The debate about tax avoidance continues unabated, with recent headline grabbers including the "Paradise Papers" which revealed that - surprise surprise - individuals and entities held assets and investments through offshore structures and a piece this week on how the likes of Amazon and eBay 'facilitate' tax evasion by not policing the VAT status of traders using the online platforms. The BBC has led the rhetoric on these issues with headlines such as 'Paradise Papers: Tax haven secrets of ultra-rich exposed' (6 November 2017) and 'BBC Panorama: The fraud costing the UK £1bn a year' (27 November 2017). The latter headline was actually from a piece advertising the BBC's own output.
Both these topics that seem to be hobby horses of the BBC are characterised by sensationalist and flimsy journalism (including an ambush of a senior HMRC official in the Panorama programme), and we have witnessed at first hand ourselves how an ill-researched and frankly libellous piece of BBC reporting (including totally unfounded allegations of tax avoidance that were subsequently rebutted) almost put a client of ours out of business jeopardising thousands of jobs. As with much reporting, the mischievous headlines make a splash, but and subsequent demonstrations of inaccuracy are not deemed to be newsworthy and do not merit comment.
Whilst we do not condone tax avoidance or tax evasion, we would at least expect balanced reporting, particularly from the BBC. However, what the BBC seems less keen to comment upon is its own far from blemish-free tax history. You would think that senior BBC presenters such as Fiona Bruce, Jeremy Paxman and Sophie Raworth were on the BBC payroll for example? Well, they are now, but only after it became apparent that previously the BBC engaged with them via Personal Service Companies (a move which had it been any other entity the BBC would no doubt have cried foul over! The Daily Telegraph reported this in some embarrassing detail back on 22 July 2016 as "BBC brings 85 presenters on staff after being told to ditch personal service companies". The uncomfortable details can be read here.
Imagine then the subsequent embarrassment by the news that a number of senior BBC figures were caught up in the scandal caused by the 'Christopher Lunn affair' when it became apparent that the accountant of choice for highly rewarded BBC presenters - Christopher Lunn - was complicit in and convicted of fraudulent activity relating to the tax affairs of his clients. The BBC were less keen on reporting this. However, it is worth reading this article which gives some background. The aftermath of Christopher Lunn's actions caused such tax mayhem that HMRC set up a special gateway to enable former client's of Mr Lunn to disclose all irregularities and settle outstanding taxes with HMRC in return for a "light touch" treatment.
Other BBC "stars" using Personal Service Companies included Chris Moyles, who by all accounts was lucky to avoid a criminal investigation into his use of the "Working Wheels" tax avoidance scheme. Really, BBC?
As recently as July 2017, the Mail Online reported that "BBC stars are STILL dodging their income tax: High-profile presenters routing salaries through personal companies despite corporation banning the deals five years ago". This link gives more details.
All of which makes us shrug our shoulders when we read yet another article in the BBC's long-running agenda of unbalanced and ill-informed journalism regarding tax, particularly when, in the case of our client, such an approached was business damaging and almost critical. Real jobs and livelihoods were on the line with no real right of response (the BBC were not interested in the actual facts - why let the truth ruin a good story)?
So, when you read the news, please do take it with a pinch of salt.
If you would like to discuss any tax issues, or have any comments, please do let us know.