Anyone ever used a company called Darwin using an offshore trust

[LisaContractorUmbrella]

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.

"Perhaps you could clarify under what circumstances someone who is a resident of the UK and works in the UK would not be liable for tax in the UK?"

How much more specific would you like me to be?

[cojak]

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

Of course he/she is. Our wariness of such schemes means that they are less like to get business off this forum.

The fact that many of us scrutinise our tax liabilities (current and future) and also seek clarification from tax specialists means that they have to try harder here.

They won't get many takers though - we've seen what happens when these schemes go belly up...

[Mozart]

It appears CTA is not trying to drum up business because he has made himself uncontactable but I want him to be my tax accountant :-)

[Fred Bloggs]

Move along now, nothing to see here folks............ Here we have a "chartered tax adviser" who doesn't understand how UK National Insurance deductions work!

[Keith Kershaw]

"Perhaps you could clarify under what circumstances someone who is a resident of the UK and works in the UK would not be liable for tax in the UK?"

One circumstance might be if the individual doesn't receive any remuneration. Key to how the successfully-implemented offshore schemes work is that there is reduced remuneration and therefore reduced taxation. Since the Disguised Remuneration legislation was introduced, it is essential that individuals using the arrangements can pass self-employment tests. These are substantially the same as the IR35 tests: that is, the individual must be in business on his own account. But, so long as he is, there is nothing to stop him reducing his income and thus his taxation. If as a result, he gains access to other funds that he might otherwise have had, then provided those other funds are not remuneration, then he maintains or even increases the funds at his disposal without suffering corresponding tax consequences.

[LisaContractorUmbrella]

One circumstance might be if the individual doesn't receive any remuneration. Key to how the successfully-implemented offshore schemes work is that there is reduced remuneration and therefore reduced taxation. Since the Disguised Remuneration legislation was introduced, it is essential that individuals using the arrangements can pass self-employment tests. These are substantially the same as the IR35 tests: that is, the individual must be in business on his own account. But, so long as he is, there is nothing to stop him reducing his income and thus his taxation. If as a result, he gains access to other funds that he might otherwise have had, then provided those other funds are not remuneration, then he maintains or even increases the funds at his disposal without suffering corresponding tax consequences.

Perhaps you could be slightly more specific about 'other funds'? But I definitely agree with your first assertion, if you don't receive any money, you definitely won't pay any tax

[Fred Bloggs]

I suppose you could say that if it adds up like income, looks like income and is spent like income, then it is income?

[Keith Kershaw]

I suppose you could say that if it adds up like income, looks like income and is spent like income, then it is income?

You could, and you would be right. But so long as it doesn't, then it isn't.

Usually the other funds are loans. It is possible to challenge the loans and say, they're not really loans, they're really income. But a properly implemented arrangement includes features that can withstand such an attack. Broadly, this means commercial terms: refusal to lend to high-risk individuals, the charging of interest, a repayment schedule, actual repayments, and so on.

You might say, well, with a scheme like that, where the money's not yours, there's no guarantee you'll get it and even if you do get it, you have to pay it back, who is going to use it? What's the point?

Ah, well, again, a properly implemented arrangement can deal with that. Repayments do not necessarily need to be made any time soon. It could be, for example, on your 70th birthday or on death. Then, if your repayments are to a trust where the trust will use the repayments of capital for specified purposes, and those purposes are in line with your wishes yet do not themselves give rise to taxation, then you are achieving the desired result. It may be that the assets are applied for the benefit of your children, for example. If you died before this happened, not only would you have avoided income tax, but you would avoid inheritance tax as well.

No doubt each individual should consider the arrangements he is entering into very carefully, but there are certainly operators in the market who do know what they are doing and are capable of saving people large sums of money.

[geoff from contracta IOM]

You could, and you would be right. But so long as it doesn't, then it isn't.

Usually the other funds are loans. It is possible to challenge the loans and say, they're not really loans, they're really income. But a properly implemented arrangement includes features that can withstand such an attack. Broadly, this means commercial terms: refusal to lend to high-risk individuals, the charging of interest, a repayment schedule, actual repayments, and so on.

You might say, well, with a scheme like that, where the money's not yours, there's no guarantee you'll get it and even if you do get it, you have to pay it back, who is going to use it? What's the point?

Ah, well, again, a properly implemented arrangement can deal with that. Repayments do not necessarily need to be made any time soon. It could be, for example, on your 70th birthday or on death. Then, if your repayments are to a trust where the trust will use the repayments of capital for specified purposes, and those purposes are in line with your wishes yet do not themselves give rise to taxation, then you are achieving the desired result. It may be that the assets are applied for the benefit of your children, for example. If you died before this happened, not only would you have avoided income tax, but you would avoid inheritance tax as well.

No doubt each individual should consider the arrangements he is entering into very carefully, but there are certainly operators in the market who do know what they are doing and are capable of saving people large sums of money.

Be careful ! even though you have described a commonly used and legal approach to being tax efficent you will probably still get set upon