Quite simply Tax Evasion is illegal and Tax Avoidance according to the Country’s leaders is immoral. But is it and where should the line be drawn?
In out little battery business (County Battery Services Ltd) in Notts and Derbys (UK) expenses come along for example we supply our hard working and diligent staff with tea and coffee Now this is classed as an expense and is paid for from the profit the company generate. If I decide that should one of my staff be off work sick that would cause too many problems and I want to pay for them to have personal health cover I can and this too is classed as an expense and is paid for from the company profits. Slight difference here the government deem this as a “benefit in kind” so my staff member has to pay extra income tax on it. All very confusing seems like they are both benefits to me
To the point Tax Evasion is where you use cunning and guile to outwit the revenue and don’t pay them the Tax due, this may be not declaring earnings etc. Tax avoidance is where you use the law to get away without paying tax, I am told that there are ways that you can set up pension schemes that all moneys paid in are tax free then borrow the money back from the pension scheme never actually repaying the money borrowed. Or as Google did set up a head office in Eire where the corporation tax is 10% instead of 20% in the UK
Who does want to pay tax and given the choice who would elect to pay 20% instead of 10% after all an extra 10% per year invested in my company would aid growth and I am sure help to employ more staff. Here is where my dilemma comes I do not want to pay tax! But I recognise taxes need to be paid I believe the reason that it is possible to to avoid tax in the Governments “immoral way” is because all the taxes are too complicated, My message to the government is KISS (Keep It Simple Stupid!) It might mean that little fat battery men are able to grow their business more effectively