Reply to: Avoid the rules and get an offshore?

[The Lone Gunman]

Are you talking about the ramsay principle?

From Lord Clyde:

That quote should be a sticky at the top of every contractor web site in the country and possibly the (rather long) slogan for them too.

[Antman]

Hi,

I've been a Spanish resident for the past 6 years and I'm about to do one to Brazil, hopefully for good. I'm working on a 6-monther here in the UK, but I'll have spent less than 183 days here in the end.

Can I be non-domiciled here and own a ltd? (I'm having to do it for the last 8 weeks of my contract, thanks Gordy!) I'm thinking of not paying tax and then ..errm declaring it to the Spanish Authorities

Can anyone recommend a good tax accountant for this kind of situation.

A-thanking ewe!

[ASB]

If you are UK tax-resident but not UK tax domiciled you broadly only pay tax on non-UK source income to the extent that it is remitted to the UK.

In the event of not being UK domiciled but UK resident do you think that HMRC might attempt to raise an argument that non remitted income generated by working outside the UK was still UK generated income due to the management of the company being UK based ?

[THEPUMA]

If you are UK tax-resident but not UK tax domiciled you broadly only pay tax on non-UK source income to the extent that it is remitted to the UK.

[malvolio]

It's possible, but it's all about the defninition of tax residency. If you are deemed to be UK resident for tax purposes, you will pay UK tax on all your worldwide earnings regardless of source: and, of course, concealing such earnings comes under the heading of Tax Evasion (thanks to the EU the tax authorities work together, incidentally, so hiding it in Germany might be difficult). You need to check the rules very carefully to see where you fit in (and they are under review becuase of people like Phillip Green's cavalier attitude to paying UK tax, incidentally).

Assuming you pass the residency test, what you suggest makes sense, but I would get professional advice.

[florida]

How about uk residents domiciled elsewhere?

Granted this service sounds too good to be true.

I'm just wondering, however, if such a service isn't useful if you live in the uk, but are domiciled and work abroad. That's my situation, and in practice I'm only taxed on the money I bring into the uk ("remittance basis").

If I invoice my clients in the EU (Germany usually) through them, I could 'store' any surplus money offshore and decide when to bring it onshore if and when I need it or the tax situation is favorable. Of course it remains to be seen how the client's host country views such income...

Does anybody have an opinion on that or encountered such structures? And are there offshore umbrella companies that charge a flat fee rather than %% of contract value?

Thanks for info.

florida

[quakersboy]

Avoid the rules and get an offshore?

You have to be very very careful with offshore schemes - apparently they must comply with the 1950's Ramsey judgement. I only know of one that does comply - and I am in it. All worked very well so far.

...and would be prepared to recommend and name said company?

[ratewhore]

You have to be very very careful with offshore schemes - apparently they must comply with the 1950's Ramsey judgement. I only know of one that does comply - and I am in it. All worked very well so far.

Are you talking about the ramsay principle?

From Lord Clyde:

No man in this country is under the smallest obligation, moral or other, so to arrange his legal relations to his business or to his property as to enable the Inland Revenue to put the largest possible shovel into his stores. The Inland Revenue is not slow - and quite rightly - to take every advantage which is open to it under the taxing statutes for the purpose of depleting the taxpayer's pocket. And the taxpayer is, in like manner, entitled to be astute to prevent, so far as he honestly can, the depletion of his means by the Revenue

[PAG]

I was using a offshore company in the Isle of Man called "Aceline". They are ceasing trading soon (presumably due to the new laws).

My agency has explicitly recommended I move to another Isle of Man company called Charterhouse, using a product called CSS : Charterhouse

They work in the same way it seems. I send them a timesheet, they invoice my agency, agency pays Charterhouse and Charterhouse pay me, GROSS, into my personal bank account. I can still claim expenses incl travel and food.

To be honest, it sounds too good to be true. I thought the whole point of all this legislation was to stop people avoiding tax. Am I really at risk if I use these people - even if I DO pay all my tax as a should ?

A friend of mine has been using Charterhouse for some time but his agency is refusing to let him use them as they are saying THEY could be liable for tax debt if he doesnt pay his tax. seems a bit excessive?

Going offshore is going to save me a fair amount especially now the tax is up 2% for small businesses (i.e. PSCs).

Anyone have a good reason why we ALL shouldnt just do it all offshore???

thanks in advance for your comments.

Cheers
James,
London

Are you serious ??

[ContractIn]

You have to be very very careful with offshore schemes - apparently they must comply with the 1950's Ramsey judgement. I only know of one that does comply - and I am in it. All worked very well so far.

You need to consider whether UK onshore agencies and direct clients will deal with offshore set-ups. I have had one contract recently, where I sourced direct, but almost didn't get the contract as the end client would not sign the offshore provider’s contract, eventually found a mutual way to get around i.e. had to go through an intermediary agency. I am now aware that many agencies will not deal with this company in current set-up as. Even if HMRC cannot get tax from the offshore company; and you, they will seek to get reimbursement from the agencies and end clients. So obviously do not wish to deal with anyone who appears to be using such set-ups.

I am seeing out current contract and will then move to Ltd.

[portseven]

I believe that Reed are still reccomending Focused consulting for people. They operate via Isle of Mann using a split between, NMW + Trust Fund.

[BrilloPad]

You have to be very very careful with offshore schemes - apparently they must comply with the 1950's Ramsey judgement. I only know of one that does comply - and I am in it. All worked very well so far.

[boredsenseless]

Nah it's just too easy...

However the OP might like to consider words such as UK, Tax, Residency, Evasion, Jail sentence...? Or more economically aligned phrases such as Tax Due, Payment Annually, No F***ing Difference in net income...? Or perhaps "WTF are you doing paying someone to give you all of your own money back and why do you think any sane person would do such a stupid thing?"

It's not like you to beat around the bush!

[simondolan]

And the fact that no agency in their right mind would deal with any Company like this anymore.

[malvolio]

Nah it's just too easy...

However the OP might like to consider words such as UK, Tax, Residency, Evasion, Jail sentence...? Or more economically aligned phrases such as Tax Due, Payment Annually, No F***ing Difference in net income...? Or perhaps "WTF are you doing paying someone to give you all of your own money back and why do you think any sane person would do such a stupid thing?"