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TaxationWeb by Daniel Feingold

This article discusses the role that a Tax Lawyer has to play in Tax Advisory work. I also set out the areas I'll be covering in forthcoming articles.I thought it might be helpful as an introduction to this section to explain something of the role of Tax Lawyer, especially as so many people tend to associate tax exclusively with Accountants.

Tax advice particularly when it involves complex planning or perhaps defending a taxpayer against an Inland Revenue investigation usually involves negotiating and interpreting and advising on issues of Tax Law.

Therefore, a Tax Lawyer has a natural role in both interpreting the Law, be it based on statute, case law or for
International Tax issues: -Double Taxation Treaties.

In fact,Tax Lawyers often work together with Accountants and other Lawyers to advise clients on the best ways to solve their problems, or carry out tax planning.

Looking more closely at the role of the Tax Lawyer it can be divided into three interlinked roles.

1: Firstly, the Tax Lawyer interprets and advises on issues of tax law. Will a legal case based on similar facts be accepted as the law? Does a particular section of a Finance Act create a loophole that can be exploited?
Who will win if the matter goes to court?
What can determine a person's Legal Domicile?
Furnishing a written(or second) opinion as to the tax law position in a complex matter, to assist an Accountant or Lawyer?

2: Secondly, to carry out most complex tax planning, it is necessary to draft the relevant legal documents; such as Trusts,Wills Contracts and Share Schemes.
Who better to draft such key documents than a tax Lawyer who understands the objective behind such planning a can draft the document with that in mind?

3: Thirdly, when conducting negotiations with the Inland Revenue on a contested case. The Tax Lawyer will have developed negotiating skills combined with an awareness of the taxpayers legal rights. The Inland Revenue can threaten the taxpayer with both civil and criminal prosecution and so a Tax Lawyer with an understanding of both civil and criminal law; and the fast developing Human Rights Act 1998, can be a vital asset in defending the taxpayer and ensuring fairness.

I hope that gives you a little insight into the role of a Tax Lawyer.

Now let me tell you a little about the areas of UK and International Tax Law I intend to cover in this section.

Many UK Taxpayers are currently thinking about the impact of Inheritance Tax on their wealth. As a result of the recent surge in the value of residential property, even a modest home may result in a significant tax liability.
I shall review several popular tax planning solutions. One that has been highlighted as a result of a recent court case (the EVERSDEN case) and others that have been developed by leading Tax Lawyers. Only one is an outright winner and I'll be discussing how you can act upon it and how soon you need to do so to benefit!

Next, I intend to look at an area that is shrouded in mystique and misunderstanding, but can also offer taxpayers incredible tax savings!
The advantages of being classed as NON-DOMICILED can produce huge savings in Income, Capital Gains and Inheritance Taxes. The proposed review announced in the recent budget creates some uncertainty and a huge opportunity; as any changes will not be implemented for few
Years. So, there's still plenty of time to take advantage of being classed as NON-DOMICILED.
I?ll show you how to do so and how such planning can still be effective, even after any proposed changes.

Then, there is the well-worn path that so many advisers trot out of becoming NON-UK RESIDENT to avoid Income, Capital Gains and Inheritance Tax. Can it really work? Or might you end up miserable in Monaco.
All too often taxpayers choose the wrong location and end up "Out of the frying pan and into the fire!" I'll be looking at various countries, many suitable for avoiding a particular type of taxes and highlighting some of the best locations for avoiding all taxes!

When we start talking of leaving the UK and taking up residence elsewhere, the words "Offshore Tax Haven" come to mind. Many of you may in the past have had some involvement in Offshore Tax Planning and particularly the use of Offshore Trusts. Following repeated attacks in successive Finance Acts, Offshore Tax Planning may now be considered dead. I'll be looking at whether there are any tax savings still to be had by utilising Offshore Tax Havens and for those with existing Offshore Trusts, how they can be wound-up with the minimum of tax liabilities.

There's one tax planning measure that was so attractive to Companies, their Directors and key Employees, that the Inland Revenue altered the law last November: -Four Months before the budget to save tax being lost! I'm talking about Employee Benefit Trusts or "EBT's" as they're often called.
I'll be looking at these vehicles that used to offer both the Company and the Employees total tax efficiency. I'll also be considering the vital question of whether they still have a role to play in tax planning (with or without, the Corporate tax deduction for payments made into them).

Rewarding key Employees has always been an important part of the strategy of the most successful Companies. Radical Changes in the taxation of Employee Share and Share Option Schemes have been made recently via lengthy and laborious pages of the Finance Bill. I'll be considering what are the most tax-efficient ways to reward key Employees? And highlighting some planning opportunities that are still available, even after the recent changes.

What happens when it all goes wrong? I'm thinking of situations when someone has been tempted into "tax evasion" or simply used a tax avoidance scheme that's failed; or simply fallen foul of some recently introduced tax legislation.
I'll be examining the impact of the Human Rights Act 1998 in dealing with Inland Revenue tax investigations.
How to deal with specialist departments in the Inland Revenue: - Special Compliance Office, International Division and the Capital Taxes Office.
What to say? how to say it! and most importantly what not to say!

So, keep an eye on this section of taxationweb as I'll be posting the above articles (and hopefully many others) over the next few weeks and months.
I'll also be posting lots of other tips and topical news, as and when it develops.

Daniel Feingold Barrister-at-Law