With the new general Tax Avoidance rules effectively closing down these schemes as of Dec 9th, are we going to see a rush of new Ltd companies, or are you awaiting your scheme provider to come up with the "next big thing" in tax avoidance?
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
All you people with EBT/Loan/Dodgy Umbrella schemes - what you gonna do?
Collapse
X
-
-
Originally posted by ChimpMaster View PostWith the new general Tax Avoidance rules effectively closing down these schemes as of Dec 9th, are we going to see a rush of new Ltd companies, or are you awaiting your scheme provider to come up with the "next big thing" in tax avoidance?
Operating a Personal Service Company prior to IR35 meant paying a reasonable/"fair" amount of tax for the risks being taken. IR35 was a direct, unreasonable and unilateral assault on that premise.
Being asked to pay more tax under IR35 than under PAYE people naturally looked for alternatives. The alternatives found were more aggressive in the form of DTA schemes, but above all else they were legal. Those got closed in 2008 and the hard core moved to loan schemes of one shade or another, again all legal (at least until HMRC test them and prove otherwise).
IR35 was a disproportionate response to something that wasn't even a real problem. The Govt only has itself to blame for what has happened since.
What will I do next? I will properly assess all the different options, including moving abroad if necessary.Join the No To Retro Tax Campaign Now
"Tax evasion is easy: it involves breaking the law. By tax avoidance OECD means unacceptable avoidance ... This can be contrasted with acceptable tax planning. What is critical is transparency" - Donald Johnston, Secretary-General, OECD -
I'm not affected by this but I guess many folks will go abroad resulting in even more loss to the treasury. Folks who aren't in the UK don't pay things like VAT, stamp duty, insurance premium tax, local government tax, national insurance tax, tobacco and alcohol duty, TV licence etc.... It means those of left here will pay more basically.Public Service Posting by the BBC - Bloggs Bulls**t Corp.
Officially CUK certified - Thick as f**k.Comment
-
Personally this is going to be interesting. I have been with Bedouin for 7 months, before that I was with Parasol and before that, I had a Ltd Company.
Like most people, I have no wish to fall fowl of the law or the HMRC so I'm now thinking of either going back to Parasol or opening my own Ltd again but as I have a single long term contract I'm not even sure if it's worth running through a Ltd? Any suggestions on what is the best path would be welcome folks.
Regarding Bedouin, they have been in touch and have announced they have been planning for the latest new rules which are to be implemented by April 2011 and have a raft of new schemes in place but have been caught out with the rapid timing of the new tax rules and the backdating to the 9th December.
So, EBT's are now a dead duck. Lifejackets are to the left and lifeboats are to the right everyone. Form an orderly queue please.....Comment
-
I'm also not affected by this new rule - I left a loan scheme some years ago though it is now being investigated.
I can't imagine anyone leaving the UK under the new general Tax Avoidance regulations. Someone who was getting 80% - 85% return may have to drop to 75% under a Ltd Co, so is that enough to leave the country for? I doubt it.
What I'm not looking forward to is the so-called 'clarification' of IR35, which will no doubt be to our detriment. Now this will indeed make many of us seriously consider a move abroad - if not for the money then certainly for a better standard of living. Hence my prior posts about moving to the States.
I'm happy to pay a certainly level of tax, I would say 25% is a good number in my mind. 30% at a stretch, because I understand that there are people that society needs to support, like RBS, Lloyds, and those who can but won't work etc. What bugs me is that none of my tax money goes into improving the country around us - we don't have nice trains/buses/streets/fields etc. Just a bloated, wasteful government. But I digress, so I'll stop.
I also know of more than one contractor who, on a certain loan scheme, retains 95% of his income. Personally I think that's obscene: this guy invoices over £150,000 a year and he contributes f* all to society. Now that's just plain wrong.Comment
-
Originally posted by Ciscokiddy View PostI'm now thinking of either going back to Parasol or opening my own Ltd again but as I have a single long term contract I'm not even sure if it's worth running through a Ltd? Any suggestions on what is the best path would be welcome folks.Originally posted by MaryPoppinsI'd still not breastfeed a naziOriginally posted by vetranUrine is quite nourishingComment
-
Originally posted by ChimpMaster View PostWhat I'm not looking forward to is the so-called 'clarification' of IR35, which will no doubt be to our detriment. Now this will indeed make many of us seriously consider increasing our rate to cover it.Never has a man been heard to say on his death bed that he wishes he'd spent more time in the office.Comment
-
Originally posted by ChimpMaster View PostI can't imagine anyone leaving the UK under the new general Tax Avoidance regulations. Someone who was getting 80% - 85% return may have to drop to 75% under a Ltd Co, so is that enough to leave the country for? I doubt it.
And you can be guaranteed that people will leave - I work for a monstrosity of a bank where most contractors are from overseas. Those on EBTs will leave in droves if they can't transfer onto other tax avoidance schemes, like commercial loans (which I am on).
Speaking of which, does anyone know if commercial loans is the next structure to be targeted?Comment
-
Originally posted by EBTContractor View PostThe changes are less about EBTs and more about loans. While they have been targeted at people using EBTs, EBTs themselves remain perfectly legal, it’s just that they will no longer be tax effective.
And you can be guaranteed that people will leave - I work for a monstrosity of a bank where most contractors are from overseas. Those on EBTs will leave in droves if they can't transfer onto other tax avoidance schemes, like commercial loans (which I am on).
Speaking of which, does anyone know if commercial loans is the next structure to be targeted?Comment
-
Originally posted by LisaContractorUmbrella View PostCould you give more details of how the scheme works EBTContractor?Comment
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Comment