It’s been hard not to notice the number of celebrities who’ve had their names dragged through the press and through the mud after taking part in aggressive tax planning schemes.
This seems to be a deliberate ploy by HMRC to give their current stance on tax avoidance greater exposure in the press, to put off other taxpayers who are considering using tax avoidance schemes.
Regardless of the success or failure or legality of any scheme, the plan seems to be to make tax avoidance planning socially unacceptable, a bit like smoking.
Controversial new legislation in the latest Finance Bill will require “followers” of schemes that have been successfully challenged by HMRC to amend their tax returns in the light of the court’s ruling, even though that decision may be subsequently overturned on appeal.
Taxpayers will be issued with a “follower notice” instructing them to amend their tax return in line with the court ruling, and will be faced with a penalty if they ignore the notice. Furthermore, the tax in question will need to paid in full pending the outcome of any appeal.
All of this highlights the need to consider in full the risks of any tax planning before it’s entered into. There are, of course, a number of tax planning opportunities are not affected at all by any of the new legislation, and are risk-free because they simply take advantage of existing tax rules.
It’s natural to want to keep as much of your earned profit in your own pockets as possible. If you want to talk over any aspect of tax planning, please get in touch by calling us on 01634 540040 or email Andy Hyland at email@example.com.