Trump's tariff wars...long post.

[prowla]

43 minutes ago, Burns-bass said:

The Government does this by applying a 25% uplift to post tax pension contributions. This equals it pit, pretty much.

 

Many of the “benefits” of running a Ltd company are created that way to enable people to deal with a variable income. Mine fluctuates widely across the year, for example.

 

Britain is a strange place where economic growth is vital, yet we often treat business people as if they’re all on the take. Strange.

Just choosing to take a dividend at the end of one year or the start of the next is avoidance.

(And there's nothing wrong with it.)

[prowla]

16 hours ago, tegs07 said:

I’m not sure I would class this as tax avoidance as in many ways you’re just shifting the tax payment from one stage of life to another. It’s not like pensions are a tax free benefit. It’s also shifting the burden of care from state responsibility to private responsibility.

If you pay less tax as a result then it is avoidance.

It's a common strategy for people in the 60% tax bracket: pay into that on the basis that you'll be in a lower bracket when you come to withdraw it.

Hence avoiding tax.

[SteveXFR]

20 minutes ago, TimR said:

 

Should unemployed people be given free money? How is that treating everyone the same.

 

That depends on the situation. For people too sick to work or those temporarily out of work due to unavoidable circumstances, yes, definitely. 

Too lazy to work, no, but thats a tiny minirity. Despite what the Telegraph says, unemployment benefit is a tiny payment and very, very few people want to live on that.

The problem is that most people on benefits are working but wages are so low that they need topping up. Its effectively subsidising businesses paying crap wages.

[Steve Browning]

10 minutes ago, prowla said:

If you pay less tax as a result then it is avoidance.

It's a common strategy for people in the 60% tax bracket: pay into that on the basis that you'll be in a lower bracket when you come to withdraw it.

Hence avoiding tax.

Bear in mind that it is an established legal principle that people organise their affairs to pay the least amount of tax.

 

Duke of Westminster case 1936.

[prowla]

17 minutes ago, tegs07 said:

So from the comments from Witcoff it looks like the USA is firmly in the Russian grip. Trump is totally seduced by the idea of making money from Ukraine and Russia.

 

Its fairly easy to see big chunks of Ukraine being ceded to Russia with no backstop or any security guarantees.

Next up is the time to re-arm and take the entire country in a few years time.

 

In the interim there will continue to be hybrid warfare in Europe. Disinformation and election interference will probably mean Hungary and Romania will be pro Russian and voting against the EU in security issues and in terms of DEI and other core EU principles.

 

At some point I expect para military activity in Estonia and Moldova to “demilitarise and de-natzifi” the areas for the Russian speaking population.

 

To make matters worse NATO is no longer an effective deterrent without Article 5 and there is already evidence that US intelligence can be cut off at will to suit any Trump agenda. This intelligence is deeply embedded with the US and difficult to untangle. NATO are effectively blind without the USA.

 

The mechanisms for feeding intelligence about Russian threats via the CIA and the training and geopolitical awareness strategies for the US military are systematically being dismantled. This is unprecedented and will weaken the US ability to determine present threat levels (they will be decided by the Trump inner circle) and destroy the massive advantage that the USA always had of staying one step ahead of what to invest in to prepare for future war and conflict.

 

We are sleepwalking towards some serious re-shaping of the world order and our biggest ally is slowly becoming a threat to European economic and physical security.

 

Edit: @peteb do I think you are correct about China becoming more of an ally to Europe than Russia. Yes and No. I don’t think it’s possible to untangle the Russian military alliance to make a clear case for this but under the Trump administration the USA is well on the road to becoming a Russian puppet state.

 

I think it's a little bit different: Trump and Putin have congruent aims: one wants to unite the states of the former USSR and the other wants to subsume the countries of North America (plus the Gaza resort).

Putin is playing Trump, but Trump is going along with it because they are on the same path.

 

[prowla]

1 minute ago, Steve Browning said:

Bear in mind that it is an established legal principle that people organise their affairs to pay the least amount of tax.

 

Duke of Westminster case 1936.

Precisely, and that is why tax avoidance is not wrong.

[Downunderwonder]

31 minutes ago, tegs07 said:

NATO are effectively blind without the USA.

The European Space Agency might not have the cheap launching that SpaceX can provide but they have a big rocket and can build satellites. Might be sticky for a little while but they would be silly not to have already started planning for their own spy satellites hanging out over Putin and his minions.

[tegs07]

1 hour ago, prowla said:

 

I think it's a little bit different: Trump and Putin have congruent aims: one wants to unite the states of the former USSR and the other wants to subsume the countries of North America (plus the Gaza resort).

Putin is playing Trump, but Trump is going along with it because they are on the same path.

 

Trump is being played I totally agree with that. As for granting him intelligence to be one step ahead you are very generous. His Gaza ‘plan’ is logistically impossible. Migrate 2.5 million people across desert with limited infrastructure to countries that are sympathetic to the plight of muslins but have no desire to inherit a unsolvable political crisis.

Finally Gaza. It’s no jewel in the middle east. Thinking that it’s going to be paradise and attract millions of tourists is idiotic.

Trump basically declared war on Iran (via social media) a few days ago. The middle east is no quick fix even for the greatest of diplomats. 

North Africa is already firmly in the Russian sights and influence and France is clinging on to its position there.

Put simply Trump is completely delusional IMO that Russia has any intention of working for the USAs long term interests. China and Russia will attempt to reshape the world order and Trump and MAGA are just useful idiots to help them do so.

Edited Sunday at 10:12 by tegs07

[Downunderwonder]

3 minutes ago, prowla said:

Precisely, and that is why tax avoidance is not wrong.

How much is possible is where the wrong lies. There are plenty of examples of big corporations getting away with blue murder legally.

[tegs07]

1 minute ago, Downunderwonder said:

The European Space Agency might not have the cheap launching that SpaceX can provide but they have a big rocket and can build satellites. Might be sticky for a little while but they would be silly not to have already started planning for their own spy satellites hanging out over Putin and his minions.

Absolutely. It can be done. I am sure that behind closed doors plans are already being discussed and I would hazard a guess that the 5 eyes are already concerned considering that anything they know, Putin can potentially know at this stage.

[Steve Browning]

6 minutes ago, prowla said:

Precisely, and that is why tax avoidance is not wrong.

Exactly. 

[Downunderwonder]

By an accident of geography NZ is in the 5 eyes! I don't think we know a hell of a lot but we help out in lots of ways.

[Steve Browning]

1 minute ago, Downunderwonder said:

How much is possible is where the wrong lies. There are plenty of examples of big corporations getting away with blue murder legally.

You are absolutely right from a moral standpoint but you're not getting away with anything if you act within the Law. 

 

This is rather straying from the topic. How we tax corporations is a whole different subject really. 

[super al]

2 hours ago, Steve Browning said:

 

I find that a little odd. What do you find complex? That's a genuine question. 

 

There are a lot of free resources to help. Even the HMRC guides for inspectors are on line. 

 

Anyone struggling to understand VAT needs to listen to our song...VAT.

 

A Little bit of light relief for the orange one's thread 😄

 

 

[Burns-bass]

2 hours ago, prowla said:

If you pay less tax as a result then it is avoidance.

It's a common strategy for people in the 60% tax bracket: pay into that on the basis that you'll be in a lower bracket when you come to withdraw it.

Hence avoiding tax.

 

If this is your logic, so is putting money into a tax-free investment vehicle like an ISA.  Terms like "tax avoidance" are used pejoratively.

 

Graveyard of ambition this country...

[tegs07]

17 minutes ago, Burns-bass said:

 

If this is your logic, so is putting money into a tax-free investment vehicle like an ISA.  Terms like "tax avoidance" are used pejoratively.

 

Graveyard of ambition this country...

ISAs and SIPs, particularly stocks and shares ISAs for me are another vehicle shifting responsibility from the state to the individual. The demographic changes of an aging society make government provision for our futures very difficult. Government also need to raise funds by selling treasuries so encouraging people to invest in a balanced portfolio is crucial.

Viewed in this context I don’t see these vehicles as tax-avoidance but more like delayed taxation. When we are young it is likely savings for big ticket items like houses (with hefty taxes) and when we are older used to fund things like paying down loans and mortgages as well as for retirement. The government still gets their slice just at a later date with the added bonus that the individual is expected to pay for the lion’s share of their future care rather than relying on the state.

 

When I think of tax-avoidance I am thinking of things like employing a spouse at £50K a year who doesn’t actually do any work, putting your 20 BTL properties into a company and making a loss on the company each year etc Tax evasion or avoidance? I don’t know. I am sure people can advise but there things are not uncommon and as far as I understand not illegal (or at least are very difficult to disprove).

Edited Sunday at 11:33 by tegs07

[PaulWarning]

Interesting
https://taxpolicy.org.uk/2024/10/26/what_is_tax_avoidance_how_different_from_evasion/#:~:text=So here are some things,Not tax avoidance.

[oldslapper]

To go out of one’s way to avoid/evade/minimise tax contributions speaks volumes to me about the “evolution” of society. 

To be able to contribute and help fund basic social needs such as health care, housing, safety, education, transport, sanitation, etc is a privilege and one that should be celebrated. 

I hate this world more and more. 

[tegs07]

9 minutes ago, oldslapper said:

To go out of one’s way to avoid/evade/minimise tax contributions speaks volumes to me about the “evolution” of society. 

To be able to contribute and help fund basic social needs such as health care, housing, safety, education, transport, sanitation, etc is a privilege and one that should be celebrated. 

I hate this world more and more. 

I know someone (now living in the USA where the family business has relocated to) who was earning nearly £70K a year as a “consultant” to the company. He had an MBA and despite never going to the office did make several phone calls a week, had lunch and played golf with his boss (Dad) several times a week and went on business jollies (trade fairs etc).

All legitimate but mostly social activities.

 

Edit: Mum and grandad were also employees and sister was joining the family business after graduation. I am sure none of this was tax avoidance but honest graft.

Edited Sunday at 12:00 by tegs07

[Agent 00Soul]

I always thought that the government created these loopholes deliberately because at the end of the day they ultimately feel that having more money moving around is better for the country than collecting it as tax.  In other words, they want you to take advantage of them.

[peteb]

42 minutes ago, Agent 00Soul said:

I always thought that the government created these loopholes deliberately because at the end of the day they ultimately feel that having more money moving around is better for the country than collecting it as tax.  In other words, they want you to take advantage of them.

 

Well that's a ridiculous idea for a start. The large amounts that are saved by taking advantage of these loopholes are generally by the super wealthy who then shift the money into an offshore account or into buying assets. The money is never circulated in the general economy. 

 

A lot of loopholes are created for positive reasons, but are then allowed to be exploited by those with lots of money. For example, allowing tax relief on money invested in pension funds is supposed to encourage medium earners to build up a sufficient pension so that when they retire they can still live a good quality life, still contribute to the economy, still pay tax and never have to use top-up pension benefits. However, the same scheme used by those earning £60k is used by those on huge salaries to build up huge pension pots to avoid income tax, so that they can access a massive tax free payment when they retire. There are those on the right lobbying for there to be no limit to what this tax free payment could be. 

 

Edited Sunday at 13:11 by peteb

[peteb]

1 hour ago, PaulWarning said:

Interesting
https://taxpolicy.org.uk/2024/10/26/what_is_tax_avoidance_how_different_from_evasion/#:~:text=So here are some things,Not tax avoidance.

 

This is all a bit 'nothing to see hear, move along'! 

 

Why doesn't it mention the common practice of the very wealthy to not take a appropriate salary and to re-invest dividends into stock, which is never taxed as the the profit in the stock is never realised, but then to borrow money to maintain a lavish lifestyle at a far low interest rate than they would pay in income (or even capital gains) tax, using the stock as collateral? The argument here is that you can't tax wealth held in stocks as they could tank and be be worthless next month, but somehow these potentially 'worthless' stocks can be used to secure low interest loans, to be used instead of taking a taxable salary. 

 

Also, no mention of K2 type schemes, which became famous when Jimmy Carr was publicly shamed for participating in! 

 

Edited Sunday at 13:25 by peteb

[TimR]

49 minutes ago, peteb said:

However, the same scheme used by those earning £60k is used by those on huge salaries to build up huge pension pots to avoid income tax, so that they can access a massive tax free payment when they retire. There are those on the right lobbying for there to be no limit to what this tax free payment could be. 

 

But there is a limit on both how much you can put away each year and how much you can withdraw as a 'tax free lump sum'. 

 

And even then you have to put the lump sum somewhere which will the attract tax on anything it earns over a set level.

 

These are all calculated based on how much it would cost to administer, how much it would cost someone to avoid paying it and how much it would cost them in Tax.

 

If you get the balance right it costs little to administer and it's more cost effective for the person to just pay the tax than it is for them to spend time and money avoiding it.

 

This is why a lot of the really big companies don't appear to pay the tax they appear to should be paying. They're already paying large amounts of employers income tax and NI. You then try and tax them more and they'll simply pay their employees less and the tax shrinks. You then have the problem of paying lots of tax inspectors to try and unpick what is going on and what is due.

 

Trump is going to simply all this. No one pays any Tax. All the government revenue will be raised by Tarrifs on imports. The best part is there's no government expenditure as everything will be privatised. Ultimately there's then no need for anyone to collect taxes. Who pays for Police, Fire and Education? No one, you won't need them because Americans are all God fearing people and there won't be any immigrants causing fires, crashes, or crimes. Thoughts and Prayers will be all that are needed. 

[Agent 00Soul]

30 minutes ago, TimR said:

Americans are all God fearing people

 

Not true - everyone in my immediate family, including all but one of my grandparents, are atheists.

[TimR]

41 minutes ago, Agent 00Soul said:

 

Not true - everyone in my immediate family, including all but one of my grandparents, are atheists.

 

Don't let Trump know that. Atheists are next on the Enemies of the State list...