I hear so much these days about weird and wonderful tax schemes, are they right for me?
Date of Issue: 24 April 2007
Business
in Practice
A regular column of general business advice brought to you
by
Bates Weston, chartered accountants & business advisors.
Graham Buckell is the Tax Advisory Director
at Bates Weston, and with over 25 years experience in corporate
and personal tax, he advises on all aspects of direct tax. |
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Question:
I hear so much these days about weird and wonderful tax
schemes, are they right for me?
Answer:
Today the market place is full of many different tax planning
schemes, and your business and tax advisor should keep you up
to date with these. By their very nature, the schemes are designed
to avoid tax in ways not necessarily intended and as such are
not viewed favourably by the government or H M Revenue and Customs.
As fast as the providers of such schemes are looking to exploit
any potential tax loopholes, HMRC is looking to close them –
so there are no guarantees in this area. Schemes can cover a
variety of tax areas and include:
Remuneration Strategies
These schemes seek to provide a tax efficient strategy for withdrawing
remuneration from companies, usually whilst gaining a corporation
tax deduction.
Schemes to reduce Income Tax liabilities are also available.
Property Strategies
Strategies to mitigate Capital Gains Tax for individuals are
quite commonplace.
There are also a number of strategies to mitigate Stamp Duty
Land Tax both for developers and residential buyers.
Incentive Schemes
A number of schemes seek to utilise tax advantages offered by
the government in specific areas, e.g. enhanced allowances for
research and development expenditure.
Inheritance Tax planning
These schemes seek to mitigate exposure to inheritance tax and
may be particularly relevant to those of advanced years or in
poor health where surviving 7 years after a gift may be doubtful.
With any scheme it is important not to accept it at face value
as some of those promoted are highly vulnerable to successful
challenge by HMRC. It is also important to consider the level
of support that will be provided by the promoter.
These schemes are complex by nature, and have differing minimum
entry levels and associated costs and you will need to talk
to your tax advisor to determine which, if any, of these schemes
is appropriate for you, or your business.
If you would like to discuss these schemes please contact:
Graham Buckell, Tax Advisory Director
Email: grahamb@batesweston.co.uk
or telephone 01332 365855
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