Its OK to let Vodaphone off £500 million in Tax

[Engineer1964]

......... But its morally wrong to pay a cleaner in cash

I've never heard so much catflap, If its wrong to pay someone in cash then do away with cash

I can't for the life of me see how the tax office could get it so wrong and really badly as well, Theres all the talk about TV presenters having a Limited company and paying little tax, well thats what i'm doing and a few million other small limited company owners. Its not wrong, its not illegal and if the government say its morally wrong then they should change the Law But they won't because its not illegal, You can't try and embarrass someone into paying more tax when legally they do not have to.

The cock up comes when the tax office lets off mega large companies like Vodaphone £500 million Tax bill and then try and embarass the rest of us into paying when we don't need to.

The Law states that anyone over 18 is allowed to earn just over £8,000 a year before paying any tax, i'm sure mrs mop who does a couple of hours work a week isn't worried about donating some of her earnings just because the goverment says its wrong to be paid in cash.

These idiots that come up with these crackpot ideas are probably earning in excess of £50,000 a year How come they are still in the job??

 

[octo0072000]

illegal to pay a plumber in cash

as for the illegal to pay a plumber in cash not sure on that one most trades round here want cash
you get a bill too many bounced cheques
small builders want materials cost up front on a monthly basis
as they are only allowed 30 days by the merchants

most steel fabrication used to work on free issue
don't know if that's still done or not now ??

 

[rtbcomp]

They're not saying it's morally wrong to pay in cash - they're saying it's wrong to knock the VAT off for cash.

Even so, if the trader still accounts for VAT on the reduced price it's OK - you're not saying the Machine Mart VAT-free days are wrong?

If the trader doesn't put the money through his books then that's illegal.

 

[Premiershipman]

I think the issue for most people again is that the Govt concentrate on the 'little guy' whilst letting big corporates get away with millions in owed tax as well as allowing big celebrities and senior civil servants to use dodgy tax schemes.

I think they need to get their priorities sorted to be honest.

Shady

 

[Dev]

It wasn't £500 million, it was £4.75 BILLION. According to some anyway.

I found this graph from the BBC interesting.

Source
The top 1% contributes almost a quarter of all income tax paid. And thats even after all their shenanigans. That 1% is people earning over £153,000.

The other 90% of us, earning up to £48,600 contribute less than half of all the income tax collected. I know there's more to cost of living than just income tax but its food for thought.

 

[Engineer1964]

They're not saying it's morally wrong to pay in cash - they're saying it's wrong to knock the VAT off for cash.

Even so, if the trader still accounts for VAT on the reduced price it's OK - you're not saying the Machine Mart VAT-free days are wrong?

If the trader doesn't put the money through his books then that's illegal.

But a cleaner who works part time, isn't going to be vat registered.

Paying cleaners and tradesmen cash-in-hand is ‘morally wrong’, a minister said yesterday.

David Gauke claimed that making small cash payments was as bad as tax avoidance, which ministers have already called ‘morally repugnant’.

Read more: http://www.dailymail.co.uk/news/art...cash-hand-bad-tax-avoiders.html#ixzz21Xrvv4c7

When a company like Machine Mart say VAT free, it just means that they knock off the 20% of the price, which matches the vat amount.

legally a company cannot decide when and who pays vat, They pay it themselves in full even though they advertise it as VAT Free

 

[Drains]

Suggesting the bottom end of the economy should be squeaky clean might be legally correct but I think we can say that any Conservative moral high ground has been chucked well and truly oot the windae!

Re the top 1% paying a quarter of the tax - well I'll bet they're earning a damn sight more than a quarter of the money, and I'll bet those earnings don't include all the tax free stuff - that won't be counted as earnings as it will go offshore or be held in companies and trusts.

 

[the snooper]

how they have the nerve is beyond me expences scandal was more then moraly wrong it was fraud

 

[Weldinator]

Well, they are very good at persuading old and new customers to go/stay with them, not!

It's their responsibility to pay the tax, not get away without paying it.

Never been with Voda and never will.

 

[Engineer1964]

Apparently Tax Avoidance is not illegal but Tax Evasion is, All these top earners and large companies are being told quite legally by their accountants ways to avoid paying tax, and perfectly legal too

However if Mrs Mop or Joe Bloggs tries to do the same they are morally wrong

There are loads of Tax avoidance schemes which have been going for years and have saved people Millions off their tax bills, If the goverment wants to stop it then they will see a large majority of UK businesses being registered aboard, Indeed thats whats happened when we sell off bits of british Companies like the engery companies, They pay very little tax as they are owned by foriegn companies.We've given too much away and not getting back enough tax from them

Its morally wrong to ask the man on the street as well as the small business to pick up the tab for years of bad policy making

 

[mike os]

bottom line is they think we will behave exactly like a politician when given pots of cash...*******

personally i do next to no cash jobs... ( i actually cant remember the last one.... must have been several years ago) that way there is never the opertunity for any problems... all the paperwork is there, even if its a "10 minute" job it either gets paperwork or no charge, depending on who, when & where

 

[Engineer1964]

bottom line is they think we will behave exactly like a politician when given pots of cash...*******

personally i do next to no cash jobs... ( i actually cant remember the last one.... must have been several years ago) that way there is never the opertunity for any problems... all the paperwork is there, even if its a "10 minute" job it either gets paperwork or no charge, depending on who, when & where

I Agree 100% mike, when i do a job i get offcuts left behind, if after about a year i havn't done nothing with them they usally go in the scrap bin around xmas time, However if i have some sheets left over and a guy comes in with £20 wanting to buy some its pointless me making an invoice and charging him plus vat, Reason being that the tax office might see that i get rid of say 10 tons of scrap a year they might say for me to try and sell it for ££S instead of letting it go for scrap.

People have been doing cash deals since the day the chinese invented money, Taxmen have been after it since then also

To say a cleaner is wrong to accept an hours work in cash compares to nothing the big companies get away with billions in Tax and the government sit back with their fingers up there backside, getting idiots like this guy who no one has heard of before to come up with someth so pathectic it makes the headlines.

Sad really

 

[piman]

Hello Engineer,

the government said it was morally wrong for the large companies (and not forgetting Jimmy Carr) as well so they are not singling out the tradesmen and their customers. Bear in mind that the 'Black economy' filters back into the economy and probably helps to boost trade generally.
What I think is far worse is the government squanders huge amounts of money with no real come back, except maybe being rejected at an election, for a time.

Alec

 

[Engineer1964]

Hello Engineer,

the government said it was morally wrong for the large companies (and not forgetting Jimmy Carr) as well so they are not singling out the tradesmen and their customers. Bear in mind that the 'Black economy' filters back into the economy and probably helps to boost trade generally.
What I think is far worse is the government squanders huge amounts of money with no real come back, except maybe being rejected at an election, for a time.

Alec

Hi Alec on the news it said Cleaners, Plumbers etc infact anyone that offers a discount for cash, They say that they are not paying VAT, But i can't see any cleaners earning more than £77,000 per annum or more than that in the next 30 days

What Jimmy Carr has done and probably everyone who anyone on tv is to use a tax avoidance scheme which is perfectly legal, and anyone who wants to keep the majority of their money will do it like this, The Taxman may not like it but no ones breaking the Law. Unless the government change the law, people will keep more of their money.

The goverment and MP's are so two faced when they say whats morally right or wrong, but just look at their own track record with the thieving and fraud they were involved in the expenses scandle, and letting the bankers get away with taking all the money out of the banks thus leaving the taxpayers to chip in

 

[mike os]

instead of spending all the time & money on crap like this they would be far better off closing the lopholes and making everyone.... including all businesses actually pay at least a basic rate tax...

if you want to be paid in lichtenstein... move there, & yes we do want your british passport back.

so you will move your company elsewhere... fine, you still owe us £££££ and dont forget the capital gains when you sell your property....

 

[Engineer1964]

instead of spending all the time & money on crap like this they would be far better off closing the lopholes and making everyone.... including all businesses actually pay at least a basic rate tax...

if you want to be paid in lichtenstein... move there, & yes we do want your british passport back.

so you will move your company elsewhere... fine, you still owe us £££££ and dont forget the capital gains when you sell your property....

The thing is Mike its not a loophole, everyones doing it and its perfectly legal,

I have a Limited company, I pay myself £8,105 Tax free, I then make Mrs Engineer a Director and pay her £8,105 Tax free also, I then Pay my self £34,000 dividends which is tax free so this year i can pay myself & Mrs Engineer £50,210 Tax Free, if i pay myself any more but no more than £150,000 then i only Pay 10% Tax

Then i only need to pay 20% corporation tax on any profit i show, and i try not to show any

So all this is perfectly legal and available to anyone on the HMRC website, I don't feel that i'm morally wrong as i work bloody hard for my money.

 

[ChrisJohnsSculpture]

It wasn't £500 million, it was £4.75 BILLION. According to some anyway.

I found this graph from the BBC interesting.

Source
The top 1% contributes almost a quarter of all income tax paid. And thats even after all their shenanigans. That 1% is people earning over £153,000.

The other 90% of us, earning up to £48,600 contribute less than half of all the income tax collected. I know there's more to cost of living than just income tax but its food for thought.

The problem with graphs like that is that is that it's easy to manipulate them by tweaking the boundaries of the groups. You don't even have to be deliberately trying to fiddle the figures, it's just plain difficult to sumarise that sort of information.

If the top one percent is anyone with an income of over £153, 000 then that covers a lot of ground. Someone earning 150K is clearly pretty well off but hardly super rich. It would be interesting to see how much the top 0.1% contribute as a percentage of their income.

The graph might also be more useful if the graph on the left was total income rather than number of people.

For example if someone earning £20,000 per year pays 10% of that in tax then that's a 'contribution' of £2000

If someone earning £2,000,000 pays just 1% tax then that's £20,000, ten times as much so they could argue that they were 'contributing' more although I doubt if many people would really consider that a fair tax system.

The graph also raises the question of whether 'income' is actual gross income or declared income. After all the whole point of tax avoidance schemes is to reduce the apparent income that you have to declare. The Jimmy Carr one involved 'investing' money in a company which then 'lends' it back to you.

 

[mike os]

The thing is Mike its not a loophole, everyones doing it and its perfectly legal,

I have a Limited company, I pay myself £8,105 Tax free, I then make Mrs Engineer a Director and pay her £8,105 Tax free also, I then Pay my self £34,000 dividends which is tax free so this year i can pay myself & Mrs Engineer £50,210 Tax Free, if i pay myself any more but no more than £150,000 then i only Pay 10% Tax

Then i only need to pay 20% corporation tax on any profit i show, and i try not to show any

So all this is perfectly legal and available to anyone on the HMRC website, I don't feel that I'm morally wrong as i work bloody hard for my money.

yes but you still pay corporation tax on the dividend and any other profit... until a few months ago i did exactly the same... all you really save is the NIC's.. still considerable but fine.

the issue is with companies like voda that make hundreds of millions++ profit & only pay 2% or whatever... because "they came to an arrangement" with hmrc......

that said, i think dividends for working directors needs looking into as taxable income, especially when it is written into a contract... the same with golden handshakes and severance settlements beyond statutory requierments if the company "has to pay" then it should be regarded as paye and taxed as such


Uk citizens working in the uk should be taxed in the uk irregardles of who they work for or where "they are based"... unless they travel to the uk to work for a limited period... not live in hatfield for 11/12 & paid tax free in thailand.... then if they are entitled to a tax exempt status they reclaim from hmrc

 

[Engineer1964]

Thats one angle at looking at this, i suppose theres so many different ways that you could view the whole issue that someone looking at it from a different angle might interpret it differently.

The guy that works in a factory all his life paying 20% tax might be a bit angry with those people that have Limited Companies and can get their tax down to practiacally zero.

But the thing is that guy in the factory has just as much right to start up on his own and have his own limited company.

People Chose the route they want to live, you can't simply get angry with people because they have a method for paying less tax.

Jimmy Carr earnt his money he took advice as how to best use it without paying over the top tax, lets face it thats what we pay accountants for, But had he broken any laws, he would of been arrested yonks ago, All he did was Tax Avoidance, which is perfectly legal, unlike Lester Picott, who spent some jail time for Tax Evasion a more serious crime

 

[Dev]

The problem with graphs like that is that is that it's easy to manipulate them by tweaking the boundaries of the groups. You don't even have to be deliberately trying to fiddle the figures, it's just plain difficult to sumarise that sort of information.

If the top one percent is anyone with an income of over £153, 000 then that covers a lot of ground. Someone earning 150K is clearly pretty well off but hardly super rich. It would be interesting to see how much the top 0.1% contribute as a percentage of their income.

The graph might also be more useful if the graph on the left was total income rather than number of people.

For example if someone earning £20,000 per year pays 10% of that in tax then that's a 'contribution' of £2000

If someone earning £2,000,000 pays just 1% tax then that's £20,000, ten times as much so they could argue that they were 'contributing' more although I doubt if many people would really consider that a fair tax system.

The graph also raises the question of whether 'income' is actual gross income or declared income. After all the whole point of tax avoidance schemes is to reduce the apparent income that you have to declare. The Jimmy Carr one involved 'investing' money in a company which then 'lends' it back to you.

It must be declared income since it comes from the HMRCs own figures for how much they collected. Which, if true, means that even after all their 'avoiding' the richest still pay the lions share.

The tabulated data the graph was compiled from is linked from the original article.