Should Gary Barlow return his OBE?

[Castiel]

What has that got to do with anything?

The thread is about Tax avoidance.

It also is pertinent to the argument that a contractor is necessarily worse off than the salaried man...that is not always the case, while the salaried man potentially has benefits such as employer funded sick pay and pensions, the contractor potentially has far greater income despite this...it also give the contractor, through his tax liabilities the opportunity to offset a greater proportion of his income against his liabilities therefore paying less tax as an individual than a comparable salaried man.

The accountant you've paid would then pay the due tax on his profits?

Indeed....however in the context of the thread those profits could be offset by the liabilities through tax avoidance schemes...it illustrates that it is not the sole practice of the wealthy and famous who hit the headlines. Tax Avoidance is a common practice of virtually everyone.

 

[jimjamuk]

Presuming said contractor can find enough work - there are no guarantees of a job or contract these days.

Lets say an accountant is £1000 / year. I'd rather have the £1000 in the company account and not spend than it being a tax deductible expense where I'm a grand down but have saved £200 (20% small business rate) on my company tax bill.

 

[jimjamuk]

The thread is about Tax avoidance.

It also is pertinent to the argument that a contractor is necessarily worse off than the salaried man...that is not always the case, while the salaried man potentially has benefits such as employer funded sick pay and pensions, the contractor potentially has far greater income despite this...it also give the contractor, through his tax liabilities the opportunity to offset a greater proportion of his income against his liabilities therefore paying less tax as an individual than a comparable salaried man.



Indeed....however in the context of the thread those profits could be offset by the liabilities through tax avoidance schemes...it illustrates that it is not the sole practice of the wealthy and famous who hit the headlines. Tax Avoidance is a common practice of virtually everyone.

Although I completely agree it is the potential that is there - in the real world that does occur in times of boom but not in times of bust

 

[Castiel]

Although I completely agree it is the potential that is there - in the real world that does occur in times of boom but not in times of bust

I think that it is more likely to occur in times of economic stress, simply because the individual is more aware of the necessity to save wherever possible.

Accountants boom in times of bust.

Of course this relies on the contractor being employed, which is obviously more difficult (depending on their occupation) in economically difficult environments...this is also true of Salaried Employees however, whose jobs are often replaced by contractors by companies seeking to limit their own long term liabilities.

 

[kitch9]

The thread is about Tax avoidance.

It also is pertinent to the argument that a contractor is necessarily worse off than the salaried man...that is not always the case, while the salaried man potentially has benefits such as employer funded sick pay and pensions, the contractor potentially has far greater income despite this...it also give the contractor, through his tax liabilities the opportunity to offset a greater proportion of his income against his liabilities therefore paying less tax as an individual than a comparable salaried man.



Indeed....however in the context of the thread those profits could be offset by the liabilities through tax avoidance schemes...it illustrates that it is not the sole practice of the wealthy and famous who hit the headlines. Tax Avoidance is a common practice of virtually everyone.

The tax system is geared so the self employed pays tax on their net earnings. Claiming a legitimate expense allowed under law is not tax avoidance.

 

[csmager]

The tax system is geared so the self employed pays tax on their net earnings. Claiming a legitimate expense allowed under law is not tax avoidance.

It is. You could not bother claiming it - either deliberately or through ignorance - and pay more tax. Tax avoidance it not an illegal activity.

 

[Janesy B]

If I had a lot of money and was earning a lot I would do anything legal to make sure I pay as little tax as possible. Bite me.

 

[easyrider]

If I had a lot of money and was earning a lot I would do anything legal to make sure I pay as little tax as possible. Bite me.

You wouldn't be preaching to the masses ...struggling to pay their heating bills to give to charity though.

I'm alright jack.....keep your hands of my stack

 

[d_brennen]

Why on earth would you pay more tax than you HAVE to? Hate the game, not the player, y0

 

[muon]

Why on earth would you pay more tax than you HAVE to? Hate the game, not the player, y0

Some things are just using "holes" in a system.

Jimmy Carr for example is the example used a lot. Was that an example of something which is acceptable?

Was the tax system designed to tax individuals with high incomes at 1%? No.

Is the person using such a loophole exempt from criticism? No. Why? Because a lot of people would never use such an arrangement because it is clearly abuse of an imperfect system (and that includes me).

 

[bsoltan]

You wouldn't be preaching to the masses ...struggling to pay their heating bills to give to charity though.

I'm alright jack.....keep your hands of my stack

It's not like he is going to people's houses forcing them into giving away money.

People can do as they please with their money.

 

[muon]

If I had a lot of money and was earning a lot I would do anything legal to make sure I pay as little tax as possible. Bite me.

People will bite you. Don't hide behind an innocent face when they do. Don't pretend that you are being targeted unfairly.

 

[Pudney]

The tax system is geared so the self employed pays tax on their net earnings. Claiming a legitimate expense allowed under law is not tax avoidance.

So does Gary Barlow.

 

[Stretch]

Why on earth would you pay more tax than you HAVE to? Hate the game, not the player, y0

That is correct. However I would add this.

How about we change the game.

The current game can only really be played but the wealthy, which is fundamentally unjust.

The government will never be able to keep pace with the game. Chronic loopholes (especially involving tax havens we can influence e.g. Jersey) should be shut down, or if (as this appears to be) it's a case of blatant abuse of the system, it should be possible to seize money, review the case, and apply tax retrospectively under tighter rules but not new rates.

 

[Castiel]

The tax system is geared so the self employed pays tax on their net earnings. Claiming a legitimate expense allowed under law is not tax avoidance.

By definition it is the same. Tax Avoidance is the legal use of the tax regime to reduce your tax liability. As Dimple pointed out with his own examples.

Do not confuse tax avoidance, with tax evasion.

 

[muon]

By definition it is the same. Tax Avoidance is the legal use of the tax regime to reduce your tax liability. As Dimple pointed out with his own examples.

Do not confuse tax avoidance, with tax evasion.

You know what he meant though. The terminology may be off but he is referring to avoidance of tax where it wasn't intended.

Otherwise it isn't really tax "avoidance" as it was never tax you should be paying anyway.

The legal term and it's use in a sentence doesn't have to be the same. There is no clear definition as you put it. "Tax" has a definition and and "Avoidance" has a definition. When put together there may be a legal definition but it doesn't have to mean that in a casual environment.

 

[Castiel]

You know what he meant though. The terminology may be off but he is referring to avoidance of tax where it wasn't intended.

Otherwise it isn't really tax "avoidance" as it was never tax you should be paying anyway.

The legal term and it's use in a sentence doesn't have to be the same.

I know what he meant, I replied in context. Mitigating your tax liability in a way permitted by the law is by definition, legitimate. Whether that is by claiming a business expense or other legal means of reducing your tax liability. It is allowed under law, just as he stated.

 

[jimjamuk]

and apply tax retrospectively under tighter rules but not new rates.

Now that is a scary thought and I know it is being applied. If someone was attempting to follow the rules of a game, albeit testing the boundaries of those rules at which point do you think its fair for the person in charge to not only change the rules (which I would consider Ok) but to change those rules and decide that you've been breaking those rules in the past. Ignoring tax imagine if a new football rule was introduced today but backdated to the start of the season.

Retrospective taxation is a big step over that red line if you ask me

 

[Janesy B]

People will bite you. Don't hide behind an innocent face when they do. Don't pretend that you are being targeted unfairly.

I won't. I'll spend the money saved on printing exactly how I did it to wind up all the stupid poor people that read the tabloids.

You wouldn't be preaching to the masses ...struggling to pay their heating bills to give to charity though.

I'm alright jack.....keep your hands of my stack

How do you know he hasn't donated?

 

[Sin_Chase]

I avoid as much Tax as I possibly can, it's legal. I would do it no matter my income. Everyone should do it, anyone giving people a hard time for doing something legal needs to go take a hike.