Synopsis: The Daily Mail has “rated” 11 “Tax Dodges” to categorise users as “saints and sinners”

The latest press fascination with tax avoidance started with tax evasion and Swiss bank accounts, moved to deeds of variation and the Millibands and has now moved on to the publication of a self-styled ‘naughty and nice’ list of ‘tax dodges’.

To group all of the strategies listed in the Mail under the heading ‘tax dodges’ is immediately misleading. ‘Dodge’ implies, at best, avoidance and at worst illegally getting out of liabilities that others face up to.

Most of the strategies listed, including:

 Investing in an ISA

 Making a contribution to a registered pension

 Using the £3,000 annual IHT exemption

 Making a life policy subject to trust

 Investing in a single premium bond to defer tax and encash in a year when taxable income is lower

are all perfectly permissible and specifically contemplated by the legislation. By executing these strategies one can hardly be accused of ‘dodging’ tax – you are accessing reliefs and being taxed on precisely the basis directed by the law. No contrivance. No steps inserted with no commercial purpose – just simple transactions.

The Mail also lists some potentially more contentious strategies but doesn’t really describe them that well, for example, ‘Taking out a massive loan and then paying yourself an income from it’ is probably not the most accurate description of what they had in mind.


The most damaging aspect of the Mail’s ‘special report’ is grouping all of the strategies together under a ‘global’ heading ‘tax dodges’. The implication is clear – anything that saves tax is inherently ‘dodgy’.

For example, the Mail say, in relation to making a pension contribution, ‘it’s not avoidance – but its crafty’.

As we have said before, financial planners have an important job to do in reassuring their clients with absolute clarity over what is and isn’t permissible.

Just because a strategy is tax efficient doesn’t mean it’s a ‘dodge’ to be frowned upon.

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