Tax avoidance – immoral/unethical?
The Lord President Clyde, ruling on the test case Ayrshire Pullman Motor Services v Inland Revenue Commissioners in 1929:
"No man in this country is under the smallest obligation, moral or other, so to arrange his legal relations to his business or to his property as to enable the Inland Revenue to put the largest possible shovel into his stores. The Inland Revenue is not slow to take every advantage which is open to it under the taxing statutes for the purpose of depleting the taxpayer's pocket. And the tax payer is, in a like manner, entitled to be astute to prevent, so far as he honestly can, the depletion of his means by the Revenue"
Basically this just somes up what every good accountant should already know - a taxpayer is perfectly entitled to organise their affairs so that they pay less tax.
As long as it's legal, HMRC can't do a thing about it.
Saturday, 16 June 2012
Hobby or a business.....
Well.... some people have a "normal" job (whether part time or full time) and have a little play on various adult websites as a "hobby".
Sometimes what you class as a hobby may not be that in the eye's of the lovely people at HMRC.
If you have set up yourself up to provide services (whether camming, phone or in person) and you are in the eyes of HMRC running it like a business, then you have to declare that income and pay the appropriate amount of tax and NI on your profit.
Is there a strict definition of a hobby as far as HMRC is concerned - NO! but this is where common sense prevails.
I would respectively suggest (and HMRC tend to agree) that if you are charging people on a regular basis then it's a business. Therefore HMRC want their share - simples!
If you decide to argue the case with HMRC then consider all aspects - the paying in of your earnings, the feedback from your services. All of this will lean heavily towards running a business therefore you pay tax.
YES this is the case even if you are paying tax on your normal job.
Confused / need help - feel free to get in touch.
Remember that tax evasion is not something HMRC look favourably upon.
Sometimes what you class as a hobby may not be that in the eye's of the lovely people at HMRC.
If you have set up yourself up to provide services (whether camming, phone or in person) and you are in the eyes of HMRC running it like a business, then you have to declare that income and pay the appropriate amount of tax and NI on your profit.
Is there a strict definition of a hobby as far as HMRC is concerned - NO! but this is where common sense prevails.
I would respectively suggest (and HMRC tend to agree) that if you are charging people on a regular basis then it's a business. Therefore HMRC want their share - simples!
If you decide to argue the case with HMRC then consider all aspects - the paying in of your earnings, the feedback from your services. All of this will lean heavily towards running a business therefore you pay tax.
YES this is the case even if you are paying tax on your normal job.
Confused / need help - feel free to get in touch.
Remember that tax evasion is not something HMRC look favourably upon.
Letters from the taxman....
People are now starting to get letters from HMRC advising of the fact that they have to submit a self assessment tax return.
You have until 31st January 2013 to file and pay, but you can do it earlier if you want.
Sometimes you may need to if applying for a mortgage etc.
If you don't know what your tax liability is, then why wait until filing day to get a shock from the taxman. I can calculate your tax accurately very quickly if needed so you know how much you have to have ready.
Don't forget that if you are a day late filing, the nice people at HMRC send you an instant automatic £100 fine.
Remember - if you are self employed, you must file a tax return even if your taxable profits are less then the annual personal allowance.
If you need help....get in touch.
You have until 31st January 2013 to file and pay, but you can do it earlier if you want.
Sometimes you may need to if applying for a mortgage etc.
If you don't know what your tax liability is, then why wait until filing day to get a shock from the taxman. I can calculate your tax accurately very quickly if needed so you know how much you have to have ready.
Don't forget that if you are a day late filing, the nice people at HMRC send you an instant automatic £100 fine.
Remember - if you are self employed, you must file a tax return even if your taxable profits are less then the annual personal allowance.
If you need help....get in touch.
My charging policy....
Lets just set a few things straight out in the open for all to see:
I don’t charge people in this industry more than I would do a non adult industry client.
Most of my adult industry clients have simple tax affairs and will usually pay not a lot per month for an all inclusive service.
No hidden fees at all.
I have even been known to reduce my fees year on year.
If your affairs are simple, then the fee is less than a client who has more complex affairs, hence no pricing “menu”.
Payment in Kind – thanks but no thanks… whilst you think you may be the best thing sexually, payment in kind will not buy me food or petrol. The only exception to that is if you want to give me an Aston Martin (I live in hope and it has to be the right colour!)
I have absolutely no issues working with adult industry clients. As long as what you do is not illegal (animals/kids etc) then I don’t give a damn what you get up to. All I ask is that you treat me with the courtesy and professionalism that you get from me.
I appreciate that anybody can say the above – if before or after meeting me then you wish to talk to existing clients this can be arranged. No strings, no catches.
There are accountants out there who will think that adult industry workers can be fleeced… sorry but my personal and professional morals don’t allow me to do that.
I prefer to be honest and open and have you as a client for many years rather than make a quick buck in year 1. If you leave the industry then I am more than happy to still work with you to sort your finances out.
Do I just market myself in the adult industry? No I don’t, but I do realise that it is an industry where my services are called for; hence I promote myself as appropriate. I also promote myself heavily in the “normal” world.
I don’t charge people in this industry more than I would do a non adult industry client.
Most of my adult industry clients have simple tax affairs and will usually pay not a lot per month for an all inclusive service.
No hidden fees at all.
I have even been known to reduce my fees year on year.
If your affairs are simple, then the fee is less than a client who has more complex affairs, hence no pricing “menu”.
Payment in Kind – thanks but no thanks… whilst you think you may be the best thing sexually, payment in kind will not buy me food or petrol. The only exception to that is if you want to give me an Aston Martin (I live in hope and it has to be the right colour!)
I have absolutely no issues working with adult industry clients. As long as what you do is not illegal (animals/kids etc) then I don’t give a damn what you get up to. All I ask is that you treat me with the courtesy and professionalism that you get from me.
I appreciate that anybody can say the above – if before or after meeting me then you wish to talk to existing clients this can be arranged. No strings, no catches.
There are accountants out there who will think that adult industry workers can be fleeced… sorry but my personal and professional morals don’t allow me to do that.
I prefer to be honest and open and have you as a client for many years rather than make a quick buck in year 1. If you leave the industry then I am more than happy to still work with you to sort your finances out.
Do I just market myself in the adult industry? No I don’t, but I do realise that it is an industry where my services are called for; hence I promote myself as appropriate. I also promote myself heavily in the “normal” world.
The initial meeting...
I am more than happy to have an initial chat over the phone to offer non committal advice etc relating to your situation. Obviously you cannot rely or quote me on anything until you become a fee paying client – that is just how accountants and lawyers work - we are all the same.
I am more than happy to use your working name initially, BUT, once we meet and we decide that we can work together, then I need your normal name and address. I am obviously happy to prove to you whom I am once we meet. My status and ID can be verified real time online with my institute.
Why do I do this? Simple – I have to by law.
I am regulated by a UK Chartered Institute and apart from having to comply with their rules and regulations, I must also comply with the Money Laundering Regulations Act 2007. It’s dull and boring so don’t bother reading it – the main relevant bit is that I must see original photo ID and proof of address. I also have to issue a formal engagement letter which acts as a contract between ourselves.
If I don’t and my practice is subject to a routine paperwork audit, then I get in trouble – Simples.
Unfortunately no client is worth me loosing my business over, therefore if you are not willing to work this way then I suggest you find yourself a back street unregulated fool who calls themselves an accountant as all regulated accountants must do as I do.
Again, I have numerous clients who will vouch for my integrity.
I am more than happy to use your working name initially, BUT, once we meet and we decide that we can work together, then I need your normal name and address. I am obviously happy to prove to you whom I am once we meet. My status and ID can be verified real time online with my institute.
Why do I do this? Simple – I have to by law.
I am regulated by a UK Chartered Institute and apart from having to comply with their rules and regulations, I must also comply with the Money Laundering Regulations Act 2007. It’s dull and boring so don’t bother reading it – the main relevant bit is that I must see original photo ID and proof of address. I also have to issue a formal engagement letter which acts as a contract between ourselves.
If I don’t and my practice is subject to a routine paperwork audit, then I get in trouble – Simples.
Unfortunately no client is worth me loosing my business over, therefore if you are not willing to work this way then I suggest you find yourself a back street unregulated fool who calls themselves an accountant as all regulated accountants must do as I do.
Again, I have numerous clients who will vouch for my integrity.
Whats in a title?
Anybody can call themselves an accountant
BUT……
unfortunately the word “accountant” is not a protected title, thus anybody on the street can advertise themselves as offering accountancy / book keeping services.
Yeah – it’s true – a spotty 19 year old straight out of college working in any fast food chain could legitimately set up in business offering accountancy and tax services to the public. They may well be able to cope with some of the simple stuff and they may be able to use the web to find out about other bits and bobs.
But what happens when they get it wrong or things just don’t happen as they expect? Have they got the experience to legally minimise your tax? What recourse have you got if they misadvise you or they are late filing your tax return?
Absolutely none…end of conversation…as far as HMRC are concerned the buck stops with you the taxpayer.
OK – they may be cheaper than a professional regulated accountant, but as everybody knows – cheapest isn’t always the best in the long run.
Consider what a professional regulated accountant like myself has to offer:
** 7+ years of studying to gain my accountancy qualifications
These are with a recognised UK Chartered Accountancy Institute.
** 25 years practical real life experience of doing book keeping, accounts and tax for every scenario from sole traders to blue chip PLC companies.
** I hold a practising certificate from my institute – this means that:
I hold full professional indemnity insurance (if I ever get your affairs wrong and you decide to sue me, I am covered by an insurance policy)
I undertake the required Continuing Professional Development (training) each year in order to keep up to date and abreast of recent tax issues.
** I issue engagement letters to clients so that we both know what is expected and how to resolve things (if the need ever occurs).
** I am a recognised HMRC agent – I get speedier responses to any queries and I can deal with all the correspondence that you receive from HMRC on your behalf.
** Being a professional, I have credibility with banks and lenders – this always helps when self employed people apply for mortgages or credit if they say that they have an accountant.
** I deal with your tax affairs on time, every time – no more penalties for late filing; no more late nights panicking.
My fees are fixed – guaranteed – no nasty bills for extras.
I normally include an insurance policy in my fee which covers you for my fees should HMRC decide to open an inquiry into your affairs. This type of work will attract a higher premium than normal accounts work – it’s all covered in my fee.
For the weird and wonderful tax situations that I may come across – I have a specialist tax advice service at my disposal – no extra cost to me or you.
You might be reading this and thinking that it all sounds too expensive… get in contact for a quote and you will be pleasantly surprised at how cost effective my services are.
No two clients are the same hence I don’t have a set pricing model.
Is the choice between hiring a professional and a layman now being made that bit easier?
One last word of advice – anybody that is classed as an “accountancy services provider” must be registered with HMRC. If they hold a practising certificate from a UK institute then they are automatically registered and supervised. If they are not registered then they are in breach of the Money Laundering Regulations Act and the associated penalties will apply.
If they are not taking their own business affairs seriously, then why should they treat your affairs any different??
[No offence meant to spotty teenagers or fast food chain workers – it was an example to illustrate a point. Exactly the same applies to ANYBODY who pretends to be something they are not]
Rant over – my profession and accountancy practice is my livelihood – I protect it as any good professional would.
Choose a regulated accountant and you put yourself in the best possible position.
BUT……
unfortunately the word “accountant” is not a protected title, thus anybody on the street can advertise themselves as offering accountancy / book keeping services.
Yeah – it’s true – a spotty 19 year old straight out of college working in any fast food chain could legitimately set up in business offering accountancy and tax services to the public. They may well be able to cope with some of the simple stuff and they may be able to use the web to find out about other bits and bobs.
But what happens when they get it wrong or things just don’t happen as they expect? Have they got the experience to legally minimise your tax? What recourse have you got if they misadvise you or they are late filing your tax return?
Absolutely none…end of conversation…as far as HMRC are concerned the buck stops with you the taxpayer.
OK – they may be cheaper than a professional regulated accountant, but as everybody knows – cheapest isn’t always the best in the long run.
Consider what a professional regulated accountant like myself has to offer:
** 7+ years of studying to gain my accountancy qualifications
These are with a recognised UK Chartered Accountancy Institute.
** 25 years practical real life experience of doing book keeping, accounts and tax for every scenario from sole traders to blue chip PLC companies.
** I hold a practising certificate from my institute – this means that:
I hold full professional indemnity insurance (if I ever get your affairs wrong and you decide to sue me, I am covered by an insurance policy)
I undertake the required Continuing Professional Development (training) each year in order to keep up to date and abreast of recent tax issues.
** I issue engagement letters to clients so that we both know what is expected and how to resolve things (if the need ever occurs).
** I am a recognised HMRC agent – I get speedier responses to any queries and I can deal with all the correspondence that you receive from HMRC on your behalf.
** Being a professional, I have credibility with banks and lenders – this always helps when self employed people apply for mortgages or credit if they say that they have an accountant.
** I deal with your tax affairs on time, every time – no more penalties for late filing; no more late nights panicking.
My fees are fixed – guaranteed – no nasty bills for extras.
I normally include an insurance policy in my fee which covers you for my fees should HMRC decide to open an inquiry into your affairs. This type of work will attract a higher premium than normal accounts work – it’s all covered in my fee.
For the weird and wonderful tax situations that I may come across – I have a specialist tax advice service at my disposal – no extra cost to me or you.
You might be reading this and thinking that it all sounds too expensive… get in contact for a quote and you will be pleasantly surprised at how cost effective my services are.
No two clients are the same hence I don’t have a set pricing model.
Is the choice between hiring a professional and a layman now being made that bit easier?
One last word of advice – anybody that is classed as an “accountancy services provider” must be registered with HMRC. If they hold a practising certificate from a UK institute then they are automatically registered and supervised. If they are not registered then they are in breach of the Money Laundering Regulations Act and the associated penalties will apply.
If they are not taking their own business affairs seriously, then why should they treat your affairs any different??
[No offence meant to spotty teenagers or fast food chain workers – it was an example to illustrate a point. Exactly the same applies to ANYBODY who pretends to be something they are not]
Rant over – my profession and accountancy practice is my livelihood – I protect it as any good professional would.
Choose a regulated accountant and you put yourself in the best possible position.
Subscribe to:
Posts (Atom)