Zero income tax

[lambrini_socialist]

It's my target to pay zero Corp Tax

call me stupid, but how on earth?

[nevergoingtopay]

call me stupid, but how on earth?

He is going to pay it all as PAYE so will end up paying zero corp tax.

See easy I should be an accountant!

[Nick44]

if it looks too good to be true..........

[xoggoth]

You do get some wierd stuff. Someone I know claims 80p a mile on his Mercedes. Insists his accountant says it's ok.

[Platypus]

Contractor in my team: "I use a scheme that means I don't have to pay any income tax and I get to keep 82% of my rate."
Me: "You're asking for trouble"
Him: "No, my accountant says that its legal"

Someone told me similar recently and said it was through Giant's umbrella. Also told me it was legal and said he didn't claim £8 per day lunch allowance or other doubtful expenses. As the conversation bumbled along it became clear to me he had no idea how the scheme worked nor had he checked if his "take home" was in fact 82% of his gross billable. In the end I doubted his claim - he was persuaded to join the scheme on a headline of "upto 82%" and assumed that's what he got.

I was stunned how someone could have so little idea how their scheme worked or what they got paid. It takes all sorts I suppose.

[moorfield]

I was stunned how someone could have so little idea how their scheme worked or what they got paid. It takes all sorts I suppose.

WHS / +1

Times like this (benched) I'm glad I do my own bookkeeping and don't rely solely on the number bods - I know exactly how much retained profit I have - and therefore a good idea of how long I can survive. (At the moment it's looking like a looong time, but that's another story.)

[Fred Bloggs]

You can pay zero tax legally in the UK. You pay yourself below the NI/income tax threshold then you put the rest of the ltd co income into a SIPP. Providing you are >50 years of age, you then pull 25% out of the SIPP as a tax free lump sum.

Simple.

[tim123]

You can pay zero tax legally in the UK. You pay yourself below the NI/income tax threshold then you put the rest of the ltd co income into a SIPP. Providing you are >50 years of age, you then pull 25% out of the SIPP as a tax free lump sum.

Which still leaves 50% of your income in a fund that you can never spend

tim

[Fred Bloggs]

Which still leaves 50% of your income in a fund that you can never spend

tim

But the thread was about paying zero tax.........

You can take income from the fund though (say from income unit trusts for example) and by the time you retire, you've probably pulled out more income over the years to retirement than the original lump sum that went into the fund in the first place.

[LisaContractorUmbrella]

All umbrella companies pay in exactly the same way - through PAYE and the only difference between any of them should be the fees that they charge. Any company that advertises that they can guarantee you a level of take home pay of 80%+, without knowing your circumstances, is, shall we say, being somewhat economical with the truth.

It is true to say that the higher your expenses are, the lower your tax liability will be BUT you cannot claim for expenses you have not incurred regardless of your umbrella company's adverts or dispensations or promises that HMR&C will knock on their door and not yours.

If you have a regular 9 to 5 contract you cannot claim for breakfast, lunch and dinner expenses. If you spend £4 per day on food, you cannot claim £30 per day whatever you may have been told. This would mean you would be receiving a tax benefit on £26 per day or £130 per week - this equates to HMR&C giving you money just to go to work - let's face it, it's not really likely is it