The many challenges and exciting opportunities facing online and tech businesses, from the fast growth sector up to established multinational businesses. I find it fascinating to learn about new and entrepreneurial ventures in the tech world, and then work out how tax fits in, of course!
If you could make one change to tax law or practice, what would it be?
It would benefit all parties – the tax authorities, businesses and advisers – if there was a better working relationship between tax authorities and large businesses. In my experience, the vast majority of entrepreneurs and businesses are looking to get tax right, whilst grappling with an increasingly complex and global tax system. At the end of the day, their reputation is at stake. However, there are still some tax authorities in the world, and some individual tax officers, who default to the position that taxpayers should be treated with suspicion. They can make life unnecessarily difficult and expensive, and that can break down the relationship of trust between taxpayer and the government, which is not helpful when compliance is actually a high priority for many.
Are there any new rules causing a real problem?
For my clients, the taxation of digital services is proving quite a challenge, as many countries around the world are introducing new rules in quick succession, with a different scope or interpretation of the rules. For example, digital businesses which are selling e-services to private individuals are often caught by new local VAT or GST rules, but questions arise as to whether some business to business or some business to government supplies are included; what is the definition of an e-service; who is deemed to be making the supply; and how does the business manage compliance operationally? Often, the tax authorities themselves are not well prepared for the implementation of the new tax, which makes it even more difficult to comply. The other issues impacting businesses are, of course, MTD, Brexit, and the digital services tax, but that probably goes without saying.
What do you know now that you wish you’d known at the start of your career?
That tax is not just about learning the legislation. When I first started, I thought that tax was a very dry subject, and I spent hours in the bar with my fellow trainees dreaming up job titles to make our job sound more exotic when people ask us what we do. My job now involves far more than understanding tax legislation: it’s about understanding new products, business models, commercial issues, operational impact, people impact and, importantly, navigating both internal and external relationships. I still think that the title ‘tax adviser’ under-sells us, however, and I prefer to be known as an ‘international fiscal negotiator’…
Has a recent tax case caught your eye?
There are a number of cases going through the courts at the moment, where the judge has taken a moral position against the taxpayer, when UK law may be unclear. An example of this is the FTT decision in Hutchison 3G [2018] UKFTT 289, where the judge states openly in her judgment that the law is open to interpretation, but as a matter of principle, HMRC’s position is preferred in order to protect the revenue. Although this is not a new development in itself, with Brexit around the corner, it will be interesting to see where HMRC looks to make changes to UK tax law which is currently ambiguous and potentially advantageous to taxpayers once free from the influence of the VAT Directive and CJEU judgments, and with moral support from the UK courts.
You might not know this about me…
I have a horse, which I rather impulsively bought whilst on holiday in Spain and brought back to the UK to train (it beats a straw donkey, I suppose). She takes up any spare time I have when I’m not looking after my son and our labradoodle puppy (a recent addition to the family).
The many challenges and exciting opportunities facing online and tech businesses, from the fast growth sector up to established multinational businesses. I find it fascinating to learn about new and entrepreneurial ventures in the tech world, and then work out how tax fits in, of course!
If you could make one change to tax law or practice, what would it be?
It would benefit all parties – the tax authorities, businesses and advisers – if there was a better working relationship between tax authorities and large businesses. In my experience, the vast majority of entrepreneurs and businesses are looking to get tax right, whilst grappling with an increasingly complex and global tax system. At the end of the day, their reputation is at stake. However, there are still some tax authorities in the world, and some individual tax officers, who default to the position that taxpayers should be treated with suspicion. They can make life unnecessarily difficult and expensive, and that can break down the relationship of trust between taxpayer and the government, which is not helpful when compliance is actually a high priority for many.
Are there any new rules causing a real problem?
For my clients, the taxation of digital services is proving quite a challenge, as many countries around the world are introducing new rules in quick succession, with a different scope or interpretation of the rules. For example, digital businesses which are selling e-services to private individuals are often caught by new local VAT or GST rules, but questions arise as to whether some business to business or some business to government supplies are included; what is the definition of an e-service; who is deemed to be making the supply; and how does the business manage compliance operationally? Often, the tax authorities themselves are not well prepared for the implementation of the new tax, which makes it even more difficult to comply. The other issues impacting businesses are, of course, MTD, Brexit, and the digital services tax, but that probably goes without saying.
What do you know now that you wish you’d known at the start of your career?
That tax is not just about learning the legislation. When I first started, I thought that tax was a very dry subject, and I spent hours in the bar with my fellow trainees dreaming up job titles to make our job sound more exotic when people ask us what we do. My job now involves far more than understanding tax legislation: it’s about understanding new products, business models, commercial issues, operational impact, people impact and, importantly, navigating both internal and external relationships. I still think that the title ‘tax adviser’ under-sells us, however, and I prefer to be known as an ‘international fiscal negotiator’…
Has a recent tax case caught your eye?
There are a number of cases going through the courts at the moment, where the judge has taken a moral position against the taxpayer, when UK law may be unclear. An example of this is the FTT decision in Hutchison 3G [2018] UKFTT 289, where the judge states openly in her judgment that the law is open to interpretation, but as a matter of principle, HMRC’s position is preferred in order to protect the revenue. Although this is not a new development in itself, with Brexit around the corner, it will be interesting to see where HMRC looks to make changes to UK tax law which is currently ambiguous and potentially advantageous to taxpayers once free from the influence of the VAT Directive and CJEU judgments, and with moral support from the UK courts.
You might not know this about me…
I have a horse, which I rather impulsively bought whilst on holiday in Spain and brought back to the UK to train (it beats a straw donkey, I suppose). She takes up any spare time I have when I’m not looking after my son and our labradoodle puppy (a recent addition to the family).
