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Sajid Javid tax avoider?

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    Sajid Javid tax avoider?

    The Chancellor, the avoidance and the hypocrisy.pdf - Google Drive

    DB Group Services (UK) Ltd V HMRC
    (DB = Deutsche Bank, which at the time of the scheme use employed Mr Sajid Javid, the current
    Chancellor of the Exchequer)
    The Supreme Court found in favour of HMRC in that the scheme was set up purely for the benefit of
    avoiding Tax.
    The scheme was devised to work as follows:
    ITEPA2003, pt7, Ch2 provides a tax exception (s425(2)) with respect to ‘restricted securities’
    awarded to employees.
    Restricted securities are explained at s423(2) which broadly states that they are shares which are
    subject to provision for forfeiture if a contingency occurs. Instead of paying bonuses (which of
    course would have been taxable) directly to its employees DB purchased redeemable shares in
    offshore companies set up purely for this exemption.
    To meet the legislation (the required contingency) DB stated that the shares would need to be
    forfeited if the employee was either dismissed for gross misconduct or voluntarily resigned....within
    the next 6 weeks. Clearly these are contingencies highly unlikely to occur – and indeed within the
    power of the employee.
    Once these, purposely meant to be unlikely, actions had not occurred the shares were redeemable
    for cash.
    The Supreme Court found that there are a number of purposes for the legislation such as the
    promotion of employee share ownership but stated that it was unlikely Parliament had intended it
    to be used to avoid tax payments. Therefore, is was decided that the bonuses should have been
    taxed as shares on the date of their acquisition.

    In this Video the chancellor states he has never benefited from this scheme. Well that’s probably
    because nobody did eventually as explained above, given that HMRC won the argument.

    The chancellor seems less forthcoming on the question of whether he entered the scheme...or to be
    precise, what should be asked is “Dear Mr Chancellor, have you EVER owned any restricted
    securities in an offshore company?” If so, please do list them.

    Now if the answer to that question evidences that the Chancellor has indeed participated in a,
    proven to fail, tax avoidance scheme then does that make his position untenable?

    Considering his predecessor, Mr Hammond and also the current Chair of the Treasury Select
    Committee (TSC) Mel Stride have previously stated that people affected by the Loan Charge
    (schemes primarily much less convoluted and indeed not proven to fail by any court to date) have
    committed an illegal act by use of such schemes, surely the answer must be a re-sounding ‘Yes’!

    Indeed just last month Mr Javid wrote to a person affected by the Loan Charge and stated “The Loan
    Charge was designed to tackle contrived tax avoidance schemes”....”The Government is clear that
    such schemes do not work”
    So, Mr Javid seems to be telling us that the Government are clear schemes which have NOT been to
    court do not work (and they are therefore happy to retrospectively attack normal, low-earning
    members of society causing untold damage to lives and forcing people to suicide as shown here). In
    stark contrast to this, the Government are also quite content to having a Chancellor - who has
    evidentially utilized a scheme that has been PROVEN not to work by the Supreme Court - running the
    entire Finances of the UK.

    Just this morning I have woken to find another handful of clients and people affected by the Loan
    Charge, have sent me desperately sad texts about how their lives have been ruined:
    Ruined by a retrospective tax despite them never having been found guilty of anything or indeed
    being given a right to stand in a court.
    Lives have already been and continue to be destroyed despite these people having not done
    anything wrong in the eyes of any court, nor have HMRC been able to prove that this retrospective
    tax was or indeed is due.
    Mr Javid on the other hand, if he did own those shares, is different because his scheme has proven
    to fail by HMRC and even the Supreme Court. Of course Mr Javid is, in his role and with his working
    background, part of the establishment, a part of the entitled few that can ruin the lives for the very
    many.
    Power Corrupts, Absolute power corrupts absolutely.

    Phil Manley

    *If anyone wishes to look up the above named legislation it is, as mentioned, in pt7 ITEPA2003.
    Which is where you will also find the loan charge legislation as it happens

    ================================================== ===
    Whatever you think of him (and i suggest you keep to yourself as he will sue you for any libel) the man has some real conviction and its way better than mps writing pointless letters.
    Last edited by BrilloPad; 9 November 2019, 18:13.

    #2
    who here isn't a tax avoider?
    See You Next Tuesday

    Comment


      #3
      Originally posted by Lance View Post
      who here isn't a tax avoider?
      Me. I run a business to the law. So not a tax avoider.

      You might be by the sound of it

      Comment


        #4
        Nothing illegal about avoidance. Evasion on the other hand...

        Comment


          #5
          Originally posted by Amanensia View Post
          Nothing illegal about avoidance. Evasion on the other hand...
          I don't think HMRC understand the difference.

          BTW, if true, the saj would be guilty of aggressive tax avoidance. Which is still legal. Not sure the voters would understand that.

          Comment


            #6
            Originally posted by cosmic View Post
            Me. I run a business to the law. So not a tax avoider.

            You might be by the sound of it
            Do you pay more tax than you absolutely need to?
            For example even if outside IR35, do pay yourself salary rather than dividends?
            No?
            Thought not.

            You're a tax avoider.

            It's a scale like this
            1) PAYE so have no choice or method in how to handle their affairs.
            2) Tax avoider. Have some choice around when and how they handle their affairs such that a reduced tax burden is achieved. Divis rather than salary, retaining profit in the company to avoid higher rate personal tax, etc.
            3) Tax avoider using artificial schemes later found out later to be DAF. Loan charges, films, other overly complex ideas that could faull under GAAR.
            4) Tax evader. Choose not pay what is legitimately owed (some would say #3 is in this bracket)
            5) Fraudsters. Lie and cheat to hide what should be owed.
            See You Next Tuesday

            Comment


              #7
              Originally posted by Lance View Post
              Do you pay more tax than you absolutely need to?
              For example even if outside IR35, do pay yourself salary rather than dividends?
              No?
              Thought not.

              You're a tax avoider.

              It's a scale like this
              1) PAYE so have no choice or method in how to handle their affairs.
              2) Tax avoider. Have some choice around when and how they handle their affairs such that a reduced tax burden is achieved. Divis rather than salary, retaining profit in the company to avoid higher rate personal tax, etc.
              3) Tax avoider using artificial schemes later found out later to be DAF. Loan charges, films, other overly complex ideas that could faull under GAAR.
              4) Tax evader. Choose not pay what is legitimately owed (some would say #3 is in this bracket)
              5) Fraudsters. Lie and cheat to hide what should be owed.
              No. 2 is a misrepresentation of the term 'tax avoidance'. People have the choice to save via an ISA or via a standard savings account. Choosing an ISA in not tax avoidance. People who say it is are often trying to muddy the waters.

              Comment


                #8
                Originally posted by Old Greg View Post
                No. 2 is a misrepresentation of the term 'tax avoidance'. People have the choice to save via an ISA or via a standard savings account. Choosing an ISA in not tax avoidance. People who say it is are often trying to muddy the waters.

                general definition

                What Is Tax Avoidance?

                Tax avoidance is the use of legal methods to modify an individual's financial situation to lower the amount of income tax owed. This is generally accomplished by claiming the permissible deductions and credits. This practice differs from tax evasion which uses illegal methods, such as underreporting income, to avoid paying taxes.
                HMRC defionition


                Tax avoidance involves bending the rules of the tax system to gain a tax advantage that Parliament never intended.
                It often involves contrived, artificial transactions that serve little or no purpose other than to produce this advantage. It involves operating within the letter, but not the spirit, of the law.
                so it depends on the definition you choose.

                I am perfectly happy avoiding tax by having an ISA.

                Wait till Jezzy gets in!
                Always forgive your enemies; nothing annoys them so much.

                Comment


                  #9
                  Originally posted by vetran View Post
                  general definition



                  HMRC defionition




                  so it depends on the definition you choose.

                  I am perfectly happy avoiding tax by having an ISA.

                  Wait till Jezzy gets in!
                  An ISA is no more tax avoidance than buying jaffa cakes instead of chocolate digestives.

                  Where did your 'general definition' come from?

                  Comment


                    #10
                    Originally posted by Lance View Post
                    Do you pay more tax than you absolutely need to?
                    For example even if outside IR35, do pay yourself salary rather than dividends?
                    No?
                    Thought not.

                    You're a tax avoider.

                    It's a scale like this
                    1) PAYE so have no choice or method in how to handle their affairs.
                    2) Tax avoider. Have some choice around when and how they handle their affairs such that a reduced tax burden is achieved. Divis rather than salary, retaining profit in the company to avoid higher rate personal tax, etc.
                    3) Tax avoider using artificial schemes later found out later to be DAF. Loan charges, films, other overly complex ideas that could faull under GAAR.
                    4) Tax evader. Choose not pay what is legitimately owed (some would say #3 is in this bracket)
                    5) Fraudsters. Lie and cheat to hide what should be owed.
                    All no appart from #2.

                    But still not a tax avoider. I think the wording is incorrect and it depends on how you operate. I run a business. Paying salary, Yes I do. Paying divs yes I do but it's form the betterment of the company and not me. As a director my obligation is to see the company succeed. No doing anything illegal or immoral like paying lower tax than uk whilst operating in uk.

                    HMRC can label what they want. They are not the law and the law is what I'm following not HMRC. Most if not all business operate as I do appart from complex multinational companies that are real tax avoiders.

                    Comment

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