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Money to invest...

Discussion in 'Personal' started by Marshall, Dec 7, 2019.

  1. lizziescat

    lizziescat Star commenter

    I don’t call it anything.
    I have quoted HMRC definition, of ‘tax avoidance’ which is the salient point here.

    (We should not confuse a common, everyday use of vocabulary - ie ‘avoidance’ - with the technical definition.)

    HMRC give the technical tax-related definition

    The challenges and queries come from understanding what parliament and thus HMRC mean by ‘intended’ and ‘bending the rules’ - hence cases where such things are challenged an ruled upon.
  2. LondonCanary

    LondonCanary Star commenter

    It isn't . Frequently people can organize their affairs in certain ways that reduce their tax bill. This is tax avoidance which is perfectly legal. e.g. Taking some earnings as dividends rather salary to reduce tax and NI.
  3. MissGeorgi

    MissGeorgi Occasional commenter

    Ok. So I favour low risk stuff, because a) I’ve seen people lose £100k + and b) I like to forget about it whilst it earns me cash. Not much, but it all adds up!

    i max out my tax free ISA allowance. Shop around for the best rates.
    Then also premium bonds.
    I think that also property is a good investment. I’d wait until after Brexit (if that’s possible)!! as the value of the pound may change.
  4. lizziescat

    lizziescat Star commenter

    I repeat , .i have quoted HMRC definition - which is relevant in terms of taxation and, I presume, is the basis of their ‘going after’ certain celebrities etc.

    If you claim your personal allowance, and thus ‘avoided’ (using the common non-technical use of vocabulary)- that is what the govt ( HMRC) intended you to do ie Not Tax Avoidance (in the technical/legal sense.)

    If you take out an ISA you ‘avoid’ (using a common usage of the term ) paying tax but you are doing what the govt/HMRC want you to do and therefore are not committing tax avoidance as defined by govt/ HMRC and the legal sense.

    If you bend the rules and use the law for a purpose for which it was not intended - that is tax avoidance as defined by HMRC and will thus be challenged and pursued on this basis
  5. lizziescat

    lizziescat Star commenter

    All I did was point out the tax/ legal/hmrc situation of tax avoidance.
    Sheeesh - I shan’t bother in future.
  6. magic surf bus

    magic surf bus Star commenter

    When I was teaching IT I forked out a fair sum for personal computers over the thirty years I worked in school. My BBC Master 128 computer kit cost around £1000 in 1988 when I bought it. I reckon I used my home PCs at least half the time for school-related work, but was I ever able to claim any of it as an expense? Not as a PAYE employee. Did I make substantial use of one room in the house for school-related work after school hours? Of course. Was I ever able to claim the use of an 'office' as an expense? Not as a PAYE employee.

    The only thing I could claim against tax as a teacher was my Union subscription. Teachers of other specialist subjects could claim for related clothing, but as an IT teacher I could never claim for equipment. I wasn't issued a personal computer by my school until the final years of my career.

    Ironically, for ten years I ran a sideline to teaching which (unlike many) I declared for tax purposes. Could I claim the computer as an expense? Of course. I claimed a proportion of it as a capital allowance. Could I claim a proportion of the household bills as an expense to offset the use of a room for business purposes against income tax? Of course.

    Different rules for different sectors. The things I can claim for now as a self-employed private sector person take my breath away compared to the work-related expenses I ran up as the employee of the public sector, and couldn't claim for.

    That's a whole area of the tax 'avoidance' debate that needs properly addressing.
  7. LondonCanary

    LondonCanary Star commenter

    There is a fundamental difference when as a self-employed person you are have to supply all equipment and materials to do your job compared to employees who normally have it all supplied and are paid expenses.
  8. magic surf bus

    magic surf bus Star commenter

    Likewise, the non-teaching p/t job I had with the local council, where the site had no internet connection and no computer equipment, but was line managed by e-mail. Could I claim for any of the non-working hours I spent juggling e-mails or managing the finances with a spreadsheet? Of course not. I suspect normally is less normal than you might believe.
  9. LondonCanary

    LondonCanary Star commenter

    My normally referred to equipment and expenses rather than salary v project

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