Is Dan Neidle Ideologically Opposed To Our Existence?

For your amusement I let ChatGPT, redo your article have you got some competition 🙂 ?

"Is Dan Neidle Standing in the Way of Your Success?"

The recent buzz surrounding the trial of Property118 on social media has been impossible to ignore. Central to this narrative is Dan Neidle, whose critiques are now so influential that even major national newspapers are intertwining his arguments with HMRC's Spotlight 63. Yet, let's not forget: Property118 had the foresight to caution against the potential misuse of Hybrid LLP structures as early as 2018.

Imagine a Venn diagram. One circle encapsulates the heart and soul of Property118 – you, the UK housing rental business aficionados. From our research, it's evident that Dan Neidle seems to have a deep-rooted ideological clash with this very group.

The other circle? It’s tax planning – a domain which, to some of Neidle's backers, might be mistakenly equated with "tax evasion."

And right at the intersection of these two circles stands the mission of Property118 and Cotswold Barristers: ensuring business continuity, preserving legacies, and guiding retirement planning for UK landlords. Our commitment doesn’t end there; we're here to help fine-tune ownership structures for maximum efficiency.

Our track record speaks for itself. Time and again, we've not just stood by the legality but also the ethical integrity of our advice. If you find yourself resonating with the core ethos of Property118, wouldn’t you say there's a moral obligation to understand your options better? After all, these are the very options that Neidle and his brigade would rather you not explore. The real question is: isn't it time to prioritize the welfare of your family and personal interests?

Aside from the Americanism, I like this version a LOT.

I'm very happy for our readers to decide which version they prefer and if they prefer the Chat GPT version I'm happy to consider using it a bit more in the future 😉

Also look up "Gish Galloping" ...

The Gish gallop is a rhetorical technique in which a person in a debate attempts to overwhelm their opponent by providing an excessive number of arguments with no regard for the accuracy or strength of those arguments. Gish galloping prioritizes the quantity of the galloper's arguments at the expense of their quality. The term was coined in 1994 by anthropologist Eugenie Scott, who named it after American creationist Duane Gish and argued that Gish used the technique frequently when challenging the scientific fact of evolution.

Strategy

During a Gish gallop, a debater confronts an opponent with a rapid series of many specious arguments, half-truths, misrepresentations, and outright lies in a short space of time, which makes it impossible for the opponent to refute all of them within the format of a formal debate.

Each point raised by the Gish galloper takes considerably more time to refute or fact-check than it did to state in the first place, which is known online as Brandolini's law.

The technique wastes an opponent's time and may cast doubt on the opponent's debating ability for an audience unfamiliar with the technique, especially if no independent fact-checking is involved or if the audience has limited knowledge of the topics.

https://en.wikipedia.org/wiki/Gish_gallop

The whole issue simplified:

Property investors can legally purchase property in personal name. Alternatively, they can legally purchase property via ownership of a limited company. They can legally transition between the two and there are transitional tax reliefs available and designed for the very purpose if they meet certain criteria.

In some, but not all circumstances, transitioning to a limited company reduces the overall tax bill. Limitation of liability, succession planning, professionalisation of the business and access to finance are four main reasons to transition to a limited company that have no bearing on tax.

Nobody is disputing the above.

So what is so morally repugnant about such a transition that serves to level the tax playing field amongst property investors?

P118 has been attacked for one reason alone. Because they facilitate the above for many landlords and advertise to landlords that such transitioning is possible and affordable.

There are those that are anti landlord and anti wealth that will look to gain recognition in society by leveraging such sentiments. Such folk often point to altruistic motivation to mask their true motivation which, without exception, is driven by objectives that are either financial, career or egotistic. Nearly all those that join in with written support can be linked to some form of gain from the reduction of the success of P118.

Dear Mark,

You are very civilised to endure what could be an unjustified existential threat to your business. Your critics revel within your accommodation.

The key is that you work WITH the authorities to achieve the best results. You do not seem to work outside the relevant legislation but use their interpretation of the rules and are guided by them at every necessary stage.

I’m not sure I understand this. My recollection from school days is that the intersection of the 2 circles represents property investors who also carry out tax planning. It doesn’t mean that all of this group use the services of Property 118, though obviously some do. Isn’t this, therefore, a misrepresentation?

Reply to the comment left by at 26/10/2023 - 12:00
It depends how you look at this.

An alternative perspective is that 100% of Property118 clients are indeed at the intersection of the two circles.

Also, given that landlord tax planning is very much our niche and that the structures and processes we follow have received more scrutiny than any other advisers since 2016 that's one of the many reasons we have become the market leaders in this sector.

Mark
You know I admire you.
There are some genuine difficulties with your bespoke advice (not a scheme). NOTES APPENDED BY MARK ALEXANDER
1. You are aware that prior to Ramsey, a simple BTL ownership of property could not be a business in the Revenue's opinion. It was more akin to holding of stocks and shares - an investment. This is incorrect. HMRC has only ever challenged one case, that was the Elizabeth Moyne Ramsay case. There were several occasions where property rental business owners were granted incorporation relief prior to that case. Insofar as I am aware there has not been any further incorporation relief cases taken to Tribunal since the 2013 Ramsay case
2. It is an unintended consequence that Ramsey established that ownership of investment property could be a business in certain circumstances. It is this unintended consequence that allows you to market your bespoke advice. I cannot reconcile your statements. What are you suggesting the intended consequence of the Ramsay case was?
3. It also shows that the Revenue view is NOT law. Agreed. It is merely HMRC's opinion. Agreed. It is the courts that will decide the law. Agreed. This applies to HMRC Manuals as well. Agreed. You cannot rely on them 100%. Agreed that's why it is so important to also consider legislation and case law. However, HMRC inspectors are trained to work from HMRC manuals, so that's always a good starting point.
4. Ramsey is said to have established that a series of transactions entered into for tax purposes are to be ignored. The end is the same as the starting point. That's a different Ramsay case, a different person, but I am familiar with that case too. 
5. Your bespoke advice is that you would argue that each step has other reasons (legacy planning, limited liability etc) and not just tax. Correct. This can be doubted. Agreed, but so what?
[Some of the steps are: create an LLP and then transfer your properties into them; this is always a stand-alone transaction. it is not part of a series of steps and never could be. This is because nobody can be certain what legislation will look like three years ahead of time. Furthermore, a whole variety of other circumstances would have changed. Therefore, if an LLP is recommended it must be viable as a stand alone transition for both tax and non-tax related business purposes.

wait 2 years; we always recommend a review after three full years

then incorporate a smart company; not necessarily, a SmartCo might not be necessary to meet every clients objectives

transfer LLP properties into the smart company; not necessarily, this will be considered at the three year review point but it may or may not be a viable option for the reasons explained above

pay 2% fee and £750 to create a Director's Loan Account; not necessarily. There are several alternatives to arranging bridging finance to provide the business with the necessary cash to afford the owners to withdraw their capital account balances. If they don't have a positive capital account balance this commercial step isn't applicable.

a discretionary trust can be created by a letter and not Deed; I don't really understand this point because it makes no legal sense and bears no resemblance to what we recommend.

Ten Year Anniversary Charge can be avoided; if a property has a mortgage, then there are other steps. If you are successful, then you avoid/mitigate IT, CGT, SDLT, IHT, CT.] No tax is avoided. When transitioning between various ownership structures the applicable reliefs either apply or they don't, it is as simple as that. The ownership structure moving forward determines the future tax treatment.
6. How should your client answer two questions when he completes on-line his Income tax return:
Q1: "Did you have a tax advisor?" Yes
Q2: "Have you used one or more tax avoidance schemes?" No
Can you honestly say: No, when you have paid a large sum for the bespoke advice? Yes
7. Your bespoke advice has never been considered by a court of law - is that correct? Correct. That would only ever occur if HMRC was to diagree with the planning we recommended, and they never have. 
8. You have asserted that many of your clients have been investigated and cleared. Correct.
How did they or their agents reply each year to the above 2 questions on the Tax Returns? As above.
Did any of them have non-European names - specifically, African or Asian? Yes