The scrutiny test
The planner should ask whether the plan will withstand scrutiny. If it relies upon non-disclosure, then the plan is unlikely to meet even the legality test, let alone be morally defensible. If the plan is legal, but if revealed would be judged harshly in the Sunday papers, then the plan may be of questionable morality.
The substance test
A plan without substance will be subject to criticism. The “substance over form” tests utilised by the Court to cut down on tax avoidance often go to the question whether the transactions described had commercial substance. To establish a plan which is not aligned with the underlying commercial reality is to take a commercial risk, whether or not it is immoral.
The hypocrisy test
Planning should not be manifestly hypocritical. A plan which claims the benefits accorded to citizens who make charitable donations, when as a matter of commercial reality there is no underlying charitable donation is likely to be regarded as a particularly ugly theft. The legislature has granted incentives to encourage morally admirable actions. Abuse will invoke censure from others which will carry with it its own consequences, both social and financial.
It is appropriate and proper in all areas of life to expect individuals to take into account moral as well as legal considerations. This obligation does not stop at the practitioner’s office door when a client is willing to pay a fee.