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Mindreaders required

23 March 2006 / Allison Plager
Issue: 4050 / Categories: Comment & Analysis , HMRC powers , Admin , Capital Gains , Companies , Losses , Trusts , VAT
A panel of expert contributors (and Rufus the dog) give their first reactions to what may be Gordon Brown's last Budget speech.

BUT HOW WILL they know?' It's the question every tax adviser dislikes answering. You explain to the client that if (for example) they spend more than 183 days in the UK in any tax year they are automatically UK resident and the response is 'but how will they know?'
More often than not the answer is 'because I will tell them'. But it is just as likely that you can give practical reasons to back up an ethical stance: your credit card statements will show where you spent money HMRC can request mobile phone records someone will inform on you.
One of the characteristics of this Budget seems to be that several new provisions either rely on taxpayers being exceptionally forthcoming about their motives or on HMRC getting mindreading courses from Derren Brown. There is a motive test for the employee securities legislation ...

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