Isle Of Man Ltd Company

[Francko]

I have a similar setup, I have a Swiss holding company that owns my UK Ltd company and charges very heavily for use of tradename, computer equipment and miscellaneous management fees.

Would you be able to invoice in UK with a Swiss Company and pay taxes in Switzerland only or would you be forced to use a LTD should you contract in UK but live in Switzerland? (let the 183 days rule safe)

[NotAllThere]

You work in the UK through your UK company which belongs to the Swiss Holding company. Then the UK company doesn't make a profit, so tax due in the UK.

You work in CH through your Swiss company.

All tax is due and paid in Switzerland.

Or did I get it wrong?

matt ( C permit, so yah-boo sucks )

[ookook]

how does having a holding company help? do you work in switzerland/uk through your UK ltd? then I can see the advantage

[oilyrag]

I was born in the UK but my 'official' residence is Switzerland (B permit).

[ookook]

I have a similar setup, I have a Swiss holding company that owns my UK Ltd company and charges very heavily for use of tradename, computer equipment and miscellaneous management fees.

Are you resident in Switzerland or UK? just curious..

[ASB]

Nope, a fully legal UK-based company - possibly owned by the IoM one - to supply services for UK-based contracts. Nothing to stop the IoM company charging it money for use of trade names, for example. CT is paid on profits, but if the UK company has to pay most (if not all) of its post-expenses income to the IoM company there won't be any...

There are taxation implications and you have to be wary of other financial regs, but in theory it would work just fine: it's not like the OP is trying to cheat any taxation arrangements, after all, merely satisfy a supplier requirement. But he will need expert advice just in case.

It might also be worth considering the residency status of the UK company both under UK and IOM rules. Seeking advice as to where the UK company is resident given the location of the owners and its management may be appropriate. This may determine whether the OP should own the UK company or the OPs Manx company should.

[allerune]

one question

Hi,
I'm following your discussion and just I have one question. What are rates that this whole setting up multiple companies in various countries thing starts to make sense? I mean, there are a lot of legal, accounts etc. fees that need to be paid.
There are umbrella companies that provide services for contractors (mostly for offshore contractors in UK or Ireland) basically hiring them and paying half of their wages in the country they work and the other half as a dividend in IoM. The rule is similar, but it is so much easier (and cheaper?).

Cheers!

[darmstadt]

But how do you have a UK company if you're not UK resident?

Quite easy now. A log of Germans are starting LTD's because its cheaper than a GmBH, legal too.

[NotAllThere]

But how do you have a UK company if you're not UK resident?

[oilyrag]

I have a similar setup, I have a Swiss holding company that owns my UK Ltd company and charges very heavily for use of tradename, computer equipment and miscellaneous management fees.

[malvolio]

Mal - can you explain a bit about a holding company? How would that work? Do you mean find a UK company who will act as intermediary between you and the agency?

Nope, a fully legal UK-based company - possibly owned by the IoM one - to supply services for UK-based contracts. Nothing to stop the IoM company charging it money for use of trade names, for example. CT is paid on profits, but if the UK company has to pay most (if not all) of its post-expenses income to the IoM company there won't be any...

There are taxation implications and you have to be wary of other financial regs, but in theory it would work just fine: it's not like the OP is trying to cheat any taxation arrangements, after all, merely satisfy a supplier requirement. But he will need expert advice just in case.

[NotAllThere]

My reason for using Manx company is the manx corporation tax, but this is academic as all earnings generated in the UK will be taxed at source based on the prevailing fiscal regime!

Perhaps it's better to say that all profits generated in the UK will be liable for tax in the UK. At least, that' my understanding.

AFAIK there is nothing in legislation to prevent you working through your off-shore company. I know there are some agencies who don't have a problem with it, for non-UK residents. But there's nothing either to make them accept you. Especially if your company is non-EU. This is a problem I've been concerned about.

Mal - can you explain a bit about a holding company? How would that work? Do you mean find a UK company who will act as intermediary between you and the agency?

[McBainCo]

Thanks Malvolio.

I think you are right ref using a UK company.

My reason for using Manx company is the manx corporation tax, but this is academic as all earnings generated in the UK will be taxed at source based on the prevailing fiscal regime!

[malvolio]

My last contract fell through because of a "misunderstanding" ref starting date.
I put that behind me and sought other contracts.

I have 2 offers and I accepted one. I am keen to understand why the agency is refusing to sign the contract with my Isle of Man resident company.

1. My company is incorporated on the Isle of Man and is VAT registerd there too.
2. I am a Manx resident who pay Manx taxes.
3. I spend time between the UK, France, IOM and other jurisdiction
4. I am aware of the 183 days rule.
5. I do have various advisors, fiscal and financial and I believe that overall I am properly advised.

My questions are:

a) Why is wrong with using my resident Isle of Man Company?
b) Why are they also refusing to take me through my French ltd company?
c) Is it part of their responsibilities to ensure that I conduct properly my fiscal affairs?

a) It's not a UK company.
b) See (a)
c) No, but they have to look after theirs. They are also free to say who they want to deal with and on what basis

Agencies are pretty risk averse, and there is so much HMRC-induced flak around offshore companies and tax evasion at the mo they are all taking the safe route. I should speak to an IOM-based accountant and see about using a UK-based holding company: in your case, as an IOM resident, it's probably perfectly safe to do so.

[McBainCo]

My last contract fell through because of a "misunderstanding" ref starting date.
I put that behind me and sought other contracts.

I have 2 offers and I accepted one. I am keen to understand why the agency is refusing to sign the contract with my Isle of Man resident company.

1. My company is incorporated on the Isle of Man and is VAT registerd there too.
2. I am a Manx resident who pay Manx taxes.
3. I spend time between the UK, France, IOM and other jurisdiction
4. I am aware of the 183 days rule.
5. I do have various advisors, fiscal and financial and I believe that overall I am properly advised.

My questions are:

a) Why is wrong with using my resident Isle of Man Company?
b) Why are they also refusing to take me through my French ltd company?
c) Is it part of their responsibilities to ensure that I conduct properly my fiscal affairs?