Family run businesses across Bristol
will be breathing a sigh of relief
this week according to local accountants
Barnes Hunter, following the latest
development in a landmark tax case.
Bristol based Barnes Hunter has
welcomed the news that Arctic Systems
has won its tax case against HM
Revenue and Customs, a decision
that could allow 'husband-and-wife'
businesses to share their tax burdens
instead of facing a huge tax bill.
Mark Hunter at Barnes Hunter comments:
"When Geoff and Diana Jones
of Arctic Systems originally lost
their Section 660A appeal local
business men and women feared they
could face huge tax bills. The news
that their appeal has been won is
therefore very welcome.
"There are still a number
of uncertainties regarding cases
of this nature, for example how
the rules relate to partnerships,
or if the spouse in question did
not actually contribute to the business
at all. However this news is a step
in the right direction and we’re
confident further clarifications
will be made public in due course."
The Court of Appeal found in favour
of Arctic Systems in their appeal
against the previous High Court's
ruling in favour of HM Revenue &
Customs' interpretation of the s660a
settlements legislation. The court
ruled that the dividends paid to
Mrs Jones were not classed as settlements,
as HMRC had claimed.
The case dates back to April 2003
when Arctic Systems, a computer
business run by Geoff and Diana
Jones, was picked out by the Revenue
which claimed the husband and wife
team owed £42,000 in tax dating
back over six years.
The Section 660A appeal, revolved
around the tax regulators' objection
to the way Geoff and Diana Jones,
of Arctic Systems, used their salaries
and dividend payments to reduce
their joint tax bill.
For more information contact Barnes
Hunter on 0117 930 0061.
