Tax Law (sometimes also referred to as Taxation Law) is a component of law which deals, quite simply, with taxes. However, this can be subdivided further, and crosses over with a number of other practice areas.
For example, tax law is often split into personal and corporate tax. Lawyers working in areas of personal tax could be advising on how to manage your pension in the most tax-efficient way, for example, while corporate tax advisers could be advising two merging companies on how to minimise the tax burdens of their agreements.
Tax law can also be subdivided into contentious and non-contentious work. Both of the above examples are non-contentious (or ‘advisory’). Contentious work, on the other hand, often goes down the route of disputes or litigation. For example, a company being accused by HMRC (the UK’s tax collector) of underpaying on their taxes will need legal representation.
Another subdivision of the practice area is private vs public work. Private work encompasses much of what has already been discussed here – acting for individuals (‘private client’ work) or organisations (corporate work) as clients. Public work in the tax space could involve working as a lawyer at HMRC or on a government panel, where you are responsible for enforcing tax rules and defending public policy. This is an area which may be particularly interesting to those with political interests.
It is also worth noting that tax law is one of a few practice areas which tend to have experienced advisors located outside of law firms, too. For example, large consulting or accounting firms will often retain a number of tax experts (whether qualified lawyers or not), which opens up a wide variety of contexts which tax lawyers can choose to work in.
Tax law, like many aspects of law, is not always a stand-alone practice area, but instead often gets ‘bolted on’ to other matters going through a law firm. Here are just a few illustrative examples:
UK Tax Law involves a wide variety of legislation. Some key areas that you might choose to engage with include:
Tax is a varied aspect of law which may involve a number of tasks, some of which are common across other practice areas too, including:
The standard routes to qualification apply to become a qualified lawyer in the tax space. If you want to pursue a solicitor role in tax, you’ll need to complete a university degree, law school (the PGDL if converting from a non-law degree, then the LPC or SQE, although the former is soon being phased out), and two years of QWE (qualifying work experience) – for instance, a training contract.
If you want to pursue a barrister role in tax law, you’ll need to take a similar route, but after the PGDL (if necessary) your path branches off through a bar training course, pupillage, and tenancy. However, there are some particular nuances you might want to note if you are particularly interested in tax law.
First, you may be able to select tax as an optional module during your degree or law school, thus developing your knowledge in the area and demonstrating your commitment to a career to future employers.
Second, you might want to consider the strength of the tax department at firms or chambers you are applying to towards the later stages of your path into law. In other words, how well known is this law firm for tax? Does that affect whether I want to apply for a training contract there?
Third, you might even go as far as to consider specialised postgraduate study in law related to tax – for example a Masters in Finance Law (sometimes sponsored by a firm or Chambers during your employment to complete part-time).
Tax lawyers require a number of skills. Many of these are common across numerous areas of law, including excellent academic abilities (for example, needing to scan and interpret large bodies of text and legislation related to tax), strong communication skills (for example, breaking down complex tax requirements into a client-friendly line or two), and teamwork (for example, the need to collaborate with a number of other departments).
However, tax lawyers also often have some more specialist skills which can prove particularly useful. Having a decent foundation in mathematics can be useful, as can some knowledge of accountancy, since tax is often more of a quantitative area of law than others practice areas.
The Patents branch of IP (Intellectual property) is another area where more STEM-based, analytical lawyers are known to flourish. This is not to say that you need to have a maths degree or specialist knowledge to be a tax lawyer – but simply that having an analytical approach to the law may be an extra advantage in applying to such roles.
Tax is often regarded as one of the best practice areas for work-life balance, something which many lawyers (especially at the top level) struggle with massively.
Of course, this will also depend a lot on which type of law firm you are working at, since private client tax advice at high-street law firms is generally less demanding hours-wise than tax advice within a huge merger at a Magic Circle firm, where associates are expected to pull all-nighters.
On the whole, however, tax does seem to have maintained a positive reputation in this sense across the board.
Tax lawyers are certainly some of the best-paid in the business, too. For solicitors at major Magic Circle or elite US law firms, tax lawyers are bringing in well over £100,000 at the NQ level and fare equally well as barristers. Tax lawyers are also highly in demand for in-house roles, and so can afford to play the field for salaries across different organisations as well.
A number of law firms have become well-respected for having particularly strong tax practice areas. The Chambers rankings are a decent place to start in assessing the strength of firms in the tax space. Here are a few examples:
Tax law is an area of practice which is constantly changing with the world around us. Growing concerns over the environment is one example. While many companies want to engage with ESG in the modern world, they also want to remain profitable. One way of negotiating this dilemma can be found in the government offering tax breaks to companies which reach certain targets. Conversely, taxes can be imposed even more heavily on companies who score badly on certain metrics (e.g. carbon emissions taxes). Experienced lawyers are certainly needed in this area.
The UK’s departure from the EU is another development which has had a significant impact on tax law. Companies are now keener than ever to streamline their operations in countries which are seen as more tax-efficient. The UK attempted to slash taxes heavily under Kwasi Kwarteng and Liz Truss, but a vehement market backlash led to a reversal of this decision. Clearly the impact of tax is affecting the world as a whole in significant ways.
Tax law is an exciting, dynamic and constantly evolving area of legal practice which is sure to attract a range of aspiring lawyers with its varied work (interacting with a range of practice areas and incorporating both contentious and non-contentious work), relatively decent work-life balance and high salaries.
Candidates need to demonstrate a range of skills (in particular on an analytical and quantitative level), and should target their applications to employers based on their strength in this area. The future of this practice area, with its strong ties to real-world developments, offers excellent opportunities for aspiring lawyers to develop their own careers.
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