using an offshore company ?

[2uk]

Is it legal to use an offshore company ? From what i read the pitfall is that clients might look with bad eye on you.
But then if it was that simple , everybody would be doing it right ?

[BrilloPad]

I use an offshore company. But they have an onshore limited arm. No agency/client will deal with an offshore company as HMRC scare them off.

[tim123]

Is it legal to use an offshore company ? From what i read the pitfall is that clients might look with bad eye on you.
But then if it was that simple , everybody would be doing it right ?

It's perfectly legal. What is not legal is not declaring the income from it on your tax return and paying the same tax as you would have done if you weren't using the offshore company.

Now, what was your business reason for using the offshore company?

tim

[2uk]

It's perfectly legal. What is not legal is not declaring the income from it on your tax return and paying the same tax as you would have done if you weren't using the offshore company.

Now, what was your business reason for using the offshore company?

tim

Are you sayng that although a business is registered offshore , as long as it operates in the UK , you HAVE to pay taxes in the UK ( aswell as what u are paying in the country where the company is registered ?

My reason for using offshore , of course, is so that i am taxed offshore and not in the UK where i operate !

[tim123]

Are you sayng that although a business is registered offshore , as long as it operates in the UK , you HAVE to pay taxes in the UK ( aswell as what u are paying in the country where the company is registered ?

My reason for using offshore , of course, is so that i am taxed offshore and not in the UK where i operate !

It doesn't matter where the business is registered. What matters is where the taxpayer resides.

If you are UK domicilied and resident you are taxed in the Uk on your worldwide earnings.

HTH

tim

[Fishface]

I have a UK Ltd company.

I live in the UK for only 3 months a year.

The contracts I get are in China/Japan/Korea.

Could I offshore my Ltd silently - without the bank or the client knowing?

[2uk]

It doesn't matter where the business is registered. What matters is where the taxpayer resides.

If you are UK domicilied and resident you are taxed in the Uk on your worldwide earnings.

HTH

tim

Well I take comment sparingly. I am inclined to belive that this is true for contractors , but i can argue if its true for insuarance / investing businesses.

[tim123]

Well I take comment sparingly. I am inclined to belive that this is true for contractors , but i can argue if its true for insuarance / investing businesses.

No, it's true for everbody.

Whether the company can be forced to pay out its earning to its owners is another matter. But if it does do this, it is the residence status of the recipient, not that of the company, which determines the tax due.

[Ivor1]

I know of a couple of off-shore schemes that the rev have just started to investigate, users of scheme started to recieve letters this week. Also alot of agencies wont deal with them now, due to the fact they want to change the law in April 07 so anyone in the chain can be chased for the debt including the agency.

Bottom line is you only have two options now PAYE or LTD

[Spartacus]

Don't do it, 2uk. If you are caught out not declaring off-shore earnings when resident in the UK, there is potential for jail time if the amount is large or you have done it for long enough. In any case, as others have pointed out, most agents won't touch someone working through an off-shore company in any case.