to think that 100% of MNers probably avoid tax?

[TravellingToad]

Just watching a frustrating debate on TV about a man who has legally taken advantage of a loophole permitted by the government in order to reduce his tax bill. Some people in the debate are on their high horse.

Now it occurs to me that unless you voluntarily hand back your tax allowance (roughly £10,000 per person) you are in no position to squawk about other people avoiding tax.

The £10,000 tax allowance is a legal tax avoidance loophole permitted by the government that means that you can assign £10,000 a year of your income and pay NO tax on it. 99.9% of people i'm sure grab it with open arms.

Anyone here voluntarily pay the tax instead of accepting the avoidance scheme? Anyone of you phone your accountant and say "I don't want to use that loophole thanks please donate the tax to the government instead" No? thought not.

I expect i'm about to get leapt on now with cries of "oh its so different though because he's so rich and I only earn £20k a year" but where do you draw the line? To the homeless person on the street you are rich beyond their wildest dreams, just as gary barlow seems to you. At what point does it become one rule for you and one for anyone richer than you?

Let the slaughter begin!

The very basic point is that if you're rich enough you get to pay proportionally less tax than someone on minimum wage.

Anyone who doesn't think that's entirely wrong is an evil capitalist bloodsucker who will rot in hell for eternity having their anus pumped by piers Morgan

A loophole is an unintended benefit of a rule which allows a person to avoid the impact of that rule.

An example given in Wikipedia is that Ford builds passenger vehicles in Turkey, then ships them to Baltimore, fully intending to rip out the passenger seats seat belts and rear windows, before fitting solid panels. It costs them hundreds of dollars per vehicle but avoids a 25% tax on the import of light goods vehicles.

The tax free £10,000 is an allowance, intended to be used exactly as it is given.

ISAs ARE an artificial construct! The whole tax system is an artificial structure. There is no defining line between legitimate allowances and loopholes, if there's a way for people to reduce the amount of tax they have to pay then it's open to people to creatively use it to reduce their exposure to taxation. The only way to completely prevent this would be to have flat tax. Or no tax.

Well why would what Gary Barlow did be entirely legal? At the end of the day he paid as little tax as possible. My point was that you all do the same. You happily accept all the ways the government permit you to pay the least tax possible. By an allowance or a loophole or any other word you pin on it. So did Gary.

An ISA sounds like a loophole to me. Just a popular one rather than a little known one. .

Well, yeah, DH has a tax allowance and I earn so little in the voluntary role I fit in around being a carer that I don't pay tax on wages or savings interest.

It's a wee bit different from sneakily avoiding paying tax on a few million a year, though, via loopholes and schemes more evasive than simply avoidant.

I don't pay as little tax as possible. I could use childcare vouchers, but haven't gotten round to it.

And lets say someone on minimum wage is justified in paying as little tax as possible, but a millionaire like Barlow isn't. At what point on the imaginary line between the two does paying the minimum amount of tax possible become wrong?

Are you Gary Barlow, OP? Or his wife?

Serious question.

An ISA is not a loophole! It's a government endorsed tax efficient saving vehicle.

Everybody gets that 10k allowance, even Gary Barlow, so it's hardly a tax avoidance strategy.

You don't seem to understand.

tuscon I believe it's once someone earns more than the person doing the complaining.

Not everyone gets a personal allowance any more.

lougle when you say government endorsed do you mean "legal"? because so was this.

COPY AND PASTED FROM THIS SITE

What is the difference between tax evasion and tax avoidance?

Tax evasion is about breaking the law: not declaring income or claiming expenses inappropriately.
WRONG

Tax avoidance is about getting around the law: finding loopholes and abuses never intended by parliament e.g. by routing income through a tax haven.

WRONG

Tax planning is about choosing between the options intended you should have available to you e.g. between saving in a pension or ISA
Ok

Tax dodgers are dodgy.

ISAs are shite anyway. If you're not earning enough to have to pay tax, there's much better regular savings accounts.

Tuscon - a millionaire gets to legally avoid paying tax on the same £10,000 as a cleaner or shop assistant working all hours possible. Everything above that is the problem.

Well a cleaner could also presumably (if they're self employed) use the same system as Gary if they wanted?

That's right lk8, because we have different views I'm not clever enough to cross the road. That's how the rules work I believe on road crossing. An IQ test measured against your intelligence :) Excellent point, well made.

You're not being unreasonable, you just fundamentally misunderstand tax.

There's tax evasion, tax avoidance, and tax planning. Evasion is breaking the law. Avoidance is manipulating the laws in unintended ways. That doesn't mean it is legal - the courts will decide.

Tax planning is using ISAs, drawing a dividend rather than salary, using gift aid, etc etc. Nothing at all like tax avoidance.

Your example - personal allowance - is none of those. It's not even tax planning. I get a personal allowance but not because I've structured my tax affairs that way, it's just because that's how income tax works.

This thread is the biggest load and of bullshit ever. Utterly misguided and spectacularly missing the point. I congratulate you, OP, on a monumental failure of basic common sense.

As far as I know, there is no question that what Barlow did was illegal.

The only argument is that what he did was immoral. I would say to anyone getting on their high horse that the definition of a fair tax system is one where everyone pays the same amount of tax.

If you don't think Barlow pays enough tax, why don't you pay his tax bill and he can pay yours?

Have you stopped to ask yourself why anyone would want to pay £15m in tax that they could LEGALLY avoid? What would he get in return? His bins emptied!

Perhaps you think people should pay more if they can afford to do so? Well, if you saved any money last year, or if you went on holiday or treated yourself to ANYTHING whatsoever....... guess what? You could afford to pay more tax too. So why don't you donate your savings to the government?

Paying on the basis of affordability is not fair and never has been. If it was, the same system would be prevalent in the private sector. If you and a mate went on the same holiday, but you were on £50k per year and your friend was on £25k per year, should you pay double for the holiday?

Every time you went to the supermarket, the checkout operator would have to ask you how much you earned before they decided how much a fair price would be.

The truth is that most people are very jealous and very bitter of people that do well for themselves.

I note you ignored the hard bit of my post with my argument. Too taxing was it? :)

insertrandomnamehere i've said already, I was being of course facetious. Believe it or not I do understand what the tax allowance is. I'm trying to say that I doubt anyone on this thread pays more tax than they have to. Thats all gary did. He didn't pay any more tax than he had to, within the law.

People gleefully use childcare vouchers, ISAs etc (ok maybe they would have been better examples) to maximise money in their own pocket. We're all human. Money in our pocket is what we want.

YABU Toad and a little bit mad tbh.