LCAG Litigation Action
Donation protected
LCAG Litigation
This crowd funder has been set up to collect contributions to the litigation which LCAG are taking forward. We asked everyone who is registered with LCAG to give their opinions on the next steps for the litigation journey, and over 90% of people who voted agreed this was the right way forward. This was an overwhelming endorsement that our proposal should proceed.
Summary of the Action
The basis on which we would take the case to the FTT will be on both the European law argument used in Scotland and England, but also additional PAYE arguments which strengthen our case further. Some of these arguments come off the back of the cases of Lancashire and Hoey.
In the FTT for “open years”, the arguments would be:
1. European law applies – effectively, the Loan Charge amounts to an interference with the free movement of capital between European Member States and, in any event, constitutes a disproportionate penalty.
2. By applying the Agency Rules are not liable to tax because they have to allow a tax credit
The argument against the Loan Charge would be:
1. European law applies – as above.
2. Reliance would be placed on ITEPA 2003 s.554Z6 . The argument that the payment by the agent is following Rangers a payment of earnings by the agent. These are relevant earnings which reduce the Loan Charge to nil.
3. Alternatively, reliance is placed on s.554Z5. If the agency is the employer, the umbrella company is not the employer. If that is wrong and you can have two employers, then s.554Z6 applies also to the umbrella company. The loans were payments of earnings. If you can only have one employer, the payment of a loan by the umbrella company means PAYE should have been deducted by the umbrella company. The contractor is entitled to a tax credit and so has “paid” the tax.
The Litigation Team
The litigation team will be made up of both barristers and an employment lawyer, which means that we will be able to put forward, and counter, all the arguments that we envisage being part of this case.
Why Use Crowd Funding?
*This is simply for complete visibility. If the target needed for the case is not reached, then the money will not be taken from the crowd funding and will be returned to each individual contributor. If this were to be the case, then this is essentially the end of the road for any and all LCAG litigation processes.
*If there are excess funds from previous LCAG/LCJREU litigation actions, then this money will also be used towards the FTT case.
*However, if the FTT case does not progress, then all remaining funds (if any) will be donated to charity.
Any contributions that exceed the £55,000 fixed fee for the first round, will be allocated to the next round of litigation fundraising for this case.
What Do We Need You To Do?
If you pledged an amount in response to the survey, please donate that amount here. You can obviously increase your donation if you wish to.
If you didn’t pledge any money or didn’t respond to the survey, you can still donate here.
This crowd funder has been set up to collect contributions to the litigation which LCAG are taking forward. We asked everyone who is registered with LCAG to give their opinions on the next steps for the litigation journey, and over 90% of people who voted agreed this was the right way forward. This was an overwhelming endorsement that our proposal should proceed.
Summary of the Action
The basis on which we would take the case to the FTT will be on both the European law argument used in Scotland and England, but also additional PAYE arguments which strengthen our case further. Some of these arguments come off the back of the cases of Lancashire and Hoey.
In the FTT for “open years”, the arguments would be:
1. European law applies – effectively, the Loan Charge amounts to an interference with the free movement of capital between European Member States and, in any event, constitutes a disproportionate penalty.
2. By applying the Agency Rules are not liable to tax because they have to allow a tax credit
The argument against the Loan Charge would be:
1. European law applies – as above.
2. Reliance would be placed on ITEPA 2003 s.554Z6 . The argument that the payment by the agent is following Rangers a payment of earnings by the agent. These are relevant earnings which reduce the Loan Charge to nil.
3. Alternatively, reliance is placed on s.554Z5. If the agency is the employer, the umbrella company is not the employer. If that is wrong and you can have two employers, then s.554Z6 applies also to the umbrella company. The loans were payments of earnings. If you can only have one employer, the payment of a loan by the umbrella company means PAYE should have been deducted by the umbrella company. The contractor is entitled to a tax credit and so has “paid” the tax.
The Litigation Team
The litigation team will be made up of both barristers and an employment lawyer, which means that we will be able to put forward, and counter, all the arguments that we envisage being part of this case.
Why Use Crowd Funding?
*This is simply for complete visibility. If the target needed for the case is not reached, then the money will not be taken from the crowd funding and will be returned to each individual contributor. If this were to be the case, then this is essentially the end of the road for any and all LCAG litigation processes.
*If there are excess funds from previous LCAG/LCJREU litigation actions, then this money will also be used towards the FTT case.
*However, if the FTT case does not progress, then all remaining funds (if any) will be donated to charity.
Any contributions that exceed the £55,000 fixed fee for the first round, will be allocated to the next round of litigation fundraising for this case.
What Do We Need You To Do?
If you pledged an amount in response to the survey, please donate that amount here. You can obviously increase your donation if you wish to.
If you didn’t pledge any money or didn’t respond to the survey, you can still donate here.
Organizer
Loan Charge Action Group LCAG
Organizer