Dodge tax like a footballer

[MrRobin]

There have been a number of articles (probably just rewrites of the same original) recently on t'net about footballers using companies to lower their tax liability. For example:

Dodge tax like a footballer - Yahoo! UK & Ireland Finance

Basically, it says that footballers get the vast majority of their fees paid to a ltd company, and they then just take loans from the company and pay the current interest rate (2%) in charges, plus 20% in corporation tax.

First question is, I thought it was 4% and 21% respectively.

Second question is am I missing something? I thought there was an additional corp tax levy if you have a directors loan for more than a year? 25% of loan value isn't it?

Third question, can any of this be applied to contractors with ltd companies?

[malvolio]

The objective is to run a business and to work for yourself, not to dodge tax. Meanwhile do a search on EBTs on these fora and see just how dangerous your suggestion really is...

[MrRobin]

The objective is to run a business and to work for yourself, not to dodge tax. Meanwhile do a search on EBTs on these fora and see just how dangerous your suggestion really is...

I'm not trying to advocate the use of such schemes, I just want to understand if the article has it wrong or not...

[Bunk]

There have been a number of articles (probably just rewrites of the same original) recently on t'net about footballers using companies to lower their tax liability. For example:

Dodge tax like a footballer - Yahoo! UK & Ireland Finance

Basically, it says that footballers get the vast majority of their fees paid to a ltd company, and they then just take loans from the company and pay the current interest rate (2%) in charges, plus 20% in corporation tax.

First question is, I thought it was 4% and 21% respectively.

Second question is am I missing something? I thought there was an additional corp tax levy if you have a directors loan for more than a year? 25% of loan value isn't it?

Third question, can any of this be applied to contractors with ltd companies?

On a side note, I just did a quick Webcheck lookup on the companies mentioned in the article. Owen Promotions (Michael Owen) and Toocoo (David James) have their registered address at a tax company and a law firm respectively, but Theo Walcott's TJW (Promotions) is registered to a massive house in the country. Wonder if he left his own address on there.

[MrRobin]

OK it's about EBTs and non-'close' companies. I wasn't aware of the difference.