If you are a lawyer then you know the importance of a good legal mind. Law is full of twists and turns, you will need to know many legal concepts in order to foresee and prevent any undesirable outcome. But this is the essence of legal work, one can never predict the future, laws are there to help people push forward and not hinder their way. But how do you find out about legal loopholes and get hold of a legal knowledge to exploit them?
A legal loophole is defined as a voidable, unclear or ill-defined part of a law or legal text, which is able to be exploited by the lawyers in order to get around its purpose without technically breaking the law, although technically the intention of the law is to make such loophole illegal. There are several legal problems like these which may arise in the course of practice of law, they will always be present unless there is a universal change in the culture of law, which is unlikely. The only way to get around such issues is to get hold of a legal knowledge to guide you through the hurdles. Loophole is a legal term, therefore, one must always be careful in choosing their words. “Law” and “loopholes” are two different things.
A legal loophole could be explained as something that appears superficially legal, but which is actually illegal, i.e. “a man should not be able to kill his own wife”, this law will be applicable only when the killing of the wife takes place in domestic violence, in other words it will be illegal to kill a spouse just because you want to be legal. Another example is a woman should not be able to sue a man for rape, even if she is married. This law will not apply to all women, if the act committed was rape.
Taxation law is another area which has several legal terms. Taxation law refers to the rules which govern the implementation of taxes and the collection of income taxes by the government. A tax loophole refers to a legal technicality that allows some people or business entities to take advantage of the system and pay less income tax than they are legally required to pay. Several small businesses have found this very convenient. One can save a lot of money in the process of tax preparation and thus benefit from the tax law.
There are several types of legal loophole and some of them have been highlighted below. A tax regime that offers exceptions to large companies is called a subsidies scheme. This scheme has been used by several US companies to save on tax. This has also led to several multinational companies earning billions of dollars in profit every year.
Another type of legal loophole is related to the execution of laws. For instance, there is a tax regime which states that a particular person cannot be taxed for the death of his associate. Such a tax loophole has been used by a number of US multinational companies. They have saved a lot of money on taxes by this means. Such legal loopholes have allowed several US companies to pay a much smaller amount of taxes.