Anyone ever used a company called Darwin using an offshore trust

[LisaContractorUmbrella]

You will not get a straight answer to that question!

It does seem to have gone awfully quiet doesn't it
(Any excuse for the new smiley)

[malvolio]

"...from LisaContractorUmbrella

Any of these 'schemes' (and there are hundreds of them) will, at best, defer the tax that you owe. If you live and work in the UK you are liable for UK taxes - if you are outside IR35 set up a limited company and you will then be able to draw dividends from the company. If you are inside IR35 you absolutely must, no alternatives, no exceptions, be paid through PAYE whether through a limited company or an umbrella

..."
.
.
.
Are you a Chartered Tax Adviser, Tax Specialist or member of a Professional Group? Please elucidate?

The post above "If you live and work in the UK you are liable for UK taxes" is wholly inaccurate and does not consider other matters such as Residency & Domicility etc. Such knee jerk reactions appear as fact when they really are opinions of an individual without all the relevant knowledge?

Registered Tax Avoidance Schemes are legal (following correct due process). There is no 1 size fits all so "Any of these 'schemes' (and there are hundreds of them) will, at best, defer the tax that you owe" is just not true.

I do hope that your inaccurate opinion is not merely exaggerated by your conflict of interest as the Managing Partner of an Umbrella Company.

Surely posting inaccurate information on behalf of your business will surely unravel any positives as being an 'expert' in the field and offering prospective clients impartial and accurate advice?

The best advice should be "ask an expert"....

Actually our best advice is always "Ask an expert". Usually tempered with "If you have to ask an expert, it might not be a good idea in the first place".

If you want to promote a given scheme or explain why and how they can be applicable to Mr Smith of Acacia Road, then feel free to do so. We've asked several "experts" to do that and so far not one has had the guts to give a reply. We have had quite a bit about "It's difficult to explain" or "Give me a call and I'll go through it" or the always popular "We have QC's opinion", but no straight answers. Which, oddly enough, makes many of us experienced guys just a little suspicious: especially given the flurry of challenges coming out of HMRC's newly reconstituted Soak the Rich team.

And FWIW Lisa's been giving accurate and supportable advice on here for several years.

Unlike you.

HTH

[cojak]

[I]"...from LisaContractorUmbrella


The post above "If you live and work in the UK you are liable for UK taxes" is wholly inaccurate and does not consider other matters such as Residency & Domicility etc. Such knee jerk reactions appear as fact when they really are opinions of an individual without all the relevant knowledge?

.......

The best advice should be "ask an expert"....

Best advice maybe to ask a travel agent too...

He's probably too busy supplying tissues to clients who are running around like headless chickens at the moment...

[Fred Bloggs]

It does seem to have gone awfully quiet doesn't it
(Any excuse for the new smiley)

[CharteredTaxAdviser]

Fact or Fiction

I'll try and pick up some of your points....

Firstly Lisa - you now ask a different question!. When you now ask me "for a UK resident" then you've supplied MORE information than your first statement. That EXACTLY proves my point in my last post!.

The situation for a UK Resident working in the UK is totally different to a Non-Dom or someone on a working Visa, for example HSMP? You mentioned none of this in your first statement which is why I replied, your knee jerk reaction with a wide sweeping statement just does no good.

It makes your comment too general and therefore wrong!

To tackle the further points - if someone has a SPECIFIC question I'll do my best. The truth is that I can only comment on a SPECIFIC Scheme where I know all the details.

I stand by my statements. Tax Avoidance is not illegal. You have to accept that. It is more prevalent than most people realise and more complicated than most realise, its here to stay and in fact will likely increase with impending 50% IT rates for over £150k and effective 60% IT rates between £100k and £110k.

You guys don't seem to have REALLY considered where you personally draw YOUR line of acceptability in Tax Mitigation Strategies, you seem to follow Lisa's approach of "its all bad, wrong, illegal whatever". I'll give you an example to prove my point (using general figures plz)

If you are about to take a BONUS payment from your own Ltd Co of £100k, then you'll have to pay 40% Tax (assuming you've already had £37,400 of PAYE salary), 12.8% Employers NI, 11% Employees NI - total tax take 63.8%. If you decide to pay it out as a dividend avoiding the NI contribution - you've legally avoided some Tax!

You have to accept that you've made an informed choice and mitigated your Tax Bill. Then again, you could decide to sell some shares in your Co to someone else and pay Capital Gains Tax at 18% - is that now horrendous Tax Avoidance that you all want to get up in arms about? NO!

If you qualify, then you can utilise Entrepreneurs Relief and pay 10% CGT. Are you now so far down the Tax Avoidance route that you're to be pilloried because you're only paying 10% instead of 63.8% - of course, not. you'll say that you've cleverly utilised the Tax Laws as they are written.

There are various scenarios for UK Residents where items are Taxed at 0%, go look in a Tolley's and hunt them out. A Tax Avoidance Scheme utilising these elements is as allowable as someone deciding to reduce his Tax Burden from 63.8% to 10%! You've just found something that Taxes at 0% instead of 63.8%

You all need to think a little more deeply, research a bit more before making wild claims that "Tax Avoidance is wrong", "if you live in the UK you have to pay PAYE on all your income" etc etc

We are now beginning to see FTSE 100 companies moving offshore now. Shire Pharma was the first FTSE 100 company to move to Jersey and there have been reports that another 6 in the FTSE are looking or have plans. A recent article in the Times explained how there are 400 individuals in the UK that earned over £10m per annum. Of those only 65 paid Tax...

Lisa would not like me to make wide sweeping statements about her industry so I'm saying, be careful of what you say Lisa, you are NOT an expert (I presume so as you didn't answer my question about having any qualifications in Tax or Legal?)

I'll give you an example of me trampling all over your industry...

If I'm a contractor and pay full PAYE on my contract income (with zero expenses) why won't I get EXACTLY the same example payslip from EVERY Umbrella Company in the industry? They should all get the same result, surely. The only difference in that Marketplace is how much Umbrella Co's cheat and lie about the expenses that can be claimed. The only true difference between them all should be the fee...

As I said - seek an expert, as forums are full of 'pretend ones'. At least if you pay me or anyone else a fee - you've got some legal recourse.

And I also apologise to Lisa as this all appears to be a personal attack - unfortunately in this thread its the best example I can find of my point about defamatory statements about an industry touted as fact.

[...
Oh and if you don't mind - can we dispel this ridiculous myth about 'retrospective taxation' by HMRC in the BN66 case. The Government argues that the legislation put in place in 1987 is what is being applied, NOT that FA2008 has some NEW legislation being applied back in time! Again, the internet is awash with statements that "offshore businesses, Trusts, Tax Avoidance and the fact that HMRC can now create laws and apply them back in time" means we're all doomed - utter nonsense...
...]

[malvolio]

Actually most of us understand avoidance pretty clearly. Might be something to do with many of us being directors of limited companies and understanding the legal duties that imposes. Or possibly from having sought expert advice from a range of sources including specialist accountants so we understand the taxation landscape as part of our general IR35 defences. We also know it is not illegal.

That is not the issue here. I for one have never said "Dn't use an offshore", all I've said is "Be aware of the additional risks that entails". Those risks do vary with the scheme in question, of course, but they still exist.

As for

To tackle the further points - if someone has a SPECIFIC question I'll do my best. The truth is that I can only comment on a SPECIFIC Scheme where I know all the details.

That's the same cop-out answer we always get. It's also why PCG, for one, will not give advice beyond "Be careful", since otherwise they would have to get expert opinion on over 100 schemes. But you could pick one you do know about and explain that one. Or at least why it is immune to current and potential future legislation which, as we now know, can be backdated.

And we understand the "restrospection" aspect of BN66 fairly clearly, come to that. That case has ceased to be about retrospection and is in the realms of human rights. Do try and keep up.

[BolshieBastard]

I'll try and pick up some of your points....

Firstly Lisa - you now ask a different question!. When you now ask me "for a UK resident" then you've supplied MORE information than your first statement. That EXACTLY proves my point in my last post!.

The situation for a UK Resident working in the UK is totally different to a Non-Dom or someone on a working Visa, for example HSMP? You mentioned none of this in your first statement which is why I replied, your knee jerk reaction with a wide sweeping statement just does no good.

It makes your comment too general and therefore wrong!

To tackle the further points - if someone has a SPECIFIC question I'll do my best. The truth is that I can only comment on a SPECIFIC Scheme where I know all the details.

I stand by my statements. Tax Avoidance is not illegal. You have to accept that. It is more prevalent than most people realise and more complicated than most realise, its here to stay and in fact will likely increase with impending 50% IT rates for over £150k and effective 60% IT rates between £100k and £110k.

You guys don't seem to have REALLY considered where you personally draw YOUR line of acceptability in Tax Mitigation Strategies, you seem to follow Lisa's approach of "its all bad, wrong, illegal whatever". I'll give you an example to prove my point (using general figures plz)

If you are about to take a BONUS payment from your own Ltd Co of £100k, then you'll have to pay 40% Tax (assuming you've already had £37,400 of PAYE salary), 12.8% Employers NI, 11% Employees NI - total tax take 63.8%. If you decide to pay it out as a dividend avoiding the NI contribution - you've legally avoided some Tax!

You have to accept that you've made an informed choice and mitigated your Tax Bill. Then again, you could decide to sell some shares in your Co to someone else and pay Capital Gains Tax at 18% - is that now horrendous Tax Avoidance that you all want to get up in arms about? NO!

If you qualify, then you can utilise Entrepreneurs Relief and pay 10% CGT. Are you now so far down the Tax Avoidance route that you're to be pilloried because you're only paying 10% instead of 63.8% - of course, not. you'll say that you've cleverly utilised the Tax Laws as they are written.

There are various scenarios for UK Residents where items are Taxed at 0%, go look in a Tolley's and hunt them out. A Tax Avoidance Scheme utilising these elements is as allowable as someone deciding to reduce his Tax Burden from 63.8% to 10%! You've just found something that Taxes at 0% instead of 63.8%

You all need to think a little more deeply, research a bit more before making wild claims that "Tax Avoidance is wrong", "if you live in the UK you have to pay PAYE on all your income" etc etc

We are now beginning to see FTSE 100 companies moving offshore now. Shire Pharma was the first FTSE 100 company to move to Jersey and there have been reports that another 6 in the FTSE are looking or have plans. A recent article in the Times explained how there are 400 individuals in the UK that earned over £10m per annum. Of those only 65 paid Tax...

Lisa would not like me to make wide sweeping statements about her industry so I'm saying, be careful of what you say Lisa, you are NOT an expert (I presume so as you didn't answer my question about having any qualifications in Tax or Legal?)

I'll give you an example of me trampling all over your industry...

If I'm a contractor and pay full PAYE on my contract income (with zero expenses) why won't I get EXACTLY the same example payslip from EVERY Umbrella Company in the industry? They should all get the same result, surely. The only difference in that Marketplace is how much Umbrella Co's cheat and lie about the expenses that can be claimed. The only true difference between them all should be the fee...

As I said - seek an expert, as forums are full of 'pretend ones'. At least if you pay me or anyone else a fee - you've got some legal recourse.

And I also apologise to Lisa as this all appears to be a personal attack - unfortunately in this thread its the best example I can find of my point about defamatory statements about an industry touted as fact.

[...
Oh and if you don't mind - can we dispel this ridiculous myth about 'retrospective taxation' by HMRC in the BN66 case. The Government argues that the legislation put in place in 1987 is what is being applied, NOT that FA2008 has some NEW legislation being applied back in time! Again, the internet is awash with statements that "offshore businesses, Trusts, Tax Avoidance and the fact that HMRC can now create laws and apply them back in time" means we're all doomed - utter nonsense...
...]

Weird!! After reading all that, I was certain it was written by someone who knew what they were talking about. Then, that last para made me think the writer is either AtW or more likely Incognito!

[Fred Bloggs]

Our new friend seems to have overlooked the fact that anyone who is taxed on income in the UK has an upper limit to the amount of National Insurance they have to pay at 11% above which you pay 1% on all additional earnings.

National Insurance Rates.

[TykeMerc]

Our new friend seems to have overlooked the fact that anyone who is taxed on income in the UK has an upper limit to the amount of National Insurance they have to pay at 11% above which you pay 1% on all additional earnings.

National Insurance Rates.

Which a "CharteredTaxAdviser" (normally advisor in the UK) really should understand.

Yet another feeble troll I'm afraid.

Like Mal my view on offshore payment schemes for someone living and working in the UK is that they're very risky and stand a very strong chance of being knobbled in the long run by HMRC with loads of back tax, insurance and possibly punitive penalties to pay.

Tax avoidance is perfectly moral and reasonable until the measures used dance so close to evasion.

[bananarepublic]

[...
Oh and if you don't mind - can we dispel this ridiculous myth about 'retrospective taxation' by HMRC in the BN66 case. The Government argues that the legislation put in place in 1987 is what is being applied, NOT that FA2008 has some NEW legislation being applied back in time! Again, the internet is awash with statements that "offshore businesses, Trusts, Tax Avoidance and the fact that HMRC can now create laws and apply them back in time" means we're all doomed - utter nonsense...
...]

Sounds like this thread is going off topic and you are trying to drum up business....

Can't see how you can claim that BN66 isn't retrospective taxation. Without the "clarification" of BN66 and the subsequent FA I don't believe HMRC would have challenged the scheme. Why? Because they thought they would lose. They had to rely on a change which "always" had affect to make the challenge. Perhaps my grasp of the English Language isn't very good but isn't that retrospection? [ There is plenty of info in the BN66 threads about the timelines of all this ... ]

It appears that the "retrospection" is catching, wasn't there an announcement last week about a loophole for foreign manufactured dividends being closed "retrospectively"?

BTW Your example regarding NI and 63.8% tax is wrong, more like (40+1+12.8)/(100+12.8) = 47.7% marginal rate. (Admittedly going up soon - April 2011 to 66.6%! for someone on 100K)