Reply to: Running your company from Ireland

[Flat Eric]

I looked into this. I seem to recall a requirement to have one resident national employee.

Not in Belize ..

[Platypus]

There's been a couple of cases in the news where big companies have moved their head offices over to Ireland to take advantage of the better tax regime.

As I understand it headline corp tax in Ireland is 12.5%.

Can anyone see any issues with me setting up an irish company and using it to bid or use agencies to source contracts in the UK.

Thx
Mark.

I looked into this. I seem to recall a requirement to have one resident national employee.

[ASB]

I've not gone bright red after blurting out a guffaw and having everyone in the office looking at me

Anyway, I'm not daft enough to assume that Hector would simply walk away. I'm sure they'd want to investigate the company but if you'd received bearer shares which meant they'd have to find out which company it was, who the directors are, then who the shareholders are.. I think it would be just too onerous and expensive on their part. You might get some senior inspector who'd relish the challenge ..

The belizian authorities wouldn't have a case against you as you'd have done nothing wrong in belizian law and as stated, only the courts could order the details to be made available which would tell them that this company was owned by a Panamanian company...

Whilst you are not going to persue this it's not as easy as this.

HMIT requires you to confirm full disclosure before closing the enquiry. If he ever discovers you haven't you are quite likely to get locked up.

Also, he can simply say "I'm not happy, heres an assessment for x." Now it's down to you to disprove this.

So, it's not onerous and expensive on their part. It's onerous and expensive on yours. I seem to recall Lester Piggott discovered some of the problems than can occur.

Ken Dodd didn't though so you never know your luck.

[meridian]

Me.. Nope, total wuss..

Just playing devils advocate. If I thought I could get away with it then I'd be out there faster than a fast thing from planet fast wearing the very fastest pair of trousers....

But that's the problem - you're not thinking "how do I structure my affairs in a manner that will comply with the current tax legislation and minimise my overall taxation", you're thinking "what can I get away with whether it's legal or not".

If you really want to minimise your taxable income, just move to the IOM. Bingo, no longer a UK tax resident.....

[Flat Eric]

Seems to me after reviewing this thread you have convinced yourself that this is the way forward despite the numerous warnings that have been provided by other posters. Good luck

Me.. Nope, total wuss..

Just playing devils advocate. If I thought I could get away with it then I'd be out there faster than a fast thing from planet fast wearing the very fastest pair of trousers....

[Not So Wise]

[quote]How many agents are going to want to chuck in the towel & revenue stream..[quote]
Quite a few. Until around 2000/2001 good portion if not majority of contractors used off shore companies, as some of these were EU based Tax man could not just ban them so they informed a lot of the agencies that if they see them doing business with m(any) of these companies they best prepare for the audit from Hell. The agencies wisely chose to avoid this and now any sensible one will not accept offshore companies for any money

Is there a way around this? Yes
What is it? Irish Nominee Company Structure (or if contracting in Eire use the UK version)
Is it legal? Technically yes, but like most tax avoidance methods the devil is in the details, aka how you really operate it, in determining how legal

[oracleslave]

I've not gone bright red after blurting out a guffaw and having everyone in the office looking at me

Anyway, I'm not daft enough to assume that Hector would simply walk away. I'm sure they'd want to investigate the company but if you'd received bearer shares which meant they'd have to find out which company it was, who the directors are, then who the shareholders are.. I think it would be just too onerous and expensive on their part. You might get some senior inspector who'd relish the challenge ..

The belizian authorities wouldn't have a case against you as you'd have done nothing wrong in belizian law and as stated, only the courts could order the details to be made available which would tell them that this company was owned by a Panamanian company...

Seems to me after reviewing this thread you have convinced yourself that this is the way forward despite the numerous warnings that have been provided by other posters. Good luck

[Flat Eric]

... Hmm, maybe we'd better have a ferret around a bit.

I've not gone bright red after blurting out a guffaw and having everyone in the office looking at me

Anyway, I'm not daft enough to assume that Hector would simply walk away. I'm sure they'd want to investigate the company but if you'd received bearer shares which meant they'd have to find out which company it was, who the directors are, then who the shareholders are.. I think it would be just too onerous and expensive on their part. You might get some senior inspector who'd relish the challenge ..

The belizian authorities wouldn't have a case against you as you'd have done nothing wrong in belizian law and as stated, only the courts could order the details to be made available which would tell them that this company was owned by a Panamanian company...

[ASB]

But you'd have nothing to declare, you would simply say you the income from shares held in a belizian company.. I'm sure there's no law against that..

Why don't you see what happens in an aspect enquiry and what they might ask you. Then decide whether "I received x in dividends from Wibble LBC Belize" is likely to make HMIT say:-

a) Jolly good, enquiry closed
b) Hmm, maybe we'd better have a ferret around a bit.

[Flat Eric]

Because they can. Self assessment is oddly enough based on checks being made rather than blind faith.

There are time limits on when they can do this and what they can reopen. Load of details on HMRC website. Unfortunately not many on how to avoid getting picked for one.

But you'd have nothing to declare, you would simply say you the income from shares held in a belizian company.. I'm sure there's no law against that..

[Flat Eric]

It's all academic - the point is you are not going to be able to operate in this regulated contract market (other businesses are different, eg sales, property, web-services) with a co. based in Belize/Panama/etc.
Cue in the requests for copies of co.reg/vat reg/bank name & account nos that we've been endlesly debating here.

Ok, get the contracts signed by your ltd in this country, start work at client site, then approach agent and say you want the contracts changed to reflect your offshore.. How many agents are going to want to chuck in the towel & revenue stream..

[ASB]

Because they can. Self assessment is oddly enough based on checks being made rather than blind faith.

There are time limits on when they can do this and what they can reopen. Load of details on HMRC website. Unfortunately not many on how to avoid getting picked for one.

[Flat Eric]

Well an aspect enquiry into your SA return would be a good way for the ball to start rolling....

And why would they do that. What would prompt them to do this.. You would be paying tax on the share dividends you earned at the appropriate rate.

That's exactly how my grandparents receive a good portion of their pension. They get a state pension and have their income topped up with dividends on shares they hold. They get about several thousand between them and they pay all their income tax etc accordingly.

No one, to my knowledge, has ever asked them wether they control any of the companies they get dividends from.

Surely, HMRC would have to prove that a company in belize is being run by someone in the UK. Only the court of belize could order such an investigation and recover any documents citing anyone with a controlling interest. Hell, what's to stop you muddying the waters even more by putting control over the belizian company into the hands of a Panamanian one.

[Dow Jones]

Won't wash

It's all academic - the point is you are not going to be able to operate in this regulated contract market (other businesses are different, eg sales, property, web-services) with a co. based in Belize/Panama/etc.
Cue in the requests for copies of co.reg/vat reg/bank name & account nos that we've been endlesly debating here.

[ASB]

Ok,

I suppose the point is.. How could HMRC find out if a company in belize is controlled by someone in the UK. They could appoint nominee directors and all shareholder details are not recorded with the belizian authorities.

All they would see is a UK person drawing income via dividends as reported on the SA.

Well an aspect enquiry into your SA return would be a good way for the ball to start rolling....

I accept that HMRC may find it difficult to find out, but any "scheme" that is predicated on them not finding out probably isn't going to work out too well. IF they do find out I suspect that you might have some problems convincing them it was a genuine mistake. This has significant impact on the level of penalties and substantially increases the risk of criminal charges.

Even though Belize uses (generally) bearer shares there is still some link to you somewhere in the chain.

Ask yourself this question: If the money can be paid to you there is documentary evidence of where it came from. If you can cause it to be paid then there is documentary evidence of your control. If you can't cause it to be paid how are you going to get it?