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Ridiculously flawed system in itself, as income can easily be faked. In this case, he's a well paid executive that receives most of his income as income. Howev
by charlesdm 8y ago
Ridiculously flawed system in itself, as income can easily be faked. In this case, he's a well paid executive that receives most of his income as income.
However, the genuine wealthy will receive most of their income as capital gains and dividends, and will hold most assets through companies.
Income wise, they are often paupers in comparison to their (true) net worth.
- everdev 8y agoAn entrepreneur might make a few million one year selling a company, then almost nothing for a few years after if they take a break. Maybe average the last ten years of income to get a better picture? Either way, it's not perfect. Hundred dollar speeding tickets are brutal for low income families.
- NeedMoreTea 8y agoThere are usually consequences like imprisonment, or additional higher fines, for lying to the tax authorities. So faking your income on a tax return may be considered high risk. It's perfectly possible to consider dividends income as the UK mostly does, and maybe include capital gains as well to arrive at an overall figure for the year after allowances and indexation. No system is perfect, but seems far less flawed than prescribed fines that sees a millionaire barely notice a £100 parking fine, but someone on minimum wage almost getting wiped out by the same. To me it;s crazy not to reference income, ability to pay or worth when assessing penalty.