02-16-2019, 12:08 PM | #1 |
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Tax avoiders protest at having to pay tax!
This seems a pretty odd story to me. The gist being a whole bunch of people used aggressive tax avoidance by being paid into a trust and then 'loaning' themselves money from the trust to avoid income tax, with no intention to ever repay the loan.
Many years later this artificial construct is ruled not to work, i.e. the income tax is still due. The bit I don't understand is that these tax avoiders then choose to have a public protest at the decision of HMRC to come after them for the unpaid income tax. Who, other than fellow tax avoiders, are going to have any sympathy with them at all? I would have thought that 99.9% of those who didn't take part in this would support the HMRC applying the thumbscrews... Have I missed something? https://www.theguardian.com/money/20...voidance-bills |
02-16-2019, 12:29 PM | #2 |
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So people thought that they could get away with not paying income tax and now not happy that they’ve been told that they should like any other working person? What’s really annoying is that they blame the advice they received but not themselves, any person would think twice if they were told that they don’t need to pay tax on their income
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02-16-2019, 12:35 PM | #3 |
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I don't know enough about it but it's not a straight forward as someone taking cash in hand and not declaring it but having said that:
I don't understand why they didn't get paid and then give their tax due to HMRC via an accountant straight up no messing, they didn't need to enter into these schemes but chose to. They will have known they were paying less and they should have realised that the tax man can come after you retrospectively, I have a good friend that is being chased for 250k for entering into a scheme, the only winners here are the accountants that push this stuff, they get the fees and walk away they should also be chased for the fees they got that would stop them pedalling schemes in the first place. I do feel sorry for those that are pushed to the edge or beyond for trusting these so called advisors, they are real shysters.
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02-16-2019, 12:37 PM | #4 |
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I was offered to be part of one of these 'loan' schemes back in the day.
I read the paperwork, and it was very clearly worded that if HMRC did, at some point in the future, rule the scheme to be illegal, then I and only I would be responsible for all the tax due. Needless to say, I refused to sign up to it. Hate to say it, but 99%+ of the people in this scheme knew exactly what they were doing. Chickens, home, roost. In other words, suck it up, princesses. |
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02-16-2019, 12:41 PM | #5 |
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Looks like tax has come home to roost. I'm sure it is devastating for some as it is all being declared due 'at once' but it's sort of hard to feel sorry for the guy who now owes £400k tax at the most extreme example.
So if that's the tax due the earning must have been > £1M. 'Millionaire' dodges tax (yes I'll use the term loosely Gets found out Had to pay it back Tough luck pal Interesting read, cheers JD6.
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02-16-2019, 01:11 PM | #6 | |
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02-16-2019, 01:16 PM | #7 |
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Heh, wonder how many people spent the tax 'savings' on expensive PCPs, nice holidays, etc., while the rest of us were paying our tax properly
Fuck all to show for it now, and a huge tax bill. Karma is a bitch, isn't she. |
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02-16-2019, 01:17 PM | #8 | ||
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Earning 6 figures over 10 years and paying naff all tax is very big money indeed. I get what you mean though, in that it's incremental, but quite how people can expect there would be no come back??? Hmm they had too much faith in their accountants clever tax avoidance.
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02-16-2019, 01:35 PM | #9 | |||
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They still conniving and foolish, but nowhere near as bad as the likes of Lewis Hamilton dodging taxes! |
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02-16-2019, 04:03 PM | #10 | |
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However, Hamilton is a non-resident of the UK (as he is legally entitled to be, as his work is truly international), so his income tax situation all looks to be above board. |
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02-16-2019, 04:10 PM | #11 |
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I don’t pay tax on my second income, it’s a bit of a risk I suppose and if I got collared 10 years later after I’d blown the lot I’d be pretty miffed!
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02-16-2019, 04:46 PM | #12 |
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I have to say having been contracting for a number of years I've been offered a number of" legal and approved by barristers" schemes, this being one of them.
All have been declined as its obvious how ever long it takes HMRC will catch up and demand back tax. |
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02-16-2019, 04:49 PM | #13 | |
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Move assets to a partner, etc ? They don't care, you've concealed the assets as far as they're concerned, and they'd get court orders seizing them anyway. Fail to pay up ? Bankruptcy, and they watch you like a hawk for the next 20 years, to see if you'd kept anything hidden away. They find it, it's more time in court / bankruptcy all over again Seriously, HMRC are one part of government you do not fuck with. They will happily leave you in rags on the street if you defraud them. No time limit either on tax evasion, they can come after you in 20 or 30 years. I'd seriously consider 'coming clean' with them, and settling what you owe. Unless you are absolutely convinced that they would never find it, and absolutely nobody knows about it that could inform them about it. |
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02-16-2019, 05:04 PM | #14 | ||
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02-17-2019, 05:25 AM | #16 | |
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For me, the benefit of HMRC very publicly going after avoidance/evasion goes well beyond the sums they bring in in that particular exercise. It sends a very clear message to society that there is nowhere to hide. It must serve to put people off going into these schemes. No doubt big corporations who can afford the best tax advisers still get away with some aggressive avoidance, but even there HMRC or the government seem to be making life harder for them. I assume that leaking to the media is part of the strategy. |
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02-17-2019, 06:15 AM | #17 |
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My wife recently had a letter to say she has 2k unpaid tax from over a decade ago. A PAYE error by her employer at the time. We (I) would happily pay that outstanding but they want over 10k in penalties even though it was buried in their archives for that long.
My tax accountant is dealing with it but they aren't backing down even with the offer to pay the tax but not the penalty. Technically she is unemployed with two children (given that HMRC cannot link my financial status, so the accountant tells me) which is frightening. Fine for us, 12k would sting but wouldn't be life changing. But what about someone in a less fortunate position. |
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02-17-2019, 06:29 AM | #18 | |
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I'm all for penalties to discourage aggressive tax avoidance, but HMRC need to differentiate between genuine mistakes (particularly by someone else) and avoidance. I have had occasional negotiations with HMRC in the past, partly due to the way a former employer used to structure bonuses to avoid employer NICs, but I have always found them to take a reasonable approach. I hope that doesn't change as a result of this crackdown on avoidance. |
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02-17-2019, 04:01 PM | #19 | |
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02-17-2019, 05:02 PM | #20 | |
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02-19-2019, 10:35 AM | #21 |
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Interesting to read that some in the UK still think that savings are a good idea. Other than me (an ex-pat) I can only name one in my social circle who wouldn't be wiped out by a demand for 12k, be it dollars or sterling. I suspect many couldn't raise 1,200 either.
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