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Press Release

FSB slams shameful conduct of HMRC in family tax case

Tuesday June 5 2007

The Federation of Small Businesses (FSB) has attacked the conduct of HM Revenue & Customs (HMRC) in a family tax case that is being heard in the House of Lords from today.

The UK’s biggest business organisation criticised HMRC’s decision to ignore a refusal by the Court of Appeal to allow a petition to the House of Lords in the so-called Arctic Systems case.

The case centres on a family-run business, Arctic Systems Ltd, which used dividends from the business to remunerate Geoff and Diana Jones, the shareholders. Despite a decisive ruling by the Court of Appeal in favour of the taxpayer, HMRC is continuing its campaign to extract money from the Jones’.

Bill Knox, FSB Taxation Chairman, said:

“HMRC’s conduct towards a family-run business in this case is utterly shameful. They refused to respect the decision of the Court of Appeal, which delivered a decisive and authoritative ruling in favour of the taxpayer.

“Hounding hardworking small business owners in this way sullies the good name of HMRC and will not instil confidence in the UK small business community as a whole, which rightly expects to be treated proportionately and fairly by the tax authorities.

“The craven decision to pursue the case further will be at the expense of the taxpayer and will result in a damaging loss of confidence in HMRC’s record with small businesses.”



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Federation of Small Businesses

Federation of Small Businesses

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