Sanzar Partnership? New IOM company

[THEPUMA]

The problem with them is that they might work, they might not, but do you really want to be in this position: http://forums.contractoruk.com/accou...as-victim.html

True but some gambles don't pay off. It doesn't make it a bad gamble in the first place.

If he had followed Friendly Accountant's advice and used a reputable company, he probably wouldn't have found himself in this position.

[Lewis]

True but some gambles don't pay off. It doesn't make it a bad gamble in the first place.

If he had followed Friendly Accountant's advice and used a reputable company, he probably wouldn't have found himself in this position.

I agree absolutely.
I wonder however how you can know who is a 'reputable' company?

[THEPUMA]

I agree absolutely.
I wonder however how you can know who is a 'reputable' company?

It's difficult but I understand that Montpelier have over 3,000 contractors on the scheme. Whilst this doesn't make them reputable, it gives them a bloody big incentive to fight the case all the way.

I would probably ask for evidence of how far they have defended other products, although this could be a double-edged sword as ideally you'd like to use someone whose products were so good, they'd never got as far as a courtroom!

[Bradley]

What did the Romans ever do for us ...

That's harsh. I think Friendly Accountants's analysis was spot on. What makes you such an expert anyway?

What about the change to the EBT legislation? I'm sure that was in the last 10 years and that affected offshore schemes.

Of course offshore schemes are a gamble and it's important for anyone entering into one to appreciate the risk they are undertaking. It's very easy to criticise them and a lot of people on here who don't understand them do criticise them unfairly.

Ultimately you are gambling on whether the courts will follow the interpretation of the scheme provider and in some cases they will. That is assuming HMRC take them to court which is not a certainty either because the scheme is robust or because it isn't economically worthwhile to do so.

You're right, it was a bit harsh - sorry! Too much coffee this morning.

The morality issue aside, what gets my goat is that when you do talk to the people promoting these things they all are quite happy to take your money whether or not these things work. If they were really serious they would make it on a no-win/no-fee basis and only charge for the time they actually spend doing something. After all, they're not exactly inventing something from scratch. Usually its a cut and paste job.

People are getting ripped off and do end up worse off. If you're one of the high street banks you can probably afford to take the interest and the penalties on the chin but not if its your livelihood.

[BrilloPad]

It's difficult but I understand that Montpelier have over 3,000 contractors on the scheme. Whilst this doesn't make them reputable, it gives them a bloody big incentive to fight the case all the way.

I would probably ask for evidence of how far they have defended other products, although this could be a double-edged sword as ideally you'd like to use someone whose products were so good, they'd never got as far as a courtroom!

If it was that good - the Inlasnd Revenue would close the scheme.

[BrilloPad]

If it was that good - the Inlasnd Revenue would close the scheme.

Actually that is probably not true - HMRC will just use bully boy tactics against infringers.

There is a good reason for this - but I dont want to put it on public forum.

[THEPUMA]

You're right, it was a bit harsh - sorry! Too much coffee this morning.

The morality issue aside, what gets my goat is that when you do talk to the people promoting these things they all are quite happy to take your money whether or not these things work. If they were really serious they would make it on a no-win/no-fee basis and only charge for the time they actually spend doing something. After all, they're not exactly inventing something from scratch. Usually its a cut and paste job.

People are getting ripped off and do end up worse off. If you're one of the high street banks you can probably afford to take the interest and the penalties on the chin but not if its your livelihood.

I think there is a contingent element to the Montpelier fee.

[malvolio]

There's only one thing bothers me about all this. If you are tax resident in the UK, how do you not pay UK tax on foreign earnings, less any tax paid overseas - which in the IOM will be not very much... That's what the scheme providers consistently fail to explain.

It's like jumping off a clliff. The fall won't kill you, it might even be fairly exhilarating: it's stopping at the bottom that hurts.

[THEPUMA]

There's only one thing bothers me about all this. If you are tax resident in the UK, how do you not pay UK tax on foreign earnings, less any tax paid overseas - which in the IOM will be not very much... That's what the scheme providers consistently fail to explain.

It's like jumping off a clliff. The fall won't kill you, it might even be fairly exhilarating: it's stopping at the bottom that hurts.

As I said earlier, people who don't understand the scheme criticise it unfairly.

The generic rules on double tax relief are superseded by double tax treaties which, in the case of the Isle of Man UK double tax treaty on trust income state that if you have paid tax in the IOM, no further tax is due in the UK.

If the scheme were that seriously flawed, I don't think it would have taken HMRC 5 years to fail to get a case to court!

[BrilloPad]

There's only one thing bothers me about all this. If you are tax resident in the UK, how do you not pay UK tax on foreign earnings, less any tax paid overseas - which in the IOM will be not very much... That's what the scheme providers consistently fail to explain.

It's like jumping off a clliff. The fall won't kill you, it might even be fairly exhilarating: it's stopping at the bottom that hurts.

I cant remember the exact wording on tax form - but it is basically IOM trust earnings I think? There is some sort of treaty?

As Friendly Contractor said, there are probably only a few people in the UK who can decide if it is legal or not. And I am certainly not one of them!