NoRegretsCoyote
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This Tax Appeals Ruling may be relevant.
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Of course they have meaningful effects, in common with pretty much all transactions, but that doesn't mean they get a free pass from anti-avoidance legislation.This would tend to support @Gordon Gekko 's view that contractual transfers between spouses have meaningful effects when it comes to tax.
There is no lower limit in legislation. But of course there’s a lower limit in the real world.No answer to my first question.
Reading between the lines of the judgement it appears that the spousal transfer was probably part of an attempt by the couple to balance their income most efficiently for income tax between them. But Revenue seemed to have said "well if you're going to do that we'll get you back on the Section 23 relief".but that doesn't mean they get a free pass from anti-avoidance legislation.
I didn't get that impression at all.Reading between the lines of the judgement it appears that the spousal transfer was probably part of an attempt by the couple to balance their income most efficiently for income tax between them.
The circumstances of this case appear to be very different plus more nuanced and detailed.Reading between the lines of the judgement it appears that the spousal transfer was probably part of an attempt by the couple to balance their income most efficiently for income tax between them. But Revenue seemed to have said "well if you're going to do that we'll get you back on the Section 23 relief".
Couple were also attempting to claim mileage to and from property as a deductible expense which suggests that they were pushing the envelope very far already.
If I've mis-read this please correct me. It is of course just one case but does cast some light on the principles involved.
It is not a legal grey area. It is normal tax planning/tax efficiency which Revenue have no issue with. The amount of tax involved is tiny and it is highly unlikely that the original poster is an audit candidate anyway.Only a tiny percentage of such disputes ever get as far as the Tax Appeals Commission let alone a courtroom. In almost all cases, the client either doesn't have the stomach or the resources to fight that far. Revenues officials know this and are trained to scare people into coughing up when they've relied on a legal grey area like this.
Obviously (I would have thought) it applies from spouse to spouse.Does this only apply from men to women?
The legal grey area is the assumption that there is a de minimis limit for general anti-avoidance legislation.It is not a legal grey area. It is normal tax planning/tax efficiency which Revenue have no issue with. The amount of tax involved is tiny and it is highly unlikely that the original poster is an audit candidate anyway.
I've thirty years plus experience working as a tax advisor. This is tax planning and is used routinely, without issue.The legal grey area is the assumption that there is a de minimis limit for general anti-avoidance legislation.
That's OK.I've thirty years plus experience working as a tax advisor. This is tax planning and is used routinely, without issue.
This doesn't even get near the GAAR and, in any event, deploying S.811 is a serious undertaking for Revenue with its recharacterisations etc. It is not used for mickey mouse stuff.
Does a couple have to go to the bother of a change of ownership in order for one spouse to declare all rental profit as their income?I've thirty years plus experience working as a tax advisor. This is tax planning and is used routinely, without issue.
I'd love to hear an opinion on this too!Does a couple have to go to the bother of a change of ownership in order for one spouse to declare all rental profit as their income?
Or is it sufficient for one spouse to simply declare it as such every year?
I don’t think that’s a runner at all.I'd love to hear an opinion on this too!
On the face of it it would appear far "too easy" and rent could be shuffled around at will to avoid tax. I always assumed that at the very least a limited life interest would need to be formally granted to the other spouse to make this legit.I don’t think that’s a runner at all.
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