HMRC crackdown on tax avoidance
HMRC is cracking down on people who try to avoid paying tax. It is spreading its net wide. From plumbers, to restaurant owners, to private tutors, to offshore investors, few appear safe as HMRC bids to narrow the 'tax gap' – the difference between tax collected and the tax they believe ought to be collected.
Furthermore, HMRC's latest efforts are not just about illegal tax evasion. This time it is investigating tax avoidance. HMRC is proposing to name and shame tax avoidance schemes that are unlikely to deliver the tax savings claimed. Anyone found to be using the schemes might have to pay the tax avoided upfront, plus an extra charge on that tax.
So, should individuals be worried?
Most people will have little to be concerned about, but now, more than ever it may be appropriate to err on the side of caution on all tax-saving matters.
Take advantage of this fantastic offer to sell your property for a fee of just 1% + VAT until February 2014.
Terms: Minimum fee £1250 + VAT. Based on a sole agency agreement.
Contact: 01242 460702
Valid until: Friday, January 31 2014
There are a number of tell-tale signs to spot tax avoidance schemes. For example, if a scheme sounds too good to be true, it probably is, and if a confidentiality and secrecy agreement needs signing, you can be pretty sure that there is intellectual property which is designed to kept from HMRC. Likewise, if you are required to take out an insurance policy or there is a contingency fund, against the tax benefits of the scheme failing to materialise then give it a wide berth.
There are still many ways that people can legitimately reduce their tax bills. From making the most of family and spouses to maximise allowances, to using offshore bonds to defer tax, to sacrificing part of your salary to bring your tax threshold down. Trusts and tax-efficient investments can also be used and won't be frowned upon by HMRC, so it is worthwhile exploring your options carefully with a specialist adviser.
With HMRC cracking down and the boundaries between what is legitimate and what is not becoming blurred, it is vitally important for people to seek expert help. Indeed, Nick Clegg, the Deputy Prime Minister, admits that consumers are "perfectly entitled" to employ an expert tax adviser. It is an entitlement that people should grab with both hands.
To receive a complimentary guide covering Wealth Management, Retirement Planning or Inheritance Tax Planning contact Charlotte Poole-Graham on 07415855071, by email email@example.com or visit www.charlottepoolegraham.co.uk.