Can I legally avoid paying tax?

jimmyjimmycocopops

thorsoak wrote: »

Legally, you might possibly find some scam (sorry scheme) that might save you some tax ...but how much that would be after you've paid the accountants/lawyers might be negligible.

But morally?

Honestly I think the moral question belongs in a thread of its own, and I'm surprised how many times it's come up.

All I'm trying to figure out is how to pay the minimum possible tax on my income, in the same way anybody would look to pay the minimum possible tax on savings/pensions/inheritance/buying a property etc.

Fulham_Mark

The idea of someone asking how to pay less tax naturally created replies about how taxes are needed to pay for public services etc.

However, when people retire early, go travelling for a year in their 20s or 30s, or decide not to return to work after starting a family then surely the same is true. You've decided to pay less tax than before.

This is the risk with raising taxes sharply rather than slowly, as you could trigger lots of people who currently pay taxes to stop working. They probabaly can't wait either since they're in high stress or high risk jobs such as oil rig workers! If you do eat the rich then the taxes they paid have to be paid by all the lowly people out there.

Also I think it's fairer to say that wealthy people avoid taxes that are aimed at wealthy people - e.g. inheritance tax. The income tax rate is switzerland is 30% or so.

RobertoMoir

thorsoak wrote: »

Legally, you might possibly find some scam (sorry scheme) that might save you some tax ...but how much that would be after you've paid the accountants/lawyers might be negligible.

But morally?

Morally its perfectly fine to pay the minimum amount of tax you are required to pay. What's wrong with that?

Avoiding tax liability is both legally and morally acceptable.

Evading tax is both illegal and morally unacceptable.

The OP appears to be talking about tax avoidance.

NiceGuyEddie_2

RobertoMoir wrote: »

Morally its perfectly fine to pay the minimum amount of tax you are required to pay. What's wrong with that?
Avoiding tax liability is both legally and morally acceptable.

Evading tax is both illegal and morally unacceptable.

I'm aware this will probably be dismissed as pedanticism, but this has been a topic of much debate in the accountancy and tax profession in recent years.

Tax avoidance is legal, yes (assuming you comply with AA laws, obviously!) but it's morality is not so clear cut and there's been a considerable shift towards considering avoidance to be as 'wrong' as evasion.

I hope it never becomes that though, as I'd probably be out of a job


Back to the OP, when considering your options I'd strongly advise you to bear the following in mind: Don't let the tax tail wag the dog.

The option which results in the greatest tax saving may not be the option which results in greatest net income, which I presume is what you're looking for?

RobertoMoir

NiceGuyEddie wrote: »

I'm aware this will probably be dismissed as pedanticism, but this has been a topic of much debate in the accountancy and tax profession in recent years.

Ah.. *recent* years. I worked for the IR *years* ago. I guess things have changed - while we were obviously out to collect what we could it was considered fair game for the taxpayer to avoid liability wherever they could.

Tax avoidance is legal, yes (assuming you comply with AA laws, obviously!) but it's morality is not so clear cut and there's been a considerable shift towards considering avoidance to be as 'wrong' as evasion.

I hope it never becomes that though, as I'd probably be out of a job

I stand corrected... thank you! Is it fair of me to say this is the split between avoiding liability by good financial planning (ok), and avoiding liability by working the rules and playing games (not so good)?

Back to the OP, when considering your options I'd strongly advise you to bear the following in mind: Don't let the tax tail wag the dog.

That's fantastic advice right there. The objective isn't to minimise the tax paid, it's to maximise the money in one's pocket... not always the same thing.