesday 5 December 2007
Thursday 28 February 2008
Thursday 22 May 2008
Thursday 18 September 2008
Don Macarthur explained that Peter Robinson wants to consult with stakeholders generally regarding the way forward as the implications of the Demibourne judgement were both complicated and wide-reaching. Peter planned to address the area generally at the next meeting of the Employment Consultation Committee on 12 September, and would then be interested in following up particular issues relating to specific customer segments or topics such as expatriate taxation, to ensure that these were covered.
Don Macarthur invited email contact for participation at this meeting. A written note setting out the outcome of the meeting will be shared with the Joint Forum in due course. don.macarthur@hmrc.gsi.gov.uk
Don Macarthur explained that HMRC were looking in general to widen the use of dispensations and PSAs as this can help to reduce time and trouble for both employer and HMRC alike. Don was trying to increase awareness amongst employers of the availability of dispensations and PSAs and would be using various media opportunities to do so.
He confirmed that it was not HMRC strategy to use a dispensation request as a reason for an audit. Any instances where this was felt to be the case should be referred to him. HMRC were considering how many questions were appropriate where a dispensation request was made. The hope was that most dispensations would be granted without enquiry but, of course, if HMRC has identified risks in the customer concerned or in a specific sector, these may well result in questions being asked before a dispensation can be granted. Don Macarthur confirmed that HMRC do see the dispensation as providing benefits to them and to employers alike.
Phil Davis of Ernst & Young LLP suggested that a change to the law to allow agreed rates for inward expatriates would be welcome. Don Macarthur explained that HMRC had been speaking with representatives of the Foreign & Commonwealth Office with respect to the publication of agreed rates for overseas secondees. This was with a view to HMRC accepting that such rates should be allowable across the board. Unfortunately, however, the Foreign and Commonwealth Office were not prepared to allow their regularly updated information to be published widely without making a charge.
Martin Dwyer explained that one of the frequent difficulties faced by his teams when looking at dispensations was the accurate quantification of scale rate payments. Where a dispensation request includes scale rate payments, it is highly likely that evidence will need to be seen to show that the quantum of the scale rate to be included within the dispensation is reasonable and that the expense has been incurred.
Martin Dwyer handed out a draft Q&A exchange which followed a meeting held between HMRC and Big 4 representatives on 14 May 2007. He explained that the note of this meeting had yet to be finalised but that it was his intention to make the note widely available to Forum members once this has been achieved.
Barry Cocks pointed out that Question 7 within this draft makes reference to an accompanying letter which was not provided in the handout. Martin Dwyer confirmed that he would attempt to obtain a copy of this and publish it with the minutes of the meeting in due course.
HMRC are currently awaiting agreement from the Big 4 before we can make this accompanying letter available to members of this Forum.
Peter Ashby reminded the meeting that there was a Share Scheme Sub committee dealing with share schemes issues as they affect expatriates. This Sub-committee last met in May and covered legislation within Chapter 3C. There had been a lot of correspondence exchanged since then and in the near future, Peter Ashby will publish a final version of the covering note summarising what has been agreed. The next meeting of the Share Schemes Sub-committee would be held in September 2007 but a date has not yet been agreed.
The summary note is contained at Appendix 2 below.
Chris Edge explained that currently P11D online filing required a National Insurance number to be entered on the system. For next year (2007-08) employers must give details of the gender, date of birth or National Insurance number to facilitate online filing. It is hoped that this will facilitate the online submission of P11D information in cases where a National Insurance number is not available.
Martin Dwyer made reference to comments made at the previous meeting by Steve Wade of Ernst & Young LLP where he had identified certain difficulties associated with online filing of SA Returns. Steve Wade confirmed that he had compiled a list of things which the online system appeared unable to cope with and which could often result in the crashing of the online filing system. It was agreed that Steve Wade would pass this information to Don Macarthur for him to take forward and resolve.
1. Peter Ashby explained that the new EP Appendix 6 modified PAYE arrangements appeared to contain quite rigid rules. He had discussed with Martin Delnon certain circumstances where it was felt that no harm would be done by allowing EP Appendix 6 to extend to certain individuals who would otherwise not meet the full requirements set out within the Tax Bulletin article. Martin Delnon said that there were some instances where rigid application of the rules could be relaxed. He intends to add some suitably worded frequently asked questions to those already in existence and to insert these in the EP manual. Martin requested Forum members to provide any additional modified PAYE related questions to him with this in mind.
2. Chris Edge explained that Shirley Davies was shortly to arrange a meeting about the impact of Carter and MPPC and would be contacting stakeholders as necessary. The meeting has been arranged for 11 December 2007 in Euston Tower London. There was also news regarding global payments which meant that a slight change to the arrangements would be introduced for next year. This would result in HMRC being provided with a copy of the spreadsheet used in this connection to facilitate queries raised by Accounts Office.
3. Finally, Chris Edge handed out a questionnaire requesting customer feedback regarding its Quality Measures. CPTT are keen to ensure these meet customer needs and expectations.
Response to this request for feedback has been disappointing. If you have not yet returned your questionnaire to Chris please do so by email to; christine.edge@hmrc.gsi.gov.uk.
Download electronic version of the questionnaire.
Appendix 1: Extract from correspondence between HMRC (CPTT) and Ernst & Young LLP regarding accountancy fee benefits.
When we met, you pointed out that when a Big Four firm such as yours bids to a prospective employer client for business, you may well calculate the bid on a ‘per head’ basis, but the amount will cover a range of services, of which providing tax advice and Tax Return preparation form only a relatively small element. Although this ‘bundle’ of services may be described within your bid and any subsequent letter of engagement, as the provision of Tax Return services, this may be something of a misnomer as the bundle may include:
We can accept that much of what is described above is done for the benefit of the employer and that it would not be reasonable to argue that the full cost of the bundle on a ‘per head’ basis constituted a benefit in kind assessable on the employee, irrespective of how the bundle was described in the letter of engagement.
However, we remain of the view that some of what is described above is for the personal benefit of the employee and will continue to expect that Self Assessment Tax Returns and forms P11D will reflect a benefit in kind and will make enquiries where this does not occur.
Historically, we have been able to agree levels of benefits in kind on an employer by employer basis, whether as a result of intervention through an employer compliance review or by acceptance of the levels of these benefits included by your firm on the employee and employer Returns submitted. Following our discussions, we hope that this approach will continue.
We recognise that you have indicated that competition in the market place means firms such as yours may need to offer a similar bundle of services for a lesser ‘per head’ fee and that against this background, it is unreasonable for HMRC to be continually looking to increase the levels of previously agreed benefits, by reference to indices such as inflation.
I have made the six Expatriate Teams aware of this view and asked them to seek sight of available evidence on a case by case basis, if they are looking at this particular benefit in kind. If we have previously agreed a level of benefit relating to Tax Return preparation and are now revisiting this as part of a current review, it is reasonable to establish and take into account any significant factors.
In such cases, it should be possible to find out by reference to documentation the ‘per head’ cost of the bundle of services provided at the time the benefit was previously agreed or accepted and consider the proportion of this cost that was reported as a benefit in kind. If the cost of providing such services has now declined due to market forces, it should be similarly possible to evidence this by reference to more recent documentation. If such evidence is produced, it should in turn be possible to quantify a reduced benefit in kind, by reference to the previously established proportion.
In short, we accept that where the range of services provided by your firm remains broadly unchanged but the ‘per head’ cost declines, it is entirely possible that the benefit in kind element will reduce. However, you will need to support any such contentions in actual cases with the relevant documentary evidence.
When we met, you indicated that in your view, it is the employer rather than the employee who benefits from resolving any S9A enquiry, as it is they who must contractually resolve any additional liabilities arising. You suggested that when your firm responds to a S9A enquiry in a tax equalised case, you are acting on behalf of the employer and not the employee.
You referred to the cases of Westcott v Bryan (45TC476) and Rendell v Went (41TC641) and contended that as the employee remains insulated from the outcome of the enquiry by virtue of the tax equalisation arrangements in existence, no benefit is conferred or enjoyed through the provision of accountancy services related to the S9A enquiry.
The HMRC view is that a benefit is clearly provided to an employee in these circumstances. The enquiry is into the personal SA Return of an individual and any additional liability arising is recoverable, by law, from that individual, despite the contractual arrangements between employer and employee.
The case of Rendell v Went established that a benefit is no less a benefit, just because the employer may not have as his motivation the provision of a benefit. It is our view that in a tax equalised case where the employer takes on the responsibility of resolving the S9A enquiry, a benefit is indeed provided to the employee. Whether or not that is the employer’s intention is irrelevant.
The case of Westcott v Bryan concerned apportionment of a benefit, in which the judge was asked to (but declined) to come up with a formulaic solution to calculating the apportionment. He ruled that the split of the benefit should reflect the facts. We will attempt to establish the facts and consider whether any apportionment is appropriate.
Where we find evidence to indicate that the costs of accountancy services related entirely to resolving the S9A enquiry, we will regard these costs as giving rise to a taxable benefit in kind. If your clients are unable to accept this treatment, we will need to refer an appropriate case to the Commissioners.
1. It is HMRC practice not to apply a 3C charge to the exercise of options granted whilst the employee was not resident and not ordinarily resident and the grant was not in respect of UK duties. The legislation would, of course, in strictness, allow us to take such a charge.
(PA comment) - It is not clear whether this concession would hold in a court of law (and it seems to me it would not) so it looks as if HMRC are saying that until there is a review of the residence and domicile (as promised by the 2003 budget) then they will be trying to keep the changes from the old ITEPA and the new ITEPA as inserted by FA 2003 as simple as possible until the review was completed. Going to court to challenge this point would almost certainly result in the courts extending the legislation to all securities options acquired in the UK regardless of the circumstances at grant/award.
This is not a change in the law, but it was potentially a change in the interpretation of the law.
2. You will be aware that the OECD consensus is that share options are considered to be earned between the dates of grant and vesting rather than in a period up to the date of grant. HMRC's view that an option is generally granted in respect of duties from the date of grant is in line with this consensus.
(PA comment) - All HMRC are doing here is to state their default position. They can accept that the period of reward would be different if the facts support this. For example, if the options were granted across the board as a reward for an excellent years results with a discount from MV, that would make it retrospective to some degree, particularly if they were immediately vesting ones. However, it seems that a US style 3-10 year option will be earnings for the 0-3 year period from grant to vest.
3. If an option is granted to a non UK resident employee which vests immediately, he returns to the UK permanently and exercises it when resident in the UK; HMRC would accept that this was not granted in respect of UK duties.
(PA comment) - Rare but clear. This is definitely a concession of what the law says but I believe all HMRC are doing is linking the acquisition of the shares to earnings that would be outside the scope of UK tax, thus making the Chapter 3 C charge exempt too.
4. An option is granted to a non-UK resident employee which vests in 3 years' time but has no conditions involving continuing employment, performance, etc. The facts of each case would be decisive, but the presumption would be that, regardless of the time subsequent to the grant that the employee returned to the UK, or when it was known that he would return to the UK, the grant of the option was not in respect of UK duties.
(PA comment) - I assume the key here is that there are 'no conditions involving continuing employment' ,ie, the ownership of the option/right does not depend upon the UK employment but exists independently from it. I therefore assume that if an employee has been granted an option as in this point, and the option would have to be exercised if there was a cessation of employment within a window after the cessation, there could be UK tax if the option vests after his return. If the option survives the cessation of employment ,ie, it is not forfeited when employment ceases - and some do, then the case for no link can be made.
5. The decision to exclude the Part 7 charges from ESC A11 arose from the High Court ruling in Wilkinson. Following that ruling, it was felt that concessionary treatment should not be extended to new legislation.
(PA Comment) - I think the Wilkinson case says that where the law is clear, then HMRC have no statutory power to change the law. HMRC may give an Extra Statutory Concession where the law is unclear. They may choose not to collect the tax where the cost of doing so outweighs the tax collected. But they cannot override the intention of Parliament as set out in statute as they do not have the power to do so. I'm not sure it's anything to do with new legislation but the thought process may be that new legislation by definition will have thought of everything!
Peter Ashby CTA
Martin Dwyer
