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Fraudulent Practices

Astrid Lulling, Rapporteur to the European Parliament's Committee on Women's Rights, 8 January 1997

‘Assisting spouse’ is a little known term. ‘Assisting spouses’ work in family businesses but are unwaged and have no legal status or rights.

“… their role is often perceived, both in law and in general attitudes, as a conjugal duty given free of charge.”

Farmers’ wives are classed as ‘assisting spouses’ who provide free labour to their husbands who would otherwise need to employ a farmworker.

Accountants prepare sole trader accounts for farmers with ‘assisting spouses’. Wives’ names and marital status are added to trading titles to give the appearance of business partnership so that partnership tax returns can be filed at the Inland Revenue. The purpose of ‘assisting spouses’ is to enable sole traders to evade income tax by sharing tax liabilities but not actual profits.  

Women farmers are not ‘assisting spouses’ but, if married to their business partners, are often regarded as such by the male-dominated farming community. They file partnership tax returns, are taxed individually and take their share of the profits.

In the event of divorce, women farmers can be fraudulently misrepresented as ‘assisting spouses’ by changing the format of the accounts from partnership to sole trader with ‘assisting spouse’. Banks act on the fraud and divest them (or facilitate their divestment) as though they are merely ‘assisting spouses’ with no legal status or rights. Thereafter, the dissolution and winding up of their business partnerships is hopelessly prejudiced: family lawyers will manufacture ancillary relief proceedings in the divorce court to block any investigation of the false accounts, the tax fraud and the banks' liabilities. The inevitable outcome is the defamation and dispossession of women farmers and the destruction of their careers.

Robert Blackburn ICPA (ex-ACPA), Accountant, 18 January 2007

In his Amended Defence to his client (a woman farmer)’s claim that his preparation of her accounts fraudulently misrepresented her as an ‘assisting spouse’ instead of a business partner, and resulted in her dispossession:

“The accounts were prepared in the standard accepted manner for a married couple. Where parties are married and share equal profits it is normal to have a joint capital account as it is impossible and impractical to divide drawings.”

Ethical accountants disagree with Robert Blackburn and do divide the profits and drawings, as in all partnership accounts. Why does Robert Blackburn divide the profits on the tax returns but not in the accounts?

“Had the parties not been married the Defendant would have prepared accounts in the manner suggested. The approach to preparing accounts for a married couple applies not only to farms but to any partnership.”

Is Robert Blackburn saying that he regards all business couples as sole traders with ‘assisting spouses’ and none as genuine business partners?

 

 

 

 

 

 

 

 

 

 

 

 

 




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