HMRC names and shames two tax avoidance schemes
As part of a campaign to raise public awareness, HMRC has named two tax avoidance schemes, sending a message that it will not tolerate these cynical schemes and their promoters.
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Why does everyone go along with HMRC's 'interpretation' of Tax Avoidance?
Tax Avoidance (according to HMRC at https://www.gov.uk/guidance/tax-avoidance-an-introduction) = "Tax avoidance involves bending the rules of the tax system to try to gain a tax advantage that Parliament never intended."
Tax Avoidance (according to all other sources) = "the legal usage of the tax regime in a single territory to one's own advantage to reduce the amount of tax that is payable by means that are within the law" (or similar wording depending on selected source).
Note 1: In both cases the phrase is recognised as applying to activities/treatments that comply with the law. Only HMRC attempt to twist this by suggesting it (always?) involves 'bending the rules' (which although IANAL is not a legal concept with which I'm familiar - and appears to be more an attempt to introduce a moral dimension of HMRC's choosing).
Note 2: In their communications with the wider public (via press releases etc), HMRC go even further and portray tax avoidance as synonymous with evasion ... which of course it isn't!
I know nothing of the two schemes mentioned (and hold no candle for others of their ilk), but IF they are deemed by HMRC to be tax evasion then say so - or at least test that accusation.
But if HMRC declares them to be mere tax avoidance schemes, then all they are really saying to the users (existing or potential) of such schemes is "Watch out ... we intend to challenge this as attempted evasion". In which case, fair enough but stop calling them avoidance schemes!
Always amazed that HMRC know exactly what Parliment intended
But in all fairness HMRC probably tried to tell them what HMRC wanted. Would it be better if HMRC bypassed Parliament and started writing the legislation?
Then all we need is a decision by the supreme court to finally know what the law really means.
I always find it surprising that people are willing to part with 20% of their money in fees to these types of schemes with all the dangers involved, rather than pay the (probable) 40% tax due...
You're only saving half the tax charge and the only people really safe are usually the promoters who disappear at the first sign of trouble, despite promising full cover in the event of any challenge, etc.
Buyer beware!
name and shame the advisers and barristers involved rather than a company.....dealing with the branches rather than the root will not resolve the problem....
Is it just me?
Could there not be a simple solution to employee loans?
Something along the lines of s455
But with the exception of secured loans made by businesses in the trade of lending
These schemes cost the avoider basic rate tax as a fee in the vain hope of not paying the other 20% for income exceeding £50K
And in addition not paying NI