Guilty until proved innocent

[tomtomagain]

First, I need to point out that I have never used any scheme and have been LTD since I started contracting.

With that out of the way, I find comments like yours, aimed at people who were in schemes, utterly ridiculous and the product of someone who has no real clue about contracting or business.

Glad to hear it.

So this is my version of events. I worked as a contractor in "The City" for a decade. In a team of 60+ contractors within a department of over 100 contractors.

Back in the early to mid 2000's these schemes were a hot topic of conversation. The vast, vast majority of the people at the places I contracted knew to avoid these with a barge poll. They were too good to be true.

However there was a small minority of contractors who absolutely hated paying any tax and would gleefully tell everyone within our group about how they had signed up to some "Loans" scheme. The schemes went like this. All contract money went to some offshore entity. Offshore entity gave them a "Loan" but they were never expected to pay that loan back.

We had guys paying around 2% tax. From my recollection of the time we had numerous pub conversations on the subject with people pointing out ( not just myself ) that even if the scheme's were technically legal that joining them was going to expose one's self to a huge risk.

It was patently obvious ( even to someone like me who knows nothing about business or contracting ) that a scheme that let you cut your tax rate from around 35% to 5% was not going to be allowed to exist for long.

A number of the guys ( and one of the gals ) I knew back then have been caught. Yes they are bleating that "It's not fair". But they really only have themselves to blame. Plenty of people were telling them to stay well clear of these arrangements at the time.

Of course there may be some people who went through a Brolly and were pushed into such a scheme, OK, I could feel some sort of pity for them if I really tried hard. But really they should have done more research.

the product of someone who has no real clue about contracting or business.

Well I might not know anything compared to you but I managed to turn my "Plan B" into a full time "Plan A". Am just coming up to the end of my second year full time on "Plan B". With a record turnover and profit.


Haven't had a contract in 24 months. Made more money than ever. Do I get a "Boomed" or a Banana?

[MicrosoftBob]

He was involved in some dodgy scheme.

The tax laws will change. Our tax rates will go up and down. But nobody is coming to come after me and say "You owe 30k".

If you keep it simple then there's nothing to fear.

If on the other hand you have joined a scheme that promises to cut your tax rate to 10% by lending you some money from a fictitious source that you don't have to pay back then you were a fool.

Like Hector changed the basis of S660 because they wanted to go on a cash grab

If you're alive or dead Hector will bleed you dry as much as they can, above and beyond the law

[raphal]

HMRC APN INFO

[AtW]

First, I need to point out that I have never used any scheme and have been LTD since I started contracting.

Good.

I'll get you last then.

HTH

Hector

[AtW]

If you're alive or dead Hector will bleed you dry as much as they can, above and beyond the law

How often did it happen to people who earned enough to pay 40/45/50 taxation levels?

It happens, as predicted long time ago, to those who thought that paying 5-10% to "scheme provider" and 0% to HMRC would results in savings on 40/45% tax.

HMRC got 0% instead of 40/45%, what kind of stupid person did it take to think it would be ok AFTER it was required to provide DOTAS number?

[cojak]

And take a time machine back to 2005

http://forums.contractoruk.com/accou...html#post22837

Dear Underscore2 and Rebecca Loos - where are they now?

Probably with a new user login in HMRC EBT Scheme Enquiries thread...

[centurian]

So this is my version of events. I worked as a contractor in "The City" for a decade. In a team of 60+ contractors within a department of over 100 contractors.

This is my recollection of the past as well.

Also to add that the contractors in the schemes were continually winding up the other contractors - "thanks for paying my tax for me" etc.

I have sympathy for the fact that HMRC sat on their backsides for years, adding some weight to the claims of the providers that it was all "legal".

However, they all knew there was something slightly dodgy about these schemes. No-one can be intelligent enough to work in these places, yet so stupid to believe that paying virtually no tax doesn't even have the slightest risk attached to it.

[cojak]

This is my recollection of the past as well.

Also to add that the contractors in the schemes were continually winding up the other contractors - "thanks for paying my tax for me" etc.

I have sympathy for the fact that HMRC sat on their backsides for years, adding some weight to the claims of the providers that it was all "legal".

However, they all knew there was something slightly dodgy about these schemes. No-one can be intelligent enough to work in these places, yet so stupid to believe that paying virtually no tax doesn't even have the slightest risk attached to it.

Some of them admitted to greed (and thought that they knew the risk...) http://forums.contractoruk.com/accou...tml#post444417

[cojak]

News Just In - Huitson Appeal Lost

Oh Very Dear...

http://www.financeandtaxtribunals.go...99/TC04621.pdf

The beginning of the end I fear...

Better brace myself and get the hot sweet tea and Citizan's Advice Bureau contacts at the ready...

[DaveB]

The problem here isn't that people used dodgy tax schemes, although HMRC would like you to think it is.

What is happening is that HMRC are able to effectively demand money with menaces for tax bills that may or may not actually be due and force you to pay them upfront before actually being allowed to challenge whether they have got it right or not. They don't have to prove anything, they just have to make the demand. The onus is then on the tax payer to show that they paid the correct amount of tax in order to get their money back. The people who decide whether they have done that are HMRC.

If they make it work with the historical avoidance cases, which may or may not have been legitimate at the time, then you can bet they will start looking for other ways to apply it. Stand by for Advance Payment Notices for tax from Ltd contractors on the basis that they think you should have been operating inside IR35 6 years ago.

And no, having insurance from QDOS et al will not mean you don't have to pay it. It just means you might get it back at some unspecified point in the future.