In these austere times, with headlines abounding in the media that big business doesn’t pay its fair share of tax, can tax planning ever be, or perceived to be, a good thing? Our sister company, Gateley Capitus, thinks it can and Director, Aubrey Calderwood, is here to explain how.
The Bad
Clearly there is much bad tax planning and the practice of “avoiding” tax, whilst not technically illegal, has become synonymous with something that is seedy, dirty and not something that a morally upstanding company should be engaged in. The “Double Irish”, the “Dutch sandwich” and myriad other convoluted and aggressive tax avoidance schemes are endlessly doing the rounds but most of them would not pass anyone’s “sniff” test.
The Good
So, if that is bad tax planning, can there ever be such a thing as good tax planning? Well, the UK Treasury certainly seems to think so. They don’t shout about it or explain it particularly well but contained deep within the UK tax code, a range of tax-based fiscal incentives exist that the Government actually wants businesses and individuals to claim.
Why? Because by making these incentives available to businesses in a very targeted way, they are hoping that companies will be more inclined to act or behave in a certain manner. And if they don’t behave in that manner, they will be taxed instead. The ultimate carrot and stick!
