The Rich According to the Guardian

[Judy1234]

www.guardian.co.uk/money/2008/aug/04/workandcareers.executivesalaries

to be fair there is a difference between 'ordinary' people attempting to budget/save by using ISAs and pensions etc as tax free savings, and people who earn millions simply paying someone to avoid paying lots of tax. Which does happen.

Aoivdance id legal. Evasion is illegal. There is nothing wrong with any mumsnet poster paying any sum to accountants she chooses to minimise her tax bill or even if she has half a brain finding out for herself how to make use of tax allowances, jurisdictional issues and the like. The trouble is women are just so notoriously useless at this kind of thing. Look at the mumsnet posts where they don't even know what pensions or bank accounts their husbands have and they say they are bored by it all. This is the issue to be tackled - making women understand money and be interested in it and indeed working in the outside world so they actually have some earnings which might be taxed.

For me morally I see no difference between someone rich and someone poor lawfully ensuring they pay the minimum tax which legally they are obliged to pay. Indeed there may be more justification morally for the rich to do it as they have already paid their fair whack and a half.

"Xenia in very high heels, stern glasses and perfectly coiffed hair". I do wear high heels. I don't wear classes and I think my hair is a bit of a mess at the moment but it can look okay once combed.

As for whether islands are luxuries or not - can't we regard it as preservation of the planet (the rain forest on it), the most charitable planet friendly thing you can do - buy rain forest and preserve it? Shouldn't I get a tax break for buying it?

TD, tell me more. It would be good to be debt free post my divorce.

Xenia you're so right. I'm sorry I misjudged you, of course you only did it to be eco-friendly. I shall stop recycling any scrap metal I have, sell it and buy an island immediately.

Dittany That HMRC link doesn't say anything to support your argument - the main thrust is that HMRC's Anti-Avoidance strategy is
"making tax law robust against avoidance". HMRC lost tax test cases all the time. They are not themselves above the law you know?

Tax practitioners work within the law. I agree that sometimes they sail close to the wind of what might be considered fair but most of the time they are just looking for the best deal for their client. It's a bit like buying a pair of Boots in TKMAxx as opposed to buying them in the designer shop - is that tax (VAT) evasion?

Dittany - Your income tax/other tax distinction is totally nonsensical and ridiculous. If I bought a company and did not need to draw an income, why should I? (perhaps I have a huge shed of a share portfolio and live off disposals (on which I would pay tax?) The fact that Dittany thinks income tax is somehow worthier than Corporation tax or Capital Gains Tax or any other tax is perfectly laughable.

Quattro - What are you doing this weekend? I'm thinking of a bit of gardening and a bit of tax avoidance.

You simply don't understand Dittany. That link does not prove what you say it does (though well done for googling). What it does, is demonstrate exactly what the indicators are for avoidance. If you'd actually read your OWN link you would start to appreciate what constitutes avoidance.

Avoidance is NOT the use of perfectly legitimate allowances and reliefs.

Avoidance IS the use of legal but highly artificial structures to artificially avoid tax that should be due. Making use of unintentional loopholes, twisting facts and legislation etc to try and save a quick buck. To be honest, it is mainly public companies who do this type of stuff, using yen derivatives, artificially injecting substance into shell companies blah blah.

I don't know whether you are confusing avoidance with using reliefs and allowances deliberately or wilfully. I suspect you must be, but I am at a loss as to why you think this advances your argument.

Ah, well Swedes, actually I really and truly was going to tackle an untidy pile of papers, unopened envelopes and receipts in order to do my tax return.

I'm not going to indulge in any evasion or avoidance, but I am going to claim all the allowances and reliefs I am due. Including claiming my personal allowance, claiming relief for my pension contributions, capital allowances and professional subscriptions.

Dittany I mean that HMRC lose tax cases in the courts - often. They have to stick to the rules. Parliament could at any time introuduce legislation for a a presumption of anti-avoidance which would run through all tax legislation. This sounds wonderful to people like Dittany but those in the know look at the big picture and see all its undesirable consequences.

Riven

All interest income is subject to tax, unless you either (a) invest in an ISA or other tax exempt vehicle or (b) you are not a taxpayer.

It's not a big deal to the 400 household because our savings are pitifully small, but many retirees live on interest income they've accumulated through savings and lump sums on retirement etc.

Last post on this, because I need to get on and do some work, BUT let's dissect the examples of avoidance you've given:

"Putting your money in offshore tax havens to avoid CGT or income tax" - well depositing funds offshore is nothing to do with CGT. It wouldn't avoid income tax for UK domiciled individuals. You are muddled on this point.

"Claiming non-dom when you are nothing of the sort". This is not avoidance, this is fraud on the revenue and anyone trying to do anything of the sort could end up in prison. This is not avoidance. You are muddled on this point.

"Getting your bonus paid in commodities which at one point weren't taxed (I don't know about now)" Bingo Dittany, one out of three ain't bad. This actually was an example of an avoidance scheme. It doesn't work any more though.

Oh well if Vince Cable agrees with you (which he doesn't btw, having read the article and compared it to your muddled arguments) then you must be right.

I'll have to remember Vince Cable as an authority. Better than any statute obv...

Dittany - You need to brush up on your tax terminology. I think you are confusing residence and domicile.

Maybe this will help you