HM Revenue and Customs is to take the Arctic Systems case to the House of Lords in an attempt overturn last Decembers win at the Court of Appeal.
The case is based around tax law referred to as Section 660a, which could see husband and wife companies paying thousands more in tax.
Tens of thousands of partners using company dividends to reduce their joint tax bills could now face retrospective bills of up to £9,000 each.
The announcement came at the eleventh hour to go ahead.
For an examination of the potential cost see ‘How Much Could Section 660 Cost You’.
You can also calculate how it could affect you personally using the Section 660 Calculator.
Source: Telegraph - Arctic Systems husband and wife ruling challenged
Editors note (Feb 2012):
The original settlements legislation dates back to the 1930s and was subsequently updated first in 1988, when it became the more familiar Section 660. It was changed again in 2005 when it was updated and rewritten into its current form as Section 624 of the Income Tax (Trading and Other Income) Act (ITTOIA) 2005. See more information on the current settlements legislation.
Published: Monday, January 16, 2006
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