We all hear every day that a woman’s work – especially at home – is not compensated for or appreciated. The Government and courts have on numerous occasions told us that something needs to be done about this unfair treatment of women.
While I do not know the exact details of the Arctic Systems case in as much as Mrs. Jones was working at home or full time in the office, it appears to me, that here is a mechanism that compensates women for their efforts at home.
Indeed it appears that the government of the time was fully aware of the consequences of it’s tax legislation, when Minister Norman Lamont said:
“Independent taxation is bound to mean that some couples will transfer assets between them with the result that their total tax bill be reduced. This is an inevitable and acceptable consequence of taxing husbands and wives separately….we have made it clear that we expect income splitting will occur.” – thanks to Mark Lee for this.
Surely the HMRC knew about this, it’s assertion that it puts other business at an disadvantage or is unfair to other tax payers is the usual smokescreen, when they have wasted lots of tax-payers money on a court case that should never have been.
The Government needs to realise how important small business is for the economy and learn to appreciate that running a business has an affect on the whole family of the small business owners. IMO the arrangements between Mr. & Mrs. Jones have been entirely fair and proper, no matter if Mrs. Jones or any other partner worked in the business or not, they certainly contributed to the success of the business by supporting her husband. I guess that may be somewhat difficult for an civil servant to understand.
But as usual HMRC has made a big mistake and small business and families will be made to pay.