What to do after ILR is refused due to tax discrepancy

[Devil81]

Hi chaps,

These days, I am reading lots of post from guys having their ILR applications turned down due to tax discrepancies mainly the self-employed ones.

There are cases where people inflated their earnings during past applications and paid less tax. Also, there are ones who thought their accountant paid the right tax and never bothered to check with HMRC and few cases where dodgy accountants have completely cocked up their client’s accounts to save tax and they only realized when they went for ILR.

It has come to a point where we have started to distrust and disbelieve the accountants even if they are reputed and ICAEW registered.

What does someone do after his ILR application has been rejected? Does he/she make a fresh application for ILR after paying off the taxes or should go for AR or JR?

Not sure if AR or JR really apply here.

I have seen numerous responses but can’t seem to find a concrete answer to this. What’s the way forward or how to mitigate or tackle tax issues? Kindly air your opinions on this issue.

Thanks

[geriatrix]

AR will not lead anywhere - being refused due to tax evasion is not an "administrative error".
Whether legal recourse / PAP (JR) will succeed or not depends on the merits of the case. IMHO, it will be very hard to convince a judge that having resolved (or having attempted to) any tax discrepancy only after making a settlement application (or after being refused once) the applicant had no intention to deceive!


That is why the general suggestion from the wise members of the forum is that - sort out your tax affairs before making a settlement application.



All the (tax related) refusals that I have read on the forum are in cases where tax issues have not been sorted before making an application (be it actual fraud, accountant's mistake, ignorance, or name it however you want). None of the cases where tax issues were sorted beforehand have been refused, AFAIK.

Applications where (tax) issue resolution was initiated (and / or completed) beforehand but are still refused because HO is unable to verify the updated status from HMRC during the timeframe allowed to HO are the ones that stand the chance of a favorable decision in AR (if additional and new evidence is permitted in AR) or legal recourse. Because in such cases one can argue that there was no intention to deceive and it was the slow pace of updation that resulted in the failure to convince HO otherwise during the application process.

What is hard to catch is when an employer provides fraudulent salary slips / P45 / P60s to the employee and submits some other figures under PAYE. Unless someone requests his employment history from HMRC, it is not possible for anyone to become aware of such fraud. These are the applicants who can claim that they are genuinely innocent of the accusation (of tax evasion) .... but unfortunately such applicants are also not being spared by HO. IMHO, such applicants may also have a chance to get the decision (refusal) overturned through legal recourse, if not through AR.



Note: If the discussion flow turns to HMRC and its procedures, this topic will be deleted!

[Wanderer]

Fundamentally, the business owner is legally bound to sign the accounts off as true and correct, most people have a feel for what's right and what's wrong, there's no excuses, as a director you have duties, and one of them is to ensure your accounts are true and correct, ticking and signing is not enough.

It's not rocket science.

[ohara]

That is why the general suggestion from the wise members of the forum is that - sort out your tax affairs before making a settlement application

Or just don't fiddle your tax in the first place

[geriatrix]

Having been refused settlement, the options are pretty limited if one is accused of deception and specially so if your leave has expired and you are in UK on borrowed time (section 3c).
Only ILR LR applicants may get a right to appeal. Those applying under PBS route only have the right to request AR.
A request for JR doesn't grant you permission to remain in UK, extend section 3c, or make illegal stay legal.

[Devil81]

Thanks geriatrix for your reply.

I have found some links from gov.uk website to get the employment history. See links below.

https://www.gov.uk/get-proof-employment-history

https://www.gov.uk/government/publicati ... ry-request

Data Protection Subject Access Request Form
https://online.hmrc.gov.uk/shortforms/form/DPU_SAR

Has anyone used them to get their employment history from HMRC?

Thanks

[sifanaeem]

AR will not lead anywhere - being refused due to tax evasion is not an "administrative error".
Whether legal recourse / PAP (JR) will succeed or not depends on the merits of the case. IMHO, it will be very hard to convince a judge that having resolved (or having attempted to) any tax discrepancy only after making a settlement application (or after being refused once) the applicant had no intention to deceive!


That is why the general suggestion from the wise members of the forum is that - sort out your tax affairs before making a settlement application.



All the (tax related) refusals that I have read on the forum are in cases where tax issues have not been sorted before making an application (be it actual fraud, accountant's mistake, ignorance, or name it however you want). None of the cases where tax issues were sorted beforehand have been refused, AFAIK.

Applications where (tax) issue resolution was initiated (and / or completed) beforehand but are still refused because HO is unable to verify the updated status from HMRC during the timeframe allowed to HO are the ones that stand the chance of a favorable decision in AR (if additional and new evidence is permitted in AR) or legal recourse. Because in such cases one can argue that there was no intention to deceive and it was the slow pace of updation that resulted in the failure to convince HO otherwise during the application process.

What is hard to catch is when an employer provides fraudulent salary slips / P45 / P60s to the employee and submits some other figures under PAYE. Unless someone requests his employment history from HMRC, it is not possible for anyone to become aware of such fraud. These are the applicants who can claim that they are genuinely innocent of the accusation (of tax evasion) .... but unfortunately such applicants are also not being spared by HO. IMHO, such applicants may also have a chance to get the decision (refusal) overturned through legal recourse, if not through AR.



Note: If the discussion flow turns to HMRC and its procedures, this topic will be deleted!

Hi geriatrix,

Thanks for your insight on the matter. Very helpful.

I'm on the same boat. I sent all evidence to HMRC on 25th Feb 2016 to amend my returns for 2011 and 2012 as I had joined the 2 back when I submitted the returns. The received it on 3rd March and has been at Technical officers desk since 31st March. HMRC have already extended the deadline they have to get back to me twice, by a week each time.
My last 2 visas have been Tier 2 G, and if HO check my tax returns for when I was in Tier 1G then I'll certainly be refused (according to feedback from others)

My dilemma is should I wait for HMRC to get back to me or should I go for the PEO and hope they dont dig, but if they refuse I could go to JR saying I already asked HMRC to amend before going for ILR.

Company has announced redundancies and I'm worried to delay it further.

Cheers