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One minute with... Zena Hanks

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What’s keeping you busy at work?

Working with interesting clients doing interesting things. Right now, there is a lot of focus on succession planning, not just to consider how best to pass the family assets to the next generation, but also bringing the next generation into the conversations and decision-making process. Being part of that is a real privilege.

If you could make one change to a tax law or practice, what would it be?

I would say to the government, stop nibbling. We frequently see changes and tweaks to an already complicated tax system, so my view would be to do a thorough review and change where necessary to reflect modernity, but please stop nibbling. Can we have a roadmap please so that we know what to expect for any future tax changes?

What do you know now that you wish you’d known at the start of your career?

That it’s okay not to know everything and the sooner you can get comfortable with that, the better. Put plenty of focus on asking questions and keep delving.

Has there been a recent change that is causing a particular problem?

Hold-over relief in the event of transferring business assets between separating spouses as part of a divorce settlement has remained a valid solution based on longstanding practice and a view supported by HMRC’s previously stated guidance.

However, HMRC recently updated its manuals on hold-over relief for transfers of business property after the tax year of separation to say that, instead of there being no consideration for a transfer of shares where a court makes an order, there is consideration in satisfaction of a parties’ claim on divorce. In other word’s, HMRC’s current view is that it is no longer possible to claim hold-over relief in a divorce context (see HMRC’s Capital Gains Manual at CG66886).

HMRC’s support for its change of view is derived from the 2007 Court of Appeal case of Haines v Hill [2007] EWCA Civ 1284, so it is odd, and arguably unfair, that HMRC has changed its position some 14 years later. Its view is, of course, not the law, and I am aware that Resolution and others have made representations to HMRC as to the negative impact such a change brings where illiquid assets are changing hands between parties because there is no actual sale and there is no liquidity to pay the tax.

It is very unfortunate that HMRC has changed its view, and the uncertainty this now causes for all concerned given HMRC’s previous guidance is clear to see.

What issues have clients been raising recently?

There’s lots of interest on the tax profile of transactions in involving cryptocurrency.

Finally, you might not know this about me but...

Having played Moth in Shakespeare’s Midsummer Night’s Dream in the school production, I was asked to audition for a BBC drama. Sadly, nothing came of that and instead I turned to a career in tax which I am sure is much more rewarding…

Issue: 1552
Categories: One minute with