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Press comment: HMRC report shows shift in attitudes toward tax avoidance 

24/04/2020

If you are covering the newly published HMRC report into tax avoidance please see the following commentary from Rachael Griffin, tax and financial planning expert at Quilter. 

The report surveyed accountants, financial advisers and other tax specialists. Respondents felt there had been a ‘shift in the public and political mood’ towards avoidance but that there was still ‘ambiguity about what was deemed acceptable by HMRC and a grey area created where activity could be legal but still unacceptable’.

Rachael says:

“There has been a huge amount of publicity in recent years surrounding HMRC’s investigations into evasion and aggressive tax avoidance. Since the financial crisis there has been a growing feeling that the super-wealthy are dodging their taxes unfairly and HMRC has been seen to take an increasingly politicised role in clamping down on bad behaviour. We’ve seen the tax authority challenging the arrangements of celebrity figures, and campaigns have raised awareness of HMRC’s powers to look into our tax affairs.

“As a result it has become a high profile issue, and this research suggests that there has been a marked impact on attitudes to aggressive tax avoidance schemes which push the push the envelope. People are now more likely to steer clear of schemes that skirt close to the boundaries of what is acceptable for fear that it may be challenged at a later date.

“It is right for HMRC to challenge aggressive tax avoidance when it breaks the spirit of the law, even if it didn’t technically break the letter. However, we should be careful that legitimate tax planning doesn’t become collateral damage. Simple things like putting money into an Isa are a way of ‘avoiding’ taxes like Capital Gains Tax (CGT). Thankfully, most people can recognise that an Isa is an approved structure designed to incentivise saving. But when it comes to something like Inheritance Tax (IHT), where families often use lifetime gifting allowances to mitigate IHT, some people might be put off entirely legitimate tax planning because they struggle to recognise what is and isn’t acceptable.

“Despite the high profile clampdown on evasion and aggressive tax avoidance, it is important to remember most tax planning techniques are entirely legitimate and the vast majority of insurance based schemes are mainstream, vanilla tools that the Revenue are comfortable with. The Government is focussed on tackling some of the more esoteric tax arrangements, but that should not but people off normal tax planning methods.”    

For more information contact

Michael Glenister020 7778 963807469 144535michael.glenister@quilterinvestors.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 £95.3 billion in customer investments (as at 31 March 2020).

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 and Quilter International, including AAM Advisory in Singapore.

The Old Mutual Wealth Heritage life assurance business was acquired by ReAssure Group Plc on 2 January 2020.

Since its IPO in June 2018, Quilter plc’s businesses have progressively rebranded to Quilter, as follows: 

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

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

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.