Contracts to Defraud the Revenue Flashcards
(4 cards)
1
Q
Contracts to Defraud the Revenue - Case Law
A
- Contracts designed to defraud the Revenue are illegal at common law
- Tomlinson v. Dick Evans [1978]: Statutory rights only under a legal contract.
- Lewis v. Squash Ireland [1983]: Same finding in Ireland
- Walsh v. Walsh (No.1) [2017]
2
Q
Tomlinson v. Dick Evans [1978]
A
- An employee received a pay rise partly as “expenses” to avoid income tax, with both the employee and employer knowing and participating in the scheme
- When the employee brought unfair dismissal proceedings, her claim was dismissed.
- Held: statutory rights do not arise from an illegal employment contract.
3
Q
Lewis v. Squash Ireland [1983]
A
- The Irish Employment Appeals Tribunal found that a contract where part of the salary was falsely described as “expenses” to reduce the employer’s tax liability was illegal.
- Held: An employee’s statutory rights under legislation like the Unfair Dismissals Act are dependent on a legal and enforceable contract of employment.
4
Q
Walsh v. Walsh (No.1) [2017]
A
- The case involved a winning ticket for a €3.4 million jackpot. The defendant and several family members signed the back of the ticket.
- The defendant subsequently claimed to be the sole winner of the jackpot, and that other signatories were added only to avoid tax on any gifts she might make to them.
- Held: Even if the signing of the ticket did express an intention for the win to benefit family members, it would be contrary to public policy to give effect to an agreement undermining statutory tax policy based on an incorrect representation.
