Section 660 win for Qdos consulting

Contractor Insurance

A freelance IT contractor has been subjected to a Section 660A investigation and won. Section 660 - the so-called business tax between married couples and partners - has been the subject of much controversy and uncertainty since the Revenue started clamping down on what it perceived to be a 'loophole'.

This case concerns a small family company, with an annual turnover of a little over £100,000, run by a husband and wife who are the only shareholders. The investigation began in September 2003, with an enquiry into the wife's personal Tax Return. The Revenue's questions originally concerned remuneration, then quickly turned to investment income. The company's accountant suspected that a Section 660A investigation was afoot, and he advised the Company Director to consider dissolving his company and forming a new company with a different share structure. This was a signal for the director to contact Qdos to claim on his tax investigation insurance policy.

The case was allocated to Keith Preece, one of Qdos' Senior Tax Consultants who wrote to the Revenue, providing the information that the Revenue had requested, concerning the wife's shareholdings and remuneration, and giving the Revenue a comprehensive account of the wife's involvement in the business.

Two months elapsed and having sent a reminder back came a letter: the case had been submitted to the Inland Revenue Trusts Director's office at Bootle, where the Revenue's Section 660A "Technical Adviser" resides. Another fortnight passed by and the Revenue wrote again: the investigation had been dropped. Relief all round! Fortunately they were insured with Qdos Consulting.

Source: Shout99

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.


Alliance Accountants

Published: Wednesday, May 12, 2004

© 2014 All rights reserved. Reproduction in whole or in part without permission is prohibited. Please see our copyright notice. If you want to use any content you have seen on this site then please request our media pack and ask for details of our Content Licencing Service.

  
  

Inni Accounts


Readers Comments...


  
Bookmark and Share
  
     
  

Section 660

Related Guides

Section 660

  
  

Latest Site Updates

ContractorCalculator: Contracting news in brief – 17/Apr/2014 ContractorCalculator: Contracting news in brief – 17/Apr/2014

News this week covers: financial sector recovers; PCG calls for greater contractor support; new powers for HMRC; & late-payment code in construction.

Contractor guide to using substitution to stay outside IR35 Contractor guide to using substitution to stay outside IR35

Contractors who are able to make unfettered substitutions that do not require agreement from the client can use substitution to stay outside IR35.

Contractors and trade unions – can they be compatible? Contractors and trade unions – can they be compatible?

Contractors are independent professionals and also self-employed. Trade unions claim to be all about representing workers? Is there a meeting point?

Financial, HR and IT contractors benefit from London financial sector job surge Financial, HR and IT contractors benefit from London financial sector job surge

IT, HR, compliance and risk specialist contractors are benefitting from a surge in job vacancies, against a background of improving City health.


  
  

Twitter

  • Finance is number in the league table of sectors where IT is growing fast http://t.co/G6sTiNftwB via @siaeurope

    12 hours ago

  • ContractorCalculator is now on Facebook, so if you wish to receive the latest contracting news connect with us today https://t.co/pPMQmQSmAL

    14 hours ago

  • Institute of Interim Management 2014 IIM survey is open contractors to complete and will run until 10 May 2014 http://t.co/BQtVrRipAQ

    17 hours ago

  • ContractorCalculator: Contracting news in brief – 17/Apr/2014 http://t.co/JhNa9rsArf

    18 hours ago

  • Self-employment increases by 146k over the last quarter, shows latest labour market stats from ONS http://t.co/6Hjh6app73

    Wed, 16 Apr 2014

  • Contractor guide to using substitution to stay outside IR35 http://t.co/Cf0lbR4Il9

    Wed, 16 Apr 2014

Follow Us On Twitter


  
     

  
  

Contractor solutions

Contractors Handbook Orange and Gold Accountancy Limited IR35 Test Clever Accounts Accountants Checklist Contractors Handbook
  
  

Contractor solutions

Contractor Accountant

Free consultation, incorporation and IR35 reviews. Find out more…

Clever Accounts

Complete contractor accounting service. 24/7 online access. £69 pm!

Parasol

We can help you make the most of your money

Contractor Angels

More than just an Umbrella. Retain up to 90% of your earnings.

Alliance Accountants

Complete Accountancy and Taxation service from £55 per month

InTouch Accounting

Perfect mix of technology & personal service for only £92 per month.

NA D J Colom Accountants Bedouin Group Contractor Financials NewsNow
  
Caprica Accountants Contractor Insurance Life Insurance

  

The UK's leading contractor site. Independently audited traffic (ABC) – 123,165 monthly unique visitors.