. . Germany - the taxman cometh

[poppy01]

Haha.

Boomed!!

It's totally your own fault - trying to evade taxes.. Tough luck mate..


NOT!!!

Sorry man you are out of order. Many people are caught up in this who entered into arrangements in good faith with seemingly reputable agencies being told that it was what everyone did and they would be fools to do otherwise. Also as I understand it, it was more of a scheme to pay some of the taxes under a more amenable jurisdiction (unbelievably the UK in this case). So.. an AVOIDANCE scheme (which benefited the UK treasury), but not premeditated evasion, (yes.. there is a difference)

[BlasterBates]

Actually that isn´t true, the money was siphoned off to various countries, Switerland, Cyprus etc with secret bank accounts. UK management co´s have been doing this for years. They´re still offering it. I knew one contractor that got caught on this several years ago. There was a raid on a Swiss bank about 4 years ago.

My argument is contractors are being conned, and still conned into "tax avoidance" schemes. They´re not tax avoidance they´re blatant tax evasion, with plausible deniability.

[poppy01]

Actually that isn´t true, the money was siphoned off to various countries, Switerland, Cyprus etc with secret bank accounts. UK management co´s have been doing this for years. They´re still offering it. I knew one contractor that got caught on this several years ago. There was a raid on a Swiss bank about 4 years ago.

My argument is contractors are being conned, and still conned into "tax avoidance" schemes. They´re not tax avoidance they´re blatant tax evasion, with plausible deniability.

A 'friend' was in such a scheme for 10 months. A percentage of the money went to an off-shore investment fund. This could not be touched while in Germany. On de-registering, the following year , He was able to take this as a dividend payment which he declared and paid tax on the in the UK. The UK treasury was about 5k better off. The finanzamt about 10k worse off. This is how he did it and how he was told it worked.

He never understood it to be evasion, but a tax planning arrangement that was perfectly legal. He may have been misguided in this but as I said he took it at face value.

[LonelyRider]

Thanks Poppy for your support.

I have been blaming myself for being stupid and naive. Even more I have been blaming my MC and Mr H. I would say I was conned into the scheme and even worse, I was conned to stay in it, when getting out as soon as I had doubts and correcting the recent mistakes myself would have been the best option.

I have only shared what happened to me here, as I now have the impression all Mr H's clients will have to face something similar and it would probably a good idea to settle the matter oneself asap instead of waiting. Based on the information I got from the authorities, it is already too late for many.

[BlasterBates]

Thanks Poppy for your support.

I have been blaming myself for being stupid and naive. Even more I have been blaming my MC and Mr H. I would say I was conned into the scheme and even worse, I was conned to stay in it, when getting out as soon as I had doubts and correcting the recent mistakes myself would have been the best option.

I have only shared what happened to me here, as I now have the impression all Mr H's clients will have to face something similar and it would probably a good idea to settle the matter oneself asap instead of waiting. Based on the information I got from the authorities, it is already too late for many.

...well done for pointing out, as you´ve said you´re being conned. At least the authorities allow you to redeclare your income if you do it, before you have a personal visit. It is in no way legally defensible.

Unfortunately as we discuss this new contractors are entering to similar schemes run by the same managment co´s.

There is a general rule in any European country. If you earn money on service provided, you must tax it there. All the double taxation treaties are abundantly clear on this, and I´ve read them very carefully.

These management co´s transfer money around, and their argument is, it isn´t yours, and they make the paper trail difficult to fathom out. As soon as the tax authorities can prove this link they´ll get the tax.

[poppy01]

...well done for pointing out, as you´ve said you´re being conned. At least the authorities allow you to redeclare your income if you do it, before you have a personal visit. It is in no way legally defensible.

Unfortunately as we discuss this new contractors are entering to similar schemes run by the same managment co´s.

There is a general rule in any European country. If you earn money on service provided, you must tax it there. All the double taxation treaties are abundantly clear on this, and I´ve read them very carefully.

These management co´s transfer money around, and their argument is, it isn´t yours, and they make the paper trail difficult to fathom out. As soon as the tax authorities can prove this link they´ll get the tax.

Is that entirely true. I thought you could use your uk limited for 6 months before registering?

Anyhow the authorities should shut these MC's down, everyone working thru them is indeed being conned. There is still a chance you might get away with it but really it isnt worth it. Just register and pay up as my friend wishes he had.

[BlasterBates]

Is that entirely true. I thought you could use your uk limited for 6 months before registering?

Anyhow the authorities should shut these MC's down, everyone working thru them is indeed being conned. There is still a chance you might get away with it but really it isnt worth it. Just register and pay up as my friend wishes he had.

You can work as an employee of your own company for up to 6 months and that income is taxed in the UK.

With regards to your business i.e. tax directly on your UK company that requires clarification from an accountant, as to whether you pay VAT etc.

So it is indeed true that if you leave within 6 months probably you don´t need to pay any tax.

[krankyd]

Sorry man you are out of order. Many people are caught up in this who entered into arrangements in good faith with seemingly reputable agencies being told that it was what everyone did and they would be fools to do otherwise. Also as I understand it, it was more of a scheme to pay some of the taxes under a more amenable jurisdiction (unbelievably the UK in this case). So.. an AVOIDANCE scheme (which benefited the UK treasury), but not premeditated evasion, (yes.. there is a difference)

It' not out of order - 'I didn't know' is no defense. Try this when getting HMRC over for a cup of tea to discuss anything.. I doubt that people who entered into these schemes would be willing to pay any money to any local government - which is entirely the point of how they work.

Anyone with an ounce of knowledge is aware these schemes are devised to just do one thing - avoid paying tax on a bulk of your salary. Then fly home, get out and bang it's gone. it's TAX Evasion, pure and simple. If you've done this and not been caught, well that's your choice. Get busted by the tax man and you'll be taking german tax salami up the Rhine before you know it..

Tough. You pay/don't pay and take your choice. Simple.

[poppy01]

It' not out of order - 'I didn't know' is no defense. Try this when getting HMRC over for a cup of tea to discuss anything.. I doubt that people who entered into these schemes would be willing to pay any money to any local government - which is entirely the point of how they work.

Anyone with an ounce of knowledge is aware these schemes are devised to just do one thing - avoid paying tax on a bulk of your salary. Then fly home, get out and bang it's gone. it's TAX Evasion, pure and simple. If you've done this and not been caught, well that's your choice. Get busted by the tax man and you'll be taking german tax salami up the Rhine before you know it..

Tough. You pay/don't pay and take your choice. Simple.

I understand your point entirely, but its easy to get caught up in it when a) everyone's doing it, b) you are in a foreign country and dont really know how things work, c) you are persuaded it is a tax planning arrangement, not evasion but avoidance (very similar I think to what Barclays Bank does on an industrial scale).

I just dont like this yah boo tough titty attitude some kinds of people relish in.

[dx4100]

Haha.

Boomed!!

It's totally your own fault - trying to evade taxes.. Tough luck mate..


NOT!!!