Business
By Chris Davies, of Ross Brooke Accountants
I read in a recent survey that across accountancy firms 78 per cent of clients wanted their accountant to speak to them about alternative ways to mitigate tax liabilities but only 33 per cent had actually done so.People’s views of taxes differ remarkably, although I have yet to find anyone who actually enjoys paying it. Some regard it as morally right to pay a share towards the state for health services, national defence and emergency services etc whilst others absolutely abhor the thought of paying money to the tax authorities.
A business owner might well regard tax as simply another cost of doing business and if that is the case then it will come of no surprise when he seeks to reduce that cost.
Much has been said in the press recently about the possible introduction of General Anti-Avoidance Regulations to reduce some of the perceived tax loss to the Exchequer but how much affect will this have on the majority of taxpayers? Probably very little.
Tax avoidance is a taxpayer’s decision to arrange his tax affairs within the law so as to pay as little tax as possible. This is his fundamental legal right. This might involve something as simple as incorporating a business or transferring shares around a family etc. Tax evasion, however, involves arrangements that fall outside of the law, eg suppressing takings, under declaring income etc, and can land the taxpayer in serious trouble, and in some cases even a custodial sentence. Somewhere in the middle ground falls some of the more aggressive tax planning schemes that seek to circumvent the application of the law. Probably in a legal way but some may question the morality of these schemes.
From an accountant’s point of view, any reputable firm will always act in the best interests of their client and make sure that any advice that they give is within the spirit of the law. But that’s not to say that all accountants will offer the same advice or range of services. While some will be happy to offer very straightforward and simple advice, others will be more aware of and more willing to discuss advanced options.
Personally, I believe that it is important that clients are aware of the options available to them so that they can make informed choices. I always seek to discuss the options available with my clients, and while not everyone will choose to implement the full range of options, they are at least given the chance to make a fully informed decision. If anyone would like to talk to me about the options available to their business then I would be delighted to hear from them on cdavies@ross-brooke.co.uk or (01635) 555666.
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