What about that Jimmy Carr, then?

 

Simon Sweetman reflects on the recent headline stories involving the comedian, his K2 tax scheme and prime minister David Cameron.

Continued...

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memyself-eye's picture

Eeeh by 'eck we used t'lick coal clean w'tongue..    1 thanks

memyself-eye | | Permalink

.....and pay pit owner for permission tut come t'work...... but that was befrore the good times under Gordon "I've put an end to boom and bust" Brown who promised a minmimum £12k a year for every family working or not. How arrogant that sounds now.

To unscramble that client state will take decades as the governor of the bank of England has recently pointed out. That's assuming it can be sorted.

The good times while they lasted meant that 'avoiders' a la Mr Carr were, like the pensions time bomb, tolerated or at least put on hold. After all,when wages are rising people don't address difficult issues- the proverbial roof doesn't get fixed.

Meanwhile a new cohort of (mostly) public sector fifty somethings are now retiring on handsome pensions- I know several- adding yet more costs to the welfare bill.

And the next election is nearly upon us!

 

his accountant should be shot    1 thanks

Andy3T | | Permalink

The Times report which kicked it all off explained that they'd identified Mr Carr from comments made by the accountant who sold him the scheme during an undercover sting, the accountant told the reporters that they'd sold the scheme to someone in the entertaining industry and the rough amounts involved, the reporters then looked through the LLP and company filings for LLPs and Companies set up by the accountant and asked the accountant if they'd been referring to Mr Carr in a second meeting.

That gripe aside, the wider point of the reputational cost of being involved in "a scheme" is clearly not something that can be ignored by potential buyers.  Whether we like it or not, tax is clearly a political issue now and the level of understanding between evasion, avoidance, or simply the mechanics of how the tax system works is clearly minimal for most people.

Ermintrude's picture

Substance Over Form

Ermintrude | | Permalink

I'm surprised that the K2 company and the tax avoidance strategy of it and its "employees" has a leg to stand on.  As the loan back to employees, rather than salary/divi route, is widely acknowledged as an artificial arrangement

I recalled the legal issue of Substance Over Form from a business law module somewhere in my studies.

Looking this up on (good ole) Wikipedia, this popped up for America (I presume):-

Substance over form

The doctrine of substance over form is essentially that, for Federal tax purposes, a taxpayer is bound by the economic substance of a transaction where the economic substance varies from its legal form.

Can't find anything re UK, and haven't time to research it, but would be interested in anyone else's opinion?

I'm clearly wrong in my over-simplification, but I don't know why as I'm no lawyer, and I would like the details of how I am wrong spelled out to me.

fiddling t"    1 thanks

jeans&t | | Permalink

"Tax avoidance is suddenly being seen as akin to MPs fiddling their expenses"

Isn't the "flipping" of main residence/2nd home(s) tax avoidance?

Isn't the claiming of fictitious expenses a form of tax evasion (amongst other things)?

Didn't MPs involved claim that they were doing nothing wrong, that what they were doing was

within the rules?

Is Mr Cameron saying that the House Of Lords & House of Commons are "morally repugnant"?

 

 

“Bread and butter” tax planning…

Chaztax | | Permalink

…can – of course – save clients large amounts of tax.

If all advisers are doing is telling people about reliefs and allowances (e.g. entrepreneurs’ relief, CGT annual exemption, etc, etc) which are specifically intended to save certain people tax under certain circumstances, it’s very difficult to see how that can REASONABLY be seen as unethical.

Tax advisers who make their living from this kind of straightforward planning should robustly defend what they do as not merely legal, but also ethical.

@jeans&t

pauljohnston | | Permalink

If it were you or me fiddling our expenses we would be kicked out of the business.  Strange though most MPs were not and the recent Baroness who seems to have overeclaimed was not even censured.

I suspect the Times made such a fuss is it tried to gets its bosses off the front page (Leverson Enquiry).

@paul    1 thanks

justsotax | | Permalink

trouble is the MP's wrote their own rules - so most were not actually fiddling but just claiming what they were entitled to (albeit some pushed the boundaries...and a few ended up being convicted) - still two wrongs don't make a right......unless of course there is a suggestion that 'fiddling' is open to all and should be seen as 'legal'....

Ermintrude's picture

@justsotax

Ermintrude | | Permalink

Re MP's writing their own rules - yes indeed - the main one of their benefit being the residence flipping.  I wonder how much tax over the years that has actually involved?