K2 scheme sparks tax avoidance debate
A Jersey-based tax avoidance scheme reportedly used by comedian Jimmy Carr has sparked further debate about the difference between unethical tax avoidance and legitimate tax planning. Nick Huber reports.
More than 1,000 people, including Carr, are reported to be using the legal Jersey-based K2 scheme, which is said to be sheltering £168m a year from the Treasury.
Under the scheme, revealed by The Times newspaper, an individual resigns from their company and any salary they subsequently receive is paid to an offshore trust.
Carr said on Thursday that he was no longer involved in the scheme and apologised for a “terrible error of judgement”.
In a statement released via his Twitter page Carr said: "Although I’ve been advised the K2 Tax scheme is entirely legal, and has been fully disclosed to HMRC (Her Majesty’s Revenue and Customs), I’m no longer involved in it and will in future conduct my financial affairs much more responsibly."