Here's an example from yesterday's Sunday Times:
I've highlighted a key point. As in many such cases when you read carefully it becomes clear that the tax avoidance activity in question is 'entirely legal'. I drew an analogy between this approach to tax avoidance and the rule regarding MPs expenses on the blog last week (and indeed last year!)
HM Revenue & Customs (HMRC) is thought to have begun a fresh wave of investigations into so-called “image rights” payments by Premier League clubs to their playing staff.
Such arrangements, which are entirely legal and are commonplace, allow players to channel part of their pay into private companies set up for their benefit.
It seems clear that the objective of these announced crackdowns can only be to catch out the amateurs - those who have copied the avoidance technique but without taking informed professional advice. As a result they have probably missed the subtle nuances that are required to achieve the desired tax outcome. And this means that the amateurs are at risk of getting 'caught' but that the experts continue to 'get away with it' - until the law is changed.
On the one hand this situation is great for tax advisers who are well placed to help 'amateurs' to secure the same tax benefits as the 'professionals'. On the other hand are the press reports simply scaremongering?
Recent and prospective cuts in staff numbers mean that HMRC do not have the resources to investigate many of the tax avoiders in question. And as long as the tax planning involved is legal the time and effort involved in such challenges could generate a better return if focused on chasing illegal evasion.
Would it not be a better use of time, effort and money if the law were changed to counter the tax avoidance in question? It may not be easy to achieve the desired outcome but it's not impossible either. Is it?