PS I’m aware the right wing blogosphere is sacred witless as a result because they’re seeking to brand me, Polly and the Guardian as hypocrites on tax today. But how would they know? Without any understanding of the issues, how they have developed, how language has changed over time or context – all of which they’d ignore even if they could understand it – they fall back on the only thing they know – ad hominem attacks and abuse. In which case they deserve to be scared witless – because that’s not going to stick with anyone. And I’m certainly not wasting time debating it, again.
Interesting. For today he says that one of the things which counts as tax avoidance is:
People shifting income within families to people who haven’t really earned it, to pay lower tax as a result;
Something which we can see has been happening in the family of one Richard Murphy:
Fulcrum Publishing Ltd:
“Publishes original written materials”, seems to have been his old vehicle for paid writing.
Jointly owned 50:50 by Ritchie and Jacqueline Murphy (same address, born 1963, presumably his wife).
Hasn’t traded since 2003, but when it was trading it paid out all of its profits as dividends. Incorporation and taking dividends from the company instead of a salary is a classic tax/NI avoidance strategy – as he set out in his Observer article.
I wonder how much of the company’s work his wife did, or whether giving her shares was just a device to save tax by transferring half of the income to her? Did “the rewards paid [to her] match the underlying economic substance” (Ritchie’s own test of whether incorporation is “abusive”)? It seems unlikely that she was generating 50% of the profits from his writing.
It’s difficult to see what legitimate non-tax reason he would have for incorporation, and (as he said in his reply to you) he regularly argues against incorporation – for other people.
Would you use such evidence to describe the nation\’s leading retired accountant from Wandsworth as a \”hypocrite on tax\”?
Umm, yes, I think I would, I really do think I would.