topics
tools
Expatica countries
editor's choice

Crime and the legal system in the UK

Tips for understanding the Brits

Banking in the UK

Culture and social etiquette in United Kingdom

Museums in London

Index Last Var.(%)
BEL 20 2076.17 -0.24
DAX 6293.35 -0.25
IBEX 30 6564.2 0.40
CAC 40 3002.47 -0.32
FTSE 100 5280.23 -1.09
AEX 289.05 -0.41
DJIA 12442.49 -1.24
Nasdaq 2813.69 -2.10
FTSE MIB 13109.04 0.15
TSX Composite 11330.68 0.04
ASX 4098.8 -2.61
Hang seng 18951.85 -1.30
Straits Times 2779.1 -1.54
ISEQ 20 484.76 -0.93
You are here: Home Finance & Business Banking Tax Evasion - We're All At It (Apparently)

Banking

archive
Enlarge font Decrease font Text size


23/03/2011Tax Evasion - We're All At It (Apparently)

Tax Evasion - We're All At It (Apparently) Blogger Tax Teddy shares his fears about the government's plans to target tax evaders.

You’ll like this one.

It seems some people aren’t paying as much tax as the government would like. However, they seem to have conveniently forgotten the ruling in the tax case involving the Duke of Westminster (from 1936) which established that it was the right of every man to arrange his affairs in such a way as to pay the least amount of tax.

Quite reasonable, you might think.

Not likely. The government is introducing plans to raise £7 billion a year from ‘tax evasion’. But the planned rules are so far-reaching that innocent taxpayers could end up being targeted by HM Revenue & Customs as illegally evading tax.

HMRC investigations will target offshore accounts, which is fair enough. But HMRC is using the word ‘avoidance’ to apply to any tax planning that is not in writing, so genuine use of offshore accounts falls into the net. HMRC are also expected to target those earning more than £150,000.

So if you earn £151k and bank with Barclays, Isle of Man - boy, are you in trouble.

On a serious note, TaxTeddy’s fear is that this draconian approach to tax avoidance will simply drive (legal) tax avoidance out of the hands of tax practitioners and accountants and take it underground - into the ‘black economy’ and illegal tax evasion. There is a fine line between legally planning to minimise your tax with the help of your accountant - or just not telling him about what you are really up to.

In some countries where tax evasion is rife, it is taken for granted that there are certain things you just don’t ever disclose to your accountant. So the honest taxpayers pay more tax to cover for those ‘dropping out’ of the system.

This already happens in some EU countries so don’t think it couldn’t happen here.


Tax TeddyTaxTeddy is a director of a small tax consultancy and he has created a blog to share his insights into UK tax law and practice. By cutting out the jargon TaxTeddy hopes to give his readers a better understanding of what is happening in tax administration in the UK, and sometimes other countries too.

 
You can find tax information especially for expats on the Expat FAQs page of the Cambridge Tax Practice website.

Tax Teddy / LB / Expatica



0 reactions to this article

Be the first person to add a comment

General rating: Not rated yet

Rate article:    Add my rating



0 reactions to this article

Be the first person to add a comment
Finance essentials
Finance expert Q&A
ask your question
Discussion Forums

Community Noticeboard United Kingdom

$100 MasterCard for Member with most new members

Community Noticeboard United Kingdom

Website for special needs and disabilities

Community Noticeboard United Kingdom

Military tour to Ukraine for football fans of Euro 2012

UK News

what do you think about the news of the world scandal

Community Noticeboard United Kingdom

SAP Business Objects Online Training in Netherlands by SAP BOSS

participate in the forums

Inside Expatica
Visas for coming to the UK

Visas for coming to the UK

Visa paperwork Whether you're relocating to the UK or just visiting, it's important that you find out in advance whether you need a visa.

An online guide for expats finding & purchasing a UK Property

An online guide for expats finding & purchasing a UK Property

Expat mortgages and everything to do with buying a UK property might sound complicated, but there’s plenty of help out there for you.

UK healthcare: Finding the right NHS service

UK healthcare: Finding the right NHS service

You can access the UK's National Health Service (NHS) in a range of ways. Here is an overview of the main services available to help you get the treatment you need.

Banking in the UK

Banking in the UK

Just moved to the UK? You'll need a bank account to effectively manage your money while you're here. Cliff Govender explains the UK banking system, including facilities that may come in handy down the line.