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Nationwide protests against tax avoiders - 4 Dec 2010 Watch

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    lol are people actually sticking up for tax avoidance/evasion here lol seriously there is no defence for it why should others pay for you to live a luxury life style
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    Twitter is reporting EIGHT shops on Oxford Street alone have closed due to the protests.
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    (Original post by Jacktri)
    lol are people actually sticking up for tax avoidance/evasion here lol seriously there is no defence for it why should others pay for you to live a luxury life style
    What do you mean by avoidance?

    If you buy things in December rather than in January because of the VAT rise you are committing tax avoidance.
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    Just because it's legal doesn't mean it's right, and this is a good way to try to make something that is wrong into something illegal. Cameron and Clegg have spoken about it, but have yet to do anything worthwhile, perhaps with the excuse that not many people seem to be bothered about it - this will give them motivation to act.
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    (Original post by Quady)
    What do you mean by avoidance?

    If you buy things in December rather than in January because of the VAT rise you are committing tax avoidance.
    paying 0 income tax on 500 million earned in a year is more of what i mean
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    (Original post by Jacktri)
    paying 0 income tax on 500 million earned in a year is more of what i mean
    Who are these people paying for this millionaire to live a 'luxury lifestyle'?
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    (Original post by Welsh_insomniac)
    What country are you living in to say that £75 a year is rich?
    It's clear what I meant, being a pedant doesn't make you look clever
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    Has any proof actually been published that Arcadia and Vodafone evaded tax? I've only heard rumour in a room full of smoke and mirrors
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    (Original post by TheMeister)
    Has any proof actually been published that Arcadia and Vodafone evaded tax? I've only heard rumour in a room full of smoke and mirrors
    evaded tax? Have they anything illegal?
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    (Original post by The_Male_Melons)
    evaded tax? Have they anything illegal?
    come again?
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    As I've mentioned, the reason why people are using the term "avoidance" is to prevent libel actions. To accuse someone of tax evasion in/on a public forum is a serious matter & potentially actionable - i.e. You can get sued for it - as can potentially the publication/online forum that repeats those allegations - unless they can be substantiated. Remember that the burden of proof is on yhe accuser to prove guilt, not the defendant to prove innocence.

    In the context of this thread, I am working on the assumption that tax breaks that are advertised by the state - such as on ISAs - are outside the scope. I'm talking about the stuff for which people hire expensive tax advisers.
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    (Original post by The_Male_Melons)
    evaded tax? Have they anything illegal?
    The point is they have not necessarily done anything illegal, but rich people like Philip Green not paying a penny in income tax on a dividend of £1.2 billion is throwing insult in the face of the country. Added to that he has been advising the government on how to save money, what a cheek.

    So no, you don't have to do anything illegal to have a protest against you, but many legal actions can be protested against like the cuts imposed by this "we are all in this" government.
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    (Original post by Tashalls)
    It's clear what I meant, being a pedant doesn't make you look clever
    I'm sorry, poor attempt at humour :p: I didn't mean any offense.
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    (Original post by Jacktri)
    paying 0 income tax on 500 million earned in a year is more of what i mean
    Who does that? And I hope you're not playing pedentary by saying income tax when they pay tax on dividends.
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    (Original post by Maker)
    The point is they have not necessarily done anything illegal, but rich people like Philip Green not paying a penny in income tax on a dividend of £1.2 billion is throwing insult in the face of the country. Added to that he has been advising the government on how to save money, what a cheek.

    So no, you don't have to do anything illegal to have a protest against you, but many legal actions can be protested against like the cuts imposed by this "we are all in this" government.
    So you want the tax on dividends to be higher then, right?

    That would be the fair answer.

    Why not protest for that rather than a in ill defined grouping of policy changes?
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    (Original post by Quady)
    Who does that? And I hope you're not playing pedentary by saying income tax when they pay tax on dividends.
    rich business owners who move their wife abroad to countries with low tax rates and then transfer the business to her so he lives in the uk earning millions tax free
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    I wonder how much Sir Philip Green owes? :colonhash:

    People complain about people on benefits but these British business men/women dodging tax is more pressing issue. If they actually paid their tax we perhaps wouldn't be cutting education or military funding (to name a couple) as much?
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    (Original post by Prince Rhyus)
    As I've mentioned, the reason why people are using the term "avoidance" is to prevent libel actions. To accuse someone of tax evasion in/on a public forum is a serious matter & potentially actionable - i.e. You can get sued for it - as can potentially the publication/online forum that repeats those allegations - unless they can be substantiated. Remember that the burden of proof is on yhe accuser to prove guilt, not the defendant to prove innocence.

    In the context of this thread, I am working on the assumption that tax breaks that are advertised by the state - such as on ISAs - are outside the scope. I'm talking about the stuff for which people hire expensive tax advisers.
    You are into very difficult ground when you interplay the use of the terms and self interpret the line between avoidance and evasion.

    Avoidance ought to be arranging ones affairs, within the strictures of existing legislation and case law to interpret legislation, to reduce one's tax bill.

    Any higher rate tax payer making a pension contribution reduces their tax bill, legislation allows for this and governments try to encourage it. (e.g.Mandatory pension schemes for all are in process of being rolled out)

    Legislation allows for investments in Enterprise Zones which generate a tax loss to offset against other income. (Zones and rules incorporated into the Taxes Acts)

    Whether one is a large firm of accountants, or a sole practioner ,there is absolutely nothing wrong with giving advice regarding avoidance, in fact the accountant might be negligent if he did not.

    The difficulty is defining the line between the two extremes of very vanilla avoidance and when one has stepped into the realm of evasion rather than avoidance. You will be hard pushed to get accountants, who have been studying tax law all their lives ,to agree when this line has been crossed, so defining what is and what is not evasion is difficult.Schemes I have had marketed over the last five years to the business I work for have struck me as too artifical (SHEPS, Gilt Stripping, Charity gifting with AIM shares) however at the time all had counsel's opinion that they were supported by the existing legislation and were marketed by Chartered Accountants, far ahead of me in technical knowledge, who were happy to endorse same.

    The current regime of notification of marketable schemes certainly assists HMRC detecting what is being marketed, and in theory allows them to challenge or rush through legislation to deal with what they perceive as abuse, however it will always, by necessity, run behind the curve.

    The reason such schemes flourish is because the legislation now lacks any cohesion, it is tax through the gaps.

    There are only two real cures to my mind.

    1. General anti avoidance legislation (I believe USA has)
    2. Wholesale rewrite of the tax system, not merely rewrite of the extant legislation, but new thought process as to how tax is levied.

    One cannot merely accept HMRC view on the line, the recent case of Jones v Garret (Arctic Systems) where they tried to rely on the settlements provisions clearly shows that they are not infallible. (Their Lordships upheld the taxpayer's position)

    Intent of parliament cannot be relied upon, for one thing who knows what it was, all taxpayers can rely on is the legislation itself.

    It is taken as a given that taxpayers should be able to have certainty re their position. With self assessment and the new penalty regime the onus on the taxpayer to get everything right is even more important.

    I will give one very simple example and readers can decide if they can all draw the line between avoidance and evasion:

    An individual buys his only house, lives in it for six months whilst doing it up, then sells it for £50,000 more than he has spent.

    As a one of action this looks like selling one's principal private dwelling, outside the scope of tax.

    Suppose he does it re his next house, and his next, and his next and so on.

    At what point, if he has started trading in houses, did this trade start?

    The legislation and case law and HMRC will consider his motive, why he bought and sold each. The frequency of transactions will come into consideration, his means of funding, whether registered on electoral role at each, his normal occupation (Is he a builder/ plumber etc) myriad other subjective tests.

    There is no correct answer anyone can give, there is only a correct answer when interpreted by the Commissioners or a higher authority.

    Where is the certainty?

    If determined it was after the third house say, his non reporting of all house sales post this is evasion.

    As something as simple as this cannot be determined as either avoidance or evasion how difficult is it to differentiate when looking a corporate group structures, offshore companies, transfer pricing etc?

    The thickness of the current Butterworths Orange and Yellow Tax Legistation Handbooks publication is now circa twice that when I started my apprenticeship, it speaks for itself. The only way to reduce artifical schemes getting through the gaps is simplify the legislation.
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    (Original post by Jacktri)
    rich business owners who move their wife abroad to countries with low tax rates and then transfer the business to her so he lives in the uk earning millions tax free
    I actually meant an example, since you said the £500m figure.

    How would the husband receive money which is not subject to taxation in the situation you gave?
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    (Original post by Jacktri)
    rich business owners who move their wife abroad to countries with low tax rates and then transfer the business to her so he lives in the uk earning millions tax free
    Any business trading in the UK whether incorporated, or otherwise, is liable to UK tax on UK profits from the trade. Either income tax or corporation tax.

    Their is a great amount of "man in bar" advice/discussion re this sort of thing,do not read everthing in the press re tax as gospel.

    Yes, higher rate tax can be avoided on dividends if they are paid to a non UK resident, however becoming non resident for tax in another country can , unless by dint of employment there, take some time, and of course the non resident party is liable to whatever tax arises on them in their country of residence.

    .
 
 
 
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