The cash crisis that hit the world has had many effects on our economies, our lifestyles and our savings. Here in the UK the government created a massive hole in their finances when they bailed out the banks that were hit hard, in turn this has created a ripple effect that is affecting the citizens of Great Britain. In a bid to plug the cash-gap created by the bail-out HMRC is doing everything in its power to get as much tax revenue coming in as possible. This means thousands of people are being investigated, interrogated, hounded and hassled, and many of these people have done nothing wrong.
Having made their intentions clear with regards to tax evaders, HMRC are now undergoing the dubious process of catching people out - targeting those who may have made small errors when filling out tax returns. In a staggering waste of resources and time a whopping total of 28,000 doctors were sent notices to check whether they are acting in accordance with tax laws and employment, they were specifically asked if they were employing family members for tax reasons! The global financial meltdown also led to rising levels of unemployment the world over and also back here in the UK. More unfortunate citizens out of work means less income for the taxman to claim money from which in turn forces him to take heavy measures against not only tax evaders but also innocent citizens. An important thing to note is that actual tax evaders, people who nefariously set out to deceive HMRC and illegally withhold money, are not common. The majority of Britain’s millions of citizens are hard working and honest, people who have families to look after, and these people are the people who pay their taxes efficiently and on time, why wouldn’t they? Not doing so would only cause them unnecessary stress and the threat of heavy sanctions.
This is why HMRCs aggressive tactics are that much harder to swallow. Since the average UK citizen might not have a financial background, mistakes on the ever-confusing tax forms distributed by HMRC are easy to make. The taxman is pouring over these forms hoping to stumble across mistakes that could lead to fines.
These heavy handed measures smack of desperation and give further incentive for Brits to move abroad and place their funds in an offshore jurisdiction that won’t attempt to tax you till the cows come home. There are many exciting tax-free destinations that welcome expats onto their shores. Understandably moving abroad is not entirely practical for everyone but if you are serious about wealth preservation then it may be something to consider.
Many different countries around the globe have tax systems that are easier on the pocket than ours. You can utilise offshore bank accounts to help you with your cause. To take the next step have a look at our detailed expat city guides to get a view of which countries may interest you and then consult an independent finance adviser to have a look at your finances and discuss ways to preserve your wealth.