The BBC's Panorama reports that Formula 1 boss Bernie Ecclestone has avoided a potential £1.2BN in taxes as a result of a secret deal with HMRC, wherein after a nine year investigation HMRC agreed to accept £10M in 2008.
Shortly afterwards he moved this asset offshore, giving the rights to his then wife, Slavica.
She transferred them to a family trust in Liechtenstein, before selling them for a profit, free of UK tax.
The BBC uses the phrase "tax dodge" but then, in the same sentence, notes that it is legally watertight provided Mr Ecclestone did not set up, or control, the trust.
In a case like this, both HMRC and the taxpayer's lawyers will have arguments/justifications that back up their respective positions. However, at some stage a decision has to be made (by both parties) as to whether the costs of pursuing the case outweigh the costs of coming to a settlement.
Sadly, for those of us without a phalanx of lawyers and deep pockets such "negotiations" never occur. Low hanging fruit (even if not very large) is usually the easiest to pick.
Tax does have to be taxing.
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