We have a clear policy on any tax planning which might be considered “abusive” by HMRC. We do not promote and have not promoted, aggressive or abusive tax planning arrangements.
We wholeheartedly agree with the following statement from HMRC:
“You are entitled to plan your tax affairs in a way that makes sure you do not pay more tax than you have to…. But there is a big difference between using tax reliefs and allowances in the way in which they are intended to be used, and trying to bend the rules to avoid tax.”
HMRC, Tempted by Tax Avoidance, 8th August 2013.
MHA Carpenter Box operates by the following principles:
- Tax is a business cost. It is recognised in UK law that it is legitimate to undertake appropriate tax planning to reduce those costs where possible.
- There is a clear distinction between tax planning within the intention of the UK’s legislation and “abusive” tax planning.
- The UK has developed a highly competitive tax system and there are sufficient reliefs and incentives to enable UK businesses to be run in an efficient and competitive manner from a taxation perspective.
- Planning which is in the spirit of the intention of the legislation enacted by Parliament remains legitimate and should be considered and, where commercially appropriate, can be undertaken by businesses in order that the commercial efficiency of those businesses is maintained.
- Without using the tax reliefs and incentives enacted by Parliament, in the manner intended by Parliament, businesses will soon find themselves rendered uncompetitive and ultimately will fail in the face of more proactive competitors.
- By contrast, we believe that using marketed or “abusive” arrangements which seek to exploit loopholes in the drafting of legislation or which have limited chance of success when placed in the hands of the judicial system is inappropriate and ultimately will lead only to fees for the promoter and costs for the client.
Many of our clients pay tax at effective rates which are significantly lower than the UK’s “mainstream” rates. This is solely due to the proper and careful implementation of the UK’s existing tax reliefs, which are used in a tailored fashion for each client based on their commercial circumstances.