Mis-sold or mis-managed Tax mitigation schemes?

We are an award-winning team of solicitors who specialise in professional negligence and financial mis-selling claims. We use our many years of experience and knowledge in this area to obtain and scrutinize relevant documents from financial advisers, stockbrokers, CFD providers and other associated entities.  Using our specialist knowledge of the law of contract and negligence we identify any grounds for action. We submit written complaints, detailing every allegation and are successful in most of our cases.

We are an award-winning team of solicitors who specialise in professional negligence and financial loss claims. We use our many years of experience and knowledge in this area to obtain and scrutinize relevant documents. Using our specialist knowledge of the law of contract and negligence we identify any grounds for action. We submit written complaints, detailing every allegation and are successful in most of our cases.

If you can successfully show that a tax saving scheme or plan was mis-sold to you then you can seek to recover an amount of compensation that puts you in the position you would have been in had no wrong been done.

This can include the capital losses you have incurred as a result of investing into a plan which has since been classified as a tax avoidance scheme, along with any penalty fees that may have been imposed by HM Revenue & Customs. Interest on these sums can also be claimed.

The level of losses that can potentially be suffered as a result of being mis-sold a tax mitigation product can be very significant. Neglect Assist can investigate and advise upon the level of loss suffered and may be able to represent you in a no win, no fee claim.

We offer an absolute and guaranteed No Win, No Fee agreement, it’s that simple. If successful, we take a fee of up to 20% (plus 4% VAT) * Of the award of compensation. If unsuccessful, our clients pay us nothing.

Many of these products came with a high level of risk that future tax liabilities may be incurred. These risks were not always adequately explained to investors.

Income tax is paid at various thresholds depending on the level of an individual’s income. This starts at a basic rate of 20% and rises to as much as 45% on any income exceeding £150,000.

Certain financial losses that may have been suffered by an individual over the course of a tax year can be offset against income, thereby reducing the level of income tax liability.

This principle is usually of particular interest to wealthy individuals who fall within the higher levels of income tax brackets because a financial loss can significantly reduce the amount paid in annual income tax.

It is fairly common for wealthy individuals to seek guidance from a financial adviser or wealth management company on tax planning strategies. There is nothing improper in doing this, and in many situations it is prudent to do so.

However, in recent years some financial advisers and wealth management companies have been recommending investments into tax mitigation schemes as part of a tax planning strategy. Many of these products came with a high level of risk that future tax liabilities may be incurred. These risks were not always adequately explained to investors.

At a basic level, money is placed into a product or scheme where losses are likely to occur. If such losses do materialise, the intention is that they can then be offset against other income and therefore reduce the amount of an individual’s income tax liability.

The problem here is that it is not permitted to deliberately place money into a loss making scheme so as to reduce a tax liability.

HM Revenue & Customs have issued legal challenges on the validity of such schemes and, in many cases, have succeeded in demonstrating they amount to tax avoidance schemes.

When this occurs, HM Revenue & Customs then have the power to serve the individual involved with a tax demand to reclaim what should have been paid. This is occurring more frequently and it is estimated that approximately 64,000 demands of this nature will be served by HM Revenue & Customs by the end of 2016.

These tax demands are usually for significant sums given the higher tax thresholds that the individual investor is usually subject to. Furthermore, it is common for HM Revenue & Customs to impose a penalty fee due to the nature of the scheme.

The additional amount claimed by HMRC can also span back over many years. For example, someone who invested in a loss making scheme in 2005 could now potentially receive a tax demand for sums owed over a 10 year period.

All of this combined can leave the individual investor facing devastating financial losses. Some high net worth individuals have lost sums running to millions of pounds, and in one particular case the loss could potentially reach as much as £7 million.

Financial advisers and wealth management companies should have appreciated the level of risk that incorporating a loss making investment into a tax planning strategy could have. These risks should have been explained to their clients as in many cases such investments were wholly inappropriate.

If you have received a tax demand relating to an investment made into a tax mitigation scheme or are concerned about the advice you received on such an investment, then we may be able to help you bring a no win, no fee claim.

Financial advisers and wealth management companies typically have indemnity insurance or other funds to cover the cost of such claims.

If you;

then we may be able to assist you in bringing a No Win No Fee claim for compensation.

How does a tax mitigation plan or scheme operate?

Money is invested into a product or scheme where losses are likely to occur. If such losses do materialise, the intention is that they can then be offset against other income and therefore reduce the amount of an individual’s income tax liability.

How are losses suffered on a tax mitigation schemes and products?

It is not permitted to deliberately incur financial losses so as to reduce the amount paid in tax. HM Revenue & Customs have brought legal actions to have many schemes of this nature declared invalid and be classified as tax avoidance schemes.

Individuals can be served with tax demands, which can include significant penalty fees and charges, if they are deemed to have invested into a tax avoidance scheme. The potential financial losses suffered as a result can be very significant.

How much am I entitled to?

If you can successfully show that a tax saving scheme or plan was mis-sold to you then you can seek to recover an amount of compensation that puts you in the position you would have been in had no wrong been done.

This can include the capital losses you have incurred as a result of investing into a plan which has since been classified as a tax avoidance scheme, along with any penalty fees that may have been imposed by HM Revenue & Customs. Interest on these sums can also be claimed.

We can investigate and advise upon the level of loss suffered and may be able to represent you in a No Win No Fee claim.

What do we charge?

We offer an absolute and guaranteed No Win, No Fee agreement, it’s that simple. If successful, we take a fee of up to 20% (plus 4% VAT) * Of the award of compensation. If unsuccessful, our clients pay us nothing.

* We reserve the right to apply a deduction in more complex or higher risk cases of up to 30% plus VAT. Typical examples might be where there are multiple parties to claim against, where time limits for claiming may have passed or new areas of law are tested.

What if my claim has already been rejected?

We will still look at this for you.

Will I have to fill out loads of paperwork?

No, we will be able to do most of the necessary paperwork for you and we can obtain any relevant documents on your behalf. You will have to check the details of your claim before it is submitted, but we will assist you with this.

What do I do now?

Call or email us. There is absolutely no obligation to proceed and if you tell us what’s happened, we will briefly explain if we think you have a claim and the procedure for filing a claim and the time limits that apply.