Aggressive Tax Schemes are the type you hear about in the news. They are the ones that high profile, high earners use to avoid paying tax on their incomes, for example Gary Linekar, Philip Schofield, Gary Barlow and David Beckham.
Or are they?
In fact it’s not just high profile, high earners that can fall foul of these schemes. In a recent article in The Times, it was outlined that there are tens of thousands of freelance workers who are facing demands of up to £900,000 in tax that wasn’t paid during the 2000s.
These freelancers were contractors who are claiming that they were led to believe that the schemes were operating inside the law, while HMRC are of a very different opinion! HMRC are now looking to recover these unpaid amounts, and it’s estimated that as many as 40% of those who owe amounts will go bankrupt as they are unable to pay.
There is a real problem here, as the contractors were told that the scheme they were joining was legal. According to the letter of the law at the time, they may well have fitted into a legal loophole, but the problem with these loopholes is that they very quickly get closed, and for those caught in the noose, the repercussions are extremely painful.
We don’t offer these Aggressive Tax Schemes for exactly this reason!
We know the tax regulations well. We know how HMRC operate, and have many years’ experience in helping clients pay as little tax as is legally possible. It is part of our role to ensure that this is the case, but we operate within the legislation rather than pushing it’s boundaries, as we believe that if something looks too good to be true, there’s a good reason!
Our clients can sleep well at night, knowing that if they’ve paid all that we advise, they won’t get any nasty shocks. They can pick up and open the brown envelopes from HMRC without worrying about what they may contain. We don’t believe this is the case where you become part of any of these Aggressive Tax Schemes!
If our clients want to find out more about any of these options, we of course have contacts to whom we can refer them, but do so with a note of caution.
To find out more about minimising your tax bills while staying within the tax regulations, please get in touch; we’d love to see how we can keep your liabilities low.
You might also like to have a look at our list of 16 tax-saving tips for small businesses, available here.