Would you avoid tax if you could?

JasonLVC

teffers wrote: »

In reality, as always, the people who have the money can afford solutions that save them a fortune and it's the rest of us that pay to run the country.

It costs less than £40 to register a Ltd company at Companies House. Once registered you are the Director of said company and you simply pay yourself a dividend instead of a salary.

Instantly halving your total tax liability. So, do you really need to be a millionaire to afford tax avoidance? Not at £40 you don't.

Example below, 35yr old male earning £25k a year - difference between dividend, straigjht salary or sole trader income.

http://www.uktaxcalculators.co.uk/dividend-vs-salary-result.php

cherylim

I wouldn't try to avoid paying tax/minimise tax payments at all, but I have nothing against those who do within legal limits. I think what Jimmy Carr did was fine.

Bridge72

I too don't have a problem with people using legitimate tax avoidance schemes to lower their tax liabilities, But I myself don't think that I would use them - although that is probably because I do not have as much money to invest or protect as the wealthy and big businesses using them.

stevemcol

I would suggest the government procures the services of the same accountants the tax avoiders use, to identify, advise and help close as many of the current loopholes as possible.
Every tax penny avoided by high earners is effectively stealing from or at best, further burdening the majority of tax payers on PAYE.

XRAT

Stephen_Leak wrote: »

Yes. I would.

I do. I have an ISA. I don't see any difference between what Jimmy Carr did and what I'm doing. Both are legal. Both were specifically designed to legally avoid paying income tax. As my ISA pays no tax, not the 1% or £300K of JC's scheme, I must therefore be even more "morally wrong". Thank you, David.

PS. I also can't wait to see the half-baked scheme Baronet Gideon dreams up to sort this, and then has to back track on.

The difference Stephen, is that your employer (presumably) paid 20% tax on the money you earned before he gave it to you. Before you put it in your ISA.
Jimmy was able to opt out of the tax system of the majority, because successive governments have chosen not to implement an efficient tax system. They choose instead to continue with a system designed to keep lawyers and accountants (and M.P.s of course) in grand houses.

XRAT

DalePie wrote: »

Avoiding as much tax as possible legally is perfectly fine. Many of us pay way too much anyway!

Avoiding tax illegally... that's not okay! Law is the law!

Dear DalePie,

The law is just a set of rules made by a group of people who think they are above complying with them, and who are too arrogant to realise that their rules have no meaning unless someone enforces them.

Until government provides sufficient HMRC/police officers to enforce the rules, we should cut back on the rules and the rulemakers.

There must be about 1 policeman per meter in Downing Street, but you try and find a Station open in your area! (Let alone a 'Bobby' on the beat.) Could that be anything to do with the amount of tax paid by the wealthy?

Stephen_Leak

XRAT wrote: »

The difference Stephen, is that your employer (presumably) paid 20% tax on the money you earned before he gave it to you. Before you put it in your ISA. <snip>

Whilst I do not wish to disagree with you, I must advise you that you are in error. The income tax avoided with an ISA is on the interest paid.

marleyboy

Without breaking the law, as a Moneysaver, I would do whatever it took to legally pay the MINIMUM amount of tax possible.

Saying this, if I won a triple rollover, I would be out of this Country like a shot, preferring not to contribute to this governments pockets in anyway whatsoever.

SINBAD_2

Cameron's father made all of his cash setting up tax avoidance schemes in Geneva, Panama, and Jersey. Probably paid for his son's Eton education. We're all in this together. Yeah bloody right!
http://www.guardian.co.uk/politics/2012/apr/20/cameron-family-tax-havens

zenmaster

JasonLVC wrote: »

It costs less than £40 to register a Ltd company at Companies House. Once registered you are the Director of said company and you simply pay yourself a dividend instead of a salary.

Instantly halving your total tax liability. So, do you really need to be a millionaire to afford tax avoidance? Not at £40 you don't.

Example below, 35yr old male earning £25k a year - difference between dividend, straigjht salary or sole trader income.

http://www.uktaxcalculators.co.uk/dividend-vs-salary-result.php

That link showed me that no-one, under any circumstances, earned anything or paid any tax. The shape of things to come?

I have a limited company. I could pay a salary below all thresholds and take most of my income as dividends, but I don't because I believe we are all in it together.

However, I do pay a mix of salary and dividends, purely because of the double whammy of employee + employer NI. If I could be a sole trader (a right denied me under previous legislation) this dilemma would not arise, but I can't, so I reach a compromise situation with my conscience to try and balance the books. I have to argue with my accountants every year.

I am not a director though. A benefit scam.

When I had no work for almost 6 months, despite paying Employees and Employers NI, I found I was not entitled to JSA as I was employed as a director, even though I was receiving a negative salary from that post.

I don't know why Jimmy Carr was singled out. Was Cameron asked a question which mentioned Carr by name or did he just victimise him? He wouldn't be the first - Ken Dodd and Lester Piggot spring to mind. One of which got off scott free and the other served time as I recall.

BTW, my limited company cost >£250 to set up in the days before t'internet.

PS: I also deduct a few £100 from the revenue's share in retaliation for their discriminatory stance against smokers, though I do not buy grey imported cigarettes.