Tax Optimisation

Finance Confidential last visited the subject of offshore bank accounts in September 2005.

Margaret Cash warned then that the Revenue was upping the ante against a hit list of 500 suspected tax evaders. This is part of a broader drive to plug tax revenue leaks and raise more cash for stretched Treasury finances.

This week Gordon Brown must have allowed himself a wee smile of satisfaction as the Revenue notched up its biggest victory yet in their longrunning campaign. It is a battle to reclaim tax on interest income from UK holders of non-disclosed offshore bank accounts. ... Read More

But hurry, it won’t be around for long

Company cars are wonderful things. But, for the ‘lucky’ recipients, the joy can sometimes be shortlived: the gloss can be taken away by some quite horrendous tax bills.

In this article, we give a brief round-up of what has been happening on the company car scene over the past year. Some of it is good, some bad. Happily though, no matter what, the opportunity for inventive planning to reduce company car tax bills remains untouched.

We start with a recent tax dispute ... Read More

Loopholes You Can Exploit... And those you can’t

Let’s face it, last year’s budget speech was a bit of a pussycat. It curled itself up on your lap, it made a few contented purring noises at you, and then it went to sleep. It was so bland and so inoffensive that it left the Conservative opposition floundering for anything bad to say about it. This year, however, the cat is well and truly back on the attack. Public spending is overreaching itself horrifically, tax revenues are stagnating, and consumer confidence is on the slide. Mr Brown is now a desperate man with a very large hole to fill.

Which is why the cat’s now running round the kitchen trying desperately to round up any of those cheeky mice who might have been hiding up in the tax loopholes in the skirting boards. Not to mention those clever rodents who’ve been using all the foreign bolt holes out in the neighbours’ garden ... Read More

A victory... of sorts

Six months ago we ran an item entitled "Work-inprogress: another fine mess". There, we looked at the new rules for valuing business work-in-progress. And we concluded that there were two possible — and very different — interpretations of these new rules.

1. Either very many businesses are about to suffer a large one-off hike in their tax bills. That’s because work-in-progress, which used to be valued (broadly) at cost now has to be valued at full selling price.
2. Or there’ll be little change because, in the real world, the selling value of work-in-progress — that is, of unfinished work — is often next-to-nothing.

A reader has asked a question concerning an article which we ran in the January 2005 issue of Finance Confidential — an article which provoked a great deal of interest. (Not to mention disbelief!)

It was entitled ‘Property investors: much more tax relief than you thought’.

Here’s the question.

"You say that if I remortgage my investment property, I can use the additional funds ‘for anything I want’. Does this mean that I could remortgage it to repay the loan that’s outstanding on my own home? And in this way convert a loan, which attracts no tax relief on the interest payments (my home mortgage), into one which gets relief in full (my investment property mortgage)? Surely the Inland Revenue won’t accept that?" ... Read More