to be a bit pissed off that Gary Barlow has been involved in tax avoidance?(120 Posts)
I thought he was supposed to be a national treasure?
From The Mirror:
Gary Barlow and two other Take That stars face having to pay back tens of millions of pounds in tax after a court ruled they were part of a massive tax avoidance scheme.
The singer-songwriter, Howard Donald, Mark Owen and manager Jonathan Wild poured £66million into two partnerships styled as music-industry investment schemes.
But the ventures were artificial tax shelters for the super-rich which allowed the musicians to avoid tax on about £63million from world tours and CD sales.
The Take That members are likely to be ordered to repay more than £20million to HM Revenue & Customs.
Tax judge Colin Bishopp rejected arguments that more than 50 partnerships, set up by a company called Icebreaker Management, had been set up for commercial purposes.
He said: “Icebreaker is, and was known and understood by all concerned to be, a tax avoidance scheme.
“The aim was to secure [tax] relief for members, and to inflate the scale of the relief by unnecessary borrowing.”
Gaby Logan and Colin Jackson have also been earmarked by HMRC and will pay back after using this scheme. This is probably the tip of the iceberg.
There seems to be some misunderstanding of tax avoidance and tax planning, and it is to do with intention. HMRC have a simple explanation published:
Tax avoidance is an attempt to exploit legislation to gain a tax advantage that was never intended. This often involves artificial transactions that serve little or no purpose other than to produce a tax advantage.
But tax avoidance is not the same as tax planning, which involves applying tax legislation in the way it was intended - for example saving in an ISA (Individual Savings Account) where you don't pay tax on the interest.
I have no issue with businesses and individuals using tax planning, it is legal and what the law sets out to achieve, i.e tax incentives usually to encourage investment, savings and business efficiency.
Take a look at the portfolio of musicians in the Icebreaker Scheme on the website, would you honestly have invested £300million (fund size) into them? Most of them would be touring in 80s festivals and well past their chart topping days.
Well, yes they are going to come out and say that in defence. Was the scheme an investment vehicle also? Maybe thats why they felt justified in saying this.
Yes, but if they had got away with it the tax-take would have suffered. More power to HMRC's elbow in challenging these schemes and collecting the money when they succeeds.
It was the suggestion that HMRC was somehow doing down the music industry buy even challenging the scheme which pissed me off.
Andrew I have not had an additional tax demand, neither has DH.
This is simply not true HMRC will now pursue to collect tax from the income put into this scheme that the court has now deemed taxable.
If I were JO I would be giving my DB a great big hug and myself a pat on the back.
Jason is a bit of an old hippy and I love him for that. I think his brother is an accountant and he keeps everything really simple and "ethical" for him. The others could do with taking a leaf out of his book.
Jason Orange must be delighted what ever the reason, he didn't get involved in it.
My first thought when I heard this, was about Jason Orange.
Did the others not tell him, because he wasn't around (or they didn't like him), or, was he aware, but decided not to join in? If its the latter, he's the real star.
All of us, andsmile - if A avoids tax then B, C, D, E must pay more to achieve the same tax-take.
Which other taxpayers are being asked to pay their tax?
This is the best bit, or perhaps the worst:
A spokesman for Icebreaker Management said "This decision puts valuable funding for the UK's independent music industry in jeopardy.
So the "industry" needs to avoid its taxes - that is, it needs other taxpayers to pay its taxes for it - to survive?
We'll get by without them.
thats a good point that if GB now pays what is owed, he hasnt actually done anything wrong in terms of doing people out of funding stuff as suggested up thread
I already have a rough understanding of the difference between tax avoidance and tax evasion and the fact that the matter we're discussing was put before a tribunal which was not deciding upon the matter as a criminal offence.
Joni - tax evasion (which taking cash in hand is if it is not then declared) is a crime. Tax avoidance (which is what this scheme was designed to do) isn't. After being examined, the scheme has been deemed to not be appropriate and therefore tax is now owed. If GB pays what HMRC now asks for, he has not evaded any tax. He is perhaps doing something that some people (including me) would not do - putting money into complex schemes to avoid tax - but there is no intention to evade with these schemes. Cash in hand with an intention to not declare is always tax evasion and always a crime regardless of how much money that person has.
No squoosh I have stated that in post that is not what Im getting at.
We have a progressive tax system - if you earn more you are taxed more at a much higher rate - double, loss of personal allowance at 110k isn.
My point is if we didnt have high income earners like GB who makes money from worldwide sales - ie that taxable income comes from outside our own economy then we would not have as high revenues to spend.
Attracting rich people to be in the UK to tax them is a desirable and keeping them.
The government tred a fine line between taxing high income groups enough and keeping them here as domiciled residents for tax purposes.
If you earned 1 million and had to pay half to the HMRC and had a way of avoiding payign 5% would you not take it?
Evertonmint There is nothing in my post to suggest that I think it's ok for anybody not to pay their tax. I pay mine and it irritates me when I hear about other people no matter what their financial status is, who don't pay theirs. That being the case, there is no need whatsoever for you to be gob smacked.
However, in view of the massive rise in the cost of living I can understand why some people at the lower end of the economic food chain are asking to be paid cash in hand. The very wealthy, the likes of Gary Barlow et al, who engage in creative practices to limit their tax avoidance are just being greedy IMO.
The analogy you draw with drink driving isn't a good one. In that case the offence is that a person died, whether you a re driving a knackered old banger or a Range Rovef. Tax evasion is an economic crime, the severity iof which is judged by the benefit to the defendant. Thus a person who evades to the tune of millions is in fact more culpable that somebody who evades their tax liabilibity on a much smaller scale.
I too have been trying to absorb joni's comment.
Apart from the fact that a lot of tradesmen are comparatively well off nowadays, the law applies to everyone.
I do take the point on board, that if someone is destitute, leniency may be called for.
But if everyone across the land did what you are suggesting, not much tax would be paid by anyone!
'People seem to forget that the so called rich people actually work hard to earn that money in the first place.'
That's like saying low earners are poor because they don't work hard enough. Not all rich people are rich because they work so very hard.
The rich do pay a lot of tax, if a lot of 'rich' people that some complain about stopped earning that income and therefore reducing the ability to pay in substantially more in one year than most in a lifetime there would be seriusly reduced revenues available to pay for services we all access.
People seem to forget that the so called rich people actually work hard to earn that money in the first place. I am not saying people who earn less work any less hard just that they work hard.
man yep dont even go there on dual contracts and whether the work was acutally carried out in a nondome residence or not. Like I said much earlier tax is not as straight forward as calculating a percentage. There are many what if's to apply in varied circumstances.
Joni - are you really truly saying it's ok for people to break the law if they don't have much money? Really? I'm actually gobsmacked!
So tax evasion is fine if you don't have much money but tax avoidance isn't fine if you're rich? Really?
That's like saying drunk driving is ok if you're poor but being a bit drunk in public even if you're not driving when you're rich is much worse.
One is illegal, one isn't. The amount of money someone has doesn't come into it.
Evertonmint it's all relative though. The tradesman is probably struggling to pay his mortgage whereas GB has millions in the bank.
I knew that I would get a complicated answer!
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