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One minute with... John Dunlop

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What’s keeping you busy at work?

In the run up to 6 April, it felt as if I was only doing IR35 work assessing various contractors and advising on IR35 policies for clients, all against the backdrop of case law which is not always helpful to real life IT workers. Whilst this has tailed off somewhat, there still seems to be lots of work here with new contractors being taken on board. With many big banks having publicly said they do not want to engage IR35 contractors, and because the various furlough schemes gave little or no help to IR35 contractors, I have the feeling that the attractions of off-payroll will diminish over the coming months.

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

I do not understand the fundamental objection to tax-efficient options being granted over shares which are in a subsidiary company, especially where the company is controlled by a limited partnership so that the only controlling company is the general partner who has little or no economic rights. Hopefully, the current review into EMI share options can address this.

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

When you are having a difficult interaction with someone (HMRC, client, colleague etc.), I used to wish I could make them change. Now I have come to realise that I can’t change them and it’s highly unlikely I am going to change either. Therefore, the only thing that I can change is how that other person perceives me. I’m not sure whether this has actually made a difference to any negotiation in which I have been, but it has made me feel more in control (although one could argue that was probably just the illusion of control).

What advice would you give to someone starting out in tax today?

Be interested; read around the topic and always finish the chapter – you never know when that extra nugget of knowledge will come in handy.

Also, if you don’t know what to do, think of the smartest or most moral person you know (which of them depends on the nature of the problem) and ask yourself, what would they do?

Has a recent tax case caught your eye?

There is a specific rule in VAT assessments which broadly says once HMRC has been told of an issue in sufficient detail, if it does nothing for a year then it is out of time. Whilst there is no legislative equivalent in direct tax, the tribunals have in recent years started to consider a similar concept of a discovery becoming stale such that HMRC is out of time if it discovers something but then does not act upon this for a considerable period (see Pattullo [2016] UKUT 270 (TCC); Hunter [2019] UKFTT 312 (TC); Beagles [2018] UKUT 380 (TCC)); and Mehrban [2021] UKFTT 53 (TC)). It is a good check and balance on HMRC’s powers, and hopefully the higher courts will soon confirm this.

Who has most impressed you in tax?

I greatly admire Keith Gordon (Temple Tax Chambers) and Richard Woolich (DLA Piper), both of whom are super intelligent and have been incredibly generous with their time. However, I have to say that my colleague Christopher Cox is the smartest man I have ever come across. In addition, he manages to carry it off with kindness and an unbelievable level of modesty (not to mention being a great dancer).

What should we look out for later this year?

Was the possibility of a rise in the rates of CGT a flash in the pan or is this still waiting for us down the line? When talking about rates rises, I recall that about ten years ago HM Treasury was already saying that current capital gains tax rates were at about the Laffer curve peak, such that an increase in rates would actually reduce the tax revenues.

You might not know this about me…

I am never happier than when cycling up an alpine climb. All my troubles fall away as soon as the road rises upwards. 

Issue: 1531
Categories: One minute with