{"id":15381,"date":"2012-05-03T09:34:16","date_gmt":"2012-05-03T08:34:16","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=15381"},"modified":"2012-05-03T09:34:16","modified_gmt":"2012-05-03T08:34:16","slug":"2000-cases-of-tax-avoidance-one-persistent-culture-of-tax-abuse","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2012\/05\/03\/2000-cases-of-tax-avoidance-one-persistent-culture-of-tax-abuse\/","title":{"rendered":"2,000 cases of tax avoidance &#8211; one persistent culture of tax abuse"},"content":{"rendered":"<p>The BBC has found that 2,000 civil\u00a0servants\u00a0are being paid through their own limited companies. That lets them split their income with others, reducing the income tax bill; pay dividends to avoid a national insurance bill and claim expenses an employee could not offset.<\/p>\n<p>When these people are employees that's obviously wrong. <a href=\"The aim of the legislation is to eliminate the avoidance of tax and National Insurance Contributions (NICs) through the use of intermediaries, such as Personal Service Companies or partnerships, in circumstances where an individual worker would otherwise -  For tax purposes, be regarded as an employee of the client; and For NICs purposes, be regarded as employed in employed earner\u2019s employment by the client. Prior to the introduction of the legislation, an individual could avoid being taxed as an employee on payments for services and paying Class 1 NIC by providing those services through an intermediary. The worker could take the money out of the intermediary, normally a Personal Service Company, in the form of dividends instead of salary. As dividends are not liable to NICs, the use of a dividend remuneration strategy results in the worker paying less in NICs than either a conventional employee or a self-employed person. And PAYE would not apply to the dividends.  The legislation ensures that, if the relationship between the worker and the client would have been one of employment had it not been for an intermediary the worker pays broadly tax and NICs on a basis which is fair in relation to what an employee of the client would pay.\" target=\"_blank\">HMRC are clear on the point.<\/a>\u00a0But top civil servants have turned a blind eye.<\/p>\n<p>That ignoring the requirements of law is worrying in\u00a0itself. It indicates a civil service\u00a0that\u00a0has been corrupted by greed and the ethos of personal gain.<\/p>\n<p>But it also very clearly suggests that there's a culture in place that thinks tax avoidance is acceptable. That's more important - because tax avoidance undermines democracy by denying to\u00a0governments\u00a0the funds reasonably due to them. When the civil service can't see that we're in trouble.<\/p>\n<p>2,000 tax\u00a0avoiders\u00a0is an issue. The cultural issue is a much more important one.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The BBC has found that 2,000 civil\u00a0servants\u00a0are being paid through their own limited companies. That lets them split their income with others, reducing the income<br \/><a class=\"moretag\" href=\"https:\/\/www.taxresearch.org.uk\/Blog\/2012\/05\/03\/2000-cases-of-tax-avoidance-one-persistent-culture-of-tax-abuse\/\"><em> Read the full article&#8230;<\/em><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10],"tags":[],"class_list":["post-15381","post","type-post","status-publish","format-standard","hentry","category-tax-avoidance"],"_links":{"self":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/15381","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/comments?post=15381"}],"version-history":[{"count":0,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/posts\/15381\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/media?parent=15381"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/categories?post=15381"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.taxresearch.org.uk\/Blog\/wp-json\/wp\/v2\/tags?post=15381"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}