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Press comment: The UK's tax gap illustrates a system in need of simplification

20/06/2019

If you are covering the HMRC’s publication exploring UK’s tax gap, which is the difference between the amount of tax that should, in theory, be paid to HMRC, and what is actually paid, please see the following comment from Rachael Griffin, tax and financial planning expert at Quilter:

Rachael Griffin"Although 94.4% of all taxes successfully collected by HMRC represents an achievement for the government, the fact that the most common reason for tax not being paid is simply down to people failing to take reasonable care likely illustrates a system in need of simplification. This therefore shows that the government is currently paying a premium of £6.4bn every year for its overly complex tax system. The achievement is also further eroded by the fact that the government posted the exact same tax gap of 5.6% in 2011 showing that over a number of years HMRC are still unable to plug some of the holes contributing to this issue.

"While celebrity tax avoidance schemes are typically high up the press agenda, these types of issues are actually one of the smallest contributors to the tax gap. These figures paint a picture of a public very happy to pay tax but are simply making avoidable errors due to the fact they can’t navigate what is a very complex system.

"New schemes such as Making Tax Digital should further help to streamline the process and make sure that people pay the tax they owe and avoid unintended errors. Making sure all members of society pay tax is an essential part of our system. Fixing the nations taxation system is going to be become increasingly important in the uncertain political landscape we now find ourselves in and in harder fiscal times harsher penalties are sometimes applied. For those worried that they are going to make mistakes when filing their tax returns, seeking professional financial advice can help alleviate the worry and make sure that you are paying exactly the amount you owe."

For more information contact

Alex Berry023 8072 626007741 151931alex.berry@quilter.com

Notes to Editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £118.7 billion in investments (as at 30 September 2019).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions; and discretionary fund management.

The business is comprised of two segments: Advice and Wealth Management and Wealth Platforms.

Advice and Wealth Management encompasses the financial advice business, Quilter Financial Planning; the discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

Wealth Platforms includes Old Mutual Wealth UK platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

The Quilter plc businesses are being re-branded as follows: 

  • Quilter Financial Planning (previously Intrinsic)
  • Quilter Private Client Advisers (previously Old Mutual Wealth Private Client Advisers)
  • Charles Derby Group (becoming Quilter Financial Advisers)
  • Quilter Financial Adviser School
  • Quilter Cheviot
  • Quilter Investors
  • Old Mutual Wealth (becoming Quilter Wealth Solutions in 2020)
  • Old Mutual International (becoming Quilter International in 2020)

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This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.