Err, no, this isn’t quite right

The Murphmonster:

Campaigner Richard Murphy, of Tax Research, said: “It’s legal for a non-dom to avoid tax on non-UK source income.

“The question is should the adviser to a party that says it wants to end tax haven abuse take advantage of that opportunity and stay in their post?”

Err, no.

No tax is due from a non-dom on non-UK source income as long as it remains outside the UK. Given that no tax is due then there’s no possibility of tax avoiodance, is there?

17 thoughts on “Err, no, this isn’t quite right”

  1. “It’s legal for a non-dom to avoid tax on non-UK source income.”
    No!!!! Non-remitted non-UK sourced income is not chargeable on a non-dom, so it’s not avoidance.
    This is expressly stated by Parliament. This is the standard he applies to Labour donors.
    Open question Ritchie (though you’re too much of a coward to answer me): do you,a) not understand, which makes you out of your depth or b) know but not care (which makes you a hypocrite)?

  2. In fact, Mr Murphy, to take tax from a non-dom in respect of non-UK income is;

    a) None of your business and

    b) theft

  3. The advisor should say “not-remitted non-UK income is not chargeable for you. There isn’t a decision to be made, no ethical judgement to be exercised; you’re just not chargeable. Now go home and sleep easy”.

  4. should the adviser to a party that says it wants to end tax haven abuse take advantage of that opportunity and stay in their post?

    Only if they write it up for an article in the Observer.

  5. “It’s legal for a non-dom to avoid tax on non-UK source income.”

    No, it is not. Surely, the non-dom should be paying the tax in Germany or Hong Kong or wherever, just not in the UK which has no right to it.

    It seems that the only tax that matters is the tax that will keep the feather-bedding going.

  6. Jonathan Pearce

    Yes quite right, and I should have made that very clear.

    It does add to the avoidance point though doesn’t. Here’s the return, here’s the box to tick and here’s how you pay your levy; no avoidance involved. And if you don’t tick that box and then don’t declare the income then it’s evasion; not avoidance.

    P.S. There is quite a chance much of this income is already taxed and a UK charge would be at least partially covered by DTR, so you might decide not to tick the box. This is what the advisor should be doing, quite irrespective of any discussion with his client or remit received on engagement. Of course he should take advantage of every relief Parliament expressly intends.

  7. The Mirror quotes a spokesman as saying that Rutland pays all the taxes due in Malta. So it isn’t even avoiding tax.
    [Also it does no business in, or with, the UK, and hasn’t paid any dividends to anyone in the UK so it cannot be used for tax avoidance]

  8. John77

    It actually might not be that simple in this particular case. If it’s originally paid by a UK business (please God not a political party) for work done in the UK, then it’s difficult to see how M Crosby hasn’t affected a transfer of his own income, or how Rutland doesn’t have a Permanent Establishment in the UK.

    P.S. Jonathan Pearce, Yes I know Malta is in the EEA.

  9. @ Ironman
    It might not be, if … – but in this particular case it is.
    I quote: “There is no suggestion that Mr Crosby or Rutland have done anything illegal.
    A spokesman for CTF Partners said: “Rutland is a legitimate company, which fulfils all its tax obligations in Malta.
    “It has never done any business in the UK or paid any dividends to anyone in the UK.
    “It has not received fees from any UK company, body, or individual. Any claim, or attempt to claim, that it was set up, or is used, to avoid paying UK tax is categorically wrong and highly damaging.”

    The Mirror’s smear campaign is really dredging the barrel with this one.

  10. John77

    “It has never done any business in the UK or paid any dividends to anyone in the UK.”

    That’s that then; the facts. I’ve just read Ritchie’s post. It’s quite clear he doesn’t know the facts and isn’t hanging around waiting to find them out. In other words, he’s blagging it again. It’s funny, because he’s on Twitter this pm preaching about corruption. I think making false representations to be a tax epert is pretty fraudulent. And no, it doesn’t matter that you leave others to make the claim for you. If you don’t correct them and leave the claim on your blog’s homepage, then you are making the claim.

  11. John77

    I’ve tried to post the CTF quotes on Ritchie’s blog. Not there yet, we’ll see if it makes it.

    Candidly, I doubt it will.

  12. I reckon it is avoidance. It requires a positive step (assertion that you are not domiciled in the UK and payment of the levy) in order to avoid being taxed on your worldwide income. The default position is that you pay tax on the lot. It’s avoidance that nonetheless results in income to the state, but I don’t think that stops it being avoidance does it?

  13. @ Fatty
    Paying tax in Malta is avoidance?
    Paying tax in the country where the income is earned is avoidance?
    For Obama’s pollsters who are liable to pay tax in the USA on their worldwide income it is tax avoidance if they don’t pay tax in Malta, the UK and the USA on the same income?
    Er, no that would hurt.
    So for Lynton Crosby who pays his full rate of tax in every location? No he is not a member of the Grauniad clique so anything he does must be wrong

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