The UK Tax gap, visualised

[Fume troll]

Quite interesting:



Cheers,

FT.

[Wadeski]

so basically, invade Guernsey and the I.O.M. and we wipe out the official tax gap? I mean surely the Boy Scouts could achieve that!

[TEKNOPUG]

Wadeski said:

so basically, invade Guernsey and the I.O.M. and we wipe out the official tax gap? I mean surely the Hitler Youth achieved that!

EFA

[DonkeyApple]

Fume troll said:

Quite interesting:



Cheers,

FT.

This is quite a relief. I'll just send HMRC a cheque for £102 and everyone is sorted. No need for thanks but maybe I could have a statue on the 4th plinth?

[TuxRacer]

Just me that thinks that's a dreadful chart?

[BonzoG]

TuxRacer said:

Just me that thinks that's a dreadful chart?

No, Information might be beautiful but that chart is sodding horrible.

[Engineer1]

FFS another thread where Tax Avoidance is picked, up if it is Tax Avoidance the tax wasn't actually owed.

[Fume troll]

Engineer1 said:

FFS another thread where Tax Avoidance is picked, up if it is Tax Avoidance the tax wasn't actually owed.

Not if it actually was owed...

Cheers,

FT.

[TuxRacer]

That's tax evasion.

[Fume troll]

I suppose in this context avoidance means exploiting options which HMRC tried to avoid creating, and would prefer closed.

Or more clearly: "Tax avoidance is a course of action designed to conflict with or defeat the evident intention of Parliament".

Cheers,

FT.

[Oakey]

said:

Understanding How ISAs Work
If you are looking for an effective way to save or invest funds without allowing the taxman to eat up your profits, consider an Individual Savings Account, or an ISA.

ISAs were designed more than a decade ago to encourage Brits to save for college, retirement or a rainy day. The earnings made on ISAs, whether through interest or the sale of shares, are completely tax free. In fact, these funds do not even need to be reported on your income tax return each year.

Really, this should be changed to reflect todays climate, so it should read;

said:

Understanding How ISAs Work
If you are looking for an effective way to save or invest funds without paying your 'fair share' to the taxman, consider an Individual Savings Account, or an ISA.

ISAs were designed more than a decade ago to encourage Brits to save for college, retirement or a rainy day. The earnings made on ISAs, whether through interest or the sale of shares, completely avoid tax. In fact, these funds do not even need to be reported on your income tax return each year... you filthy tax avoiding scum

[Tom74]

Stupid graph. Particularly since the IoM now has information sharing with the UK and the banks have been giving details of UK offshore account holders to HMRC for some time. If a 'tax gap' still exists its only because they are too inefficient to bother to collect whats owed to them.

If you plan your finances in accordance with the law, how the hell is that avoiding tax? Surely its 'paying what you owe', rather than 'paying more than you should because you haven't read the rules correctly and thats what we wanted you to do and now we are complaining about your diligence'.

[Zod]

It is utter bks. Conflatin tax illegally or incompetently not paid/recovered with tax not payABLE under the taxes acts is typical of Labour Party thinking - all money is the state's and any retained after tax is pocket money grudgingly allowed.

[ewenm]

Fume troll said:

I suppose in this context avoidance means exploiting options which HMRC tried to avoid creating, and would prefer closed.

Or more clearly: "Tax avoidance is a course of action designed to conflict with or defeat the evident intention of Parliament".

Cheers,

FT.

If the intention is so "evident" then make the rules solid. After all, if it's evident, it should be easy to word the tax rules to leave no room for mis-interpretation or avoidance. The problem is the rules are so complicated that the correct amount of tax owed becomes a matter of opinion, not fact. Simplify the rules, reduce the admin costs and you'll have far less avoidance.

[Fume troll]

I suppose any time you try to describe all possible scenarios, the language can be interpreted differently. I know from working with contracts that one man's "shall" is another man's "should".

Yes, making it simpler would be better, but a lot of the detail and complexity is there to try and level the playing field for some entities, or to try and encourage or discourage certain activities. That's where the loopholes start to creep in.

There are other instances where we probably take the other line: the police and public take one view of what's illegal, the courts disagree, and we all get up in arms about some scrote's lawyer exploiting a legal loop hole. Prison avoidance vs evasion?

Cheers,

FT.

[Bluebarge]

Fume troll said:

I suppose in this context avoidance means exploiting options which HMRC tried to avoid creating, and would prefer closed.

Or more clearly: "Tax avoidance is a course of action designed to conflict with or defeat the evident intention of Parliament".

Cheers,

FT.

If Parliament's "evident intention" was that clear, they would pass a general anti-avoidance rule, as they have in Australia. They haven't, so this type of tax planning is prefectly fine.

[Fume troll]

Bluebarge said:

Fume troll said:

I suppose in this context avoidance means exploiting options which HMRC tried to avoid creating, and would prefer closed.

Or more clearly: "Tax avoidance is a course of action designed to conflict with or defeat the evident intention of Parliament".

Cheers,

FT.

If Parliament's "evident intention" was that clear, they would pass a general anti-avoidance rule, as they have in Australia. They haven't, so this type of tax planning is prefectly fine.

Is this back on the shelf then? http://www.telegraph.co.uk/finance/financetopics/b...

http://customs.hmrc.gov.uk/channelsPortalWebApp/do...

To me, a general anti avoidance rule seems a little daft to be honest. It's a band-aid akin to saying "rule one is obey the rules". If the rules don't stand on their own, then telling people not to avoid them seems a bit pointless.

Cheers,

FT.

[robm3]

What's wrong with Income Shifting between couples?

Perfectly acceptable I would have thought yet it's admission into this chart seems to reflect it's an area for potential crackdown.

[bogwoppit]

robm3 said:

What's wrong with Income Shifting between couples?

Perfectly acceptable I would have thought yet it's admission into this chart seems to reflect it's an area for potential crackdown.

Why is income shifting between couples perfectly acceptable? The employed don't get to do it, and it's purely to avoid tax. If your wife really is working and earning at market rate, it's not income shifting it's just "paying her".

[Zod]

bogwoppit said:

robm3 said:

What's wrong with Income Shifting between couples?

Perfectly acceptable I would have thought yet it's admission into this chart seems to reflect it's an area for potential crackdown.

Why is income shifting between couples perfectly acceptable? The employed don't get to do it, and it's purely to avoid tax. If your wife really is working and earning at market rate, it's not income shifting it's just "paying her".

It should be available for all, whether employed or self-employed. If the wife chooses to be at home with the kids, that is an unpaid job. The husband's income is the couple's income and both sets of allowances should be offset against it. People can witter about equality for unmarried couples or gay couples, but the same principle should apply to them if they have children and one gives up work to look after the children.