Business

Has Hiding Cash Become A Crummy Business?

4/18/2016 Dhanur Chauhan 0 Comments

It used to be common for the rich and wealthy to hide as much cash as they could. This was considered perfectly acceptable and few people had any problems with it. But the release of the Panama Papers has changed everything.

Although it has built upon a growing anti-rich trend in the past few years, this is the final nail in the coffin. Organizations like ukhomeandpersonalloans.co.uk are now firmly of the belief that hiding cash has become a crummy business.

Is it Legal?

Despite the coverage surrounding the Panama Papers, apart from a few exceptions everything the people involved have done is perfectly legal. The difference between tax avoidance and tax evasion are profound. Avoiding tax and hiding cash is done in a legal way using a range of financial mechanisms set up for this purpose.

The point is not that it’s legal, though. The point is that the general public don’t like the fact it’s legal. The term ‘the spirit of the law’ has been bandied around often.

Public Image Crisis

The next generation of people is different from the last. They are more socially conscious and more willing to pay tax. On the other hand, they are less willing to pay fees before tax. There’s a sense of social responsibility that didn’t exist with the Baby Boomer generation.

While it’s true that a lot of people have no reason to care about negative press surrounding their tax arrangements, anyone in the public eye now has to think twice. This includes politicians, but it’s also applicable to leaders of large companies.

Millennials have even been known to go as far as to not deal with companies simply because their leadership teams are known for avoiding tax.

So What Should You Do?

Hiding cash, when done legally, is perfectly fine and valid. But these days you have to understand that there’s a trade-off. Someone in the public eye shouldn’t hide their cash because it could cost them far more later on. The right way to react is to be fully transparent about your financial affairs.

It may well mean taking an initial financial hit, but by being morally correct and socially responsible you could enhance your company brand.

It’s important to mention that while the rich and powerful may use off-shore trusts to shelter their cash, the majority of people also do their fair share of hiding cash. This can be as simple as paying a local contractor in cash so they can get out of paying tax. It can be claiming a little extra when it comes to home office allowances.

But people aren’t focusing on these things. They are targeting the major examples, such as politicians, instead.

Conclusion

It’s true that hiding cash has become a crummy business. Increased transparency and the increasing media scrutiny of these mechanisms have changed the way people look at finance. This is a trend that is not going to abate in the coming years.
What are your opinions on hiding cash?