Understanding the differences between tax avoidance and tax evasion, is an essential piece of knowledge for all taxpayers, whether you are an individual or whether you are a business.
Tax avoidance and evasion is typical and headline news. Jimmy Carr, Gary Barlow, Ken Dodd, Amazon, being high profile individual examples of avoidance or evasion
The lines between tax avoidance (perfectly legal) and tax evasion (not legal) seem to have become blurred. Denis Healy, former Chancellor of the Exchequer famously described the difference between the two as “…the thickness of a prison wall.
In this short video I am going to
- Firstly, outline what tax avoidance and tax evasion is
- Secondly, share examples of the two
- Lastly, why one should be encouraged, and one avoided
In recent years tax avoidance has been the subject of considerable public concern, although there is no statutory definition of what tax avoidance consists of. Tax avoidance is to be distinguished from tax evasion, where someone acts against the law. By contrast tax avoidance is compliant with the law, though aggressive or abusive avoidance, as opposed to simple tax planning, will seek to comply with the letter of the law, but to subvert its purpose.
Conclusion
This vlog on tax avoidance and tax evasion is essential stuff to know. Moreover, knowing what’s what keeps you informed and on the right side of the law.
Furthermore, you can improve your financial understanding and well-being. Plus make more profit, save tax and time, and your money mindset. How wonderful is that?
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