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Income Shifting Consultation Document
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Originally posted by Lewis View Post
If it wasn't so dangerous, it would be hilarious. Read it and weep at the ineptness of our current GovernmentBlog? What blog...? -
It says
Within the legislation there are several conditions, all of which must be met for the legislation to apply. In summary:
• Condition A – individual 1 is party to, or has power over the relevant arrangements;
• Condition B – individual 1 forgoes income and the forgone income is individual 2’s for the relevant tax year;
• Condition C – individual 1 has the power to control the amount that is shifted; and
• Condition D – the shifted income consists of distributions of a company or profits of a partnership.
The term “power to control or influence” is not defined and is intended to be interpreted in its widest sense.Comment
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so what is the best strategy, is it to declare and pay dividends before
5th April 2008, and continue operating as normal until a test case
further clarifies this, or is it better to start a new company from 6th April 2008
as a sole shareholder?
What would be the penalties apart from paying the extra tax from getting
caught?Comment
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Originally posted by Bright Spark View Postso what is the best strategy, is it to declare and pay dividends before
5th April 2008, and continue operating as normal until a test case
further clarifies this, or is it better to start a new company from 6th April 2008
as a sole shareholder?
What would be the penalties apart from paying the extra tax from getting
caught?
No idea about penalties.
It seems to me (and I have only skimmed this document and am no expert) that if the wife does some work (e.g. admin) and is paid a salary she may be able to get some albeit small dividend to reflect her involvement. So maybe share splits will move from 50:50 to 10:90 - just guessing here.Comment
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Mal - can you help bring the full force of the PCG onto this? They are even using the word 'fair' again...
P.S. I am a member and have been for ages.
Rule #76: No excuses. Play like a champion.Comment
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would forming separate companies work?
1 for contractor and 1 for admin.
admin co has an ir35 friendly contract to provide services to contractor ltd. lots of IT contractors get paid well for not alot so why can't an admin contractor.Comment
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Originally posted by Xenophon View PostMal - can you help bring the full force of the PCG onto this? They are even using the word 'fair' again...
P.S. I am a member and have been for ages.
You might also visit the main PCG Website - for example, http://www.pcg.org.uk/cms/index.php?...=3275&Itemid=1Blog? What blog...?Comment
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Oh Dear ™
As this is a consultation document I expect we will have to wait to see the legislation before any real holes become apparent.How fortunate for governments that the people they administer don't thinkComment
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Originally posted by Troll View PostOh Dear ™
As this is a consultation document I expect we will have to wait to see the legislation before any real holes become apparent.
However, if you work through the timelines on this one, they have issued it at the last possible moment to meet the 90 day requirment for consultation, and have left effectively no time to discuss and effect any other ideas. Hence PCG and others are adamant that this should not form part of the April 2008 Finance Act since it is a blatant attempt to subvert the Arctic judgement to address an issue that doesn't actually exist (that it is 'unfair' that couples who own a business might jointly prosper from that business when non-couples may not) and that is is drafted in such a way that it cannot be applied, fairly administered or tried in a court of law.
That, incidentally, is a good example of why I push the PCG. Depsite some people's perceptions, it's nothing to do with market share in respect of insurances and IR35, it's all about having the power, authority and presence to represent individuals who would otherwise have no voice.Blog? What blog...?Comment
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