According to an investigation carried out in 2002 by Tax Action (a company set up to promote independent financial advice), as a nation we paid out nearly £4 billion in unnecessary tax in the year 2001-2002. Well over £80 million went on fines and penalty interest paid by the 808,000 taxpayers who failed to get their tax returns in on time. But most came from people paying more tax than they legally had to. Deliberately concealing income or gains - or claiming bogus expenses - is tax evasion and it's a crime. But taking legitimate steps to avoid tax by exploiting the tax rules is perfectly acceptable.
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