85% – 90% Limited Company Returns Onshore

Limited Company Returns

Limited Company Returns

British contractors can now get limited company returns of 85% to 90% returns on their income – or even higher. We have one company which offers 92% returns.

Those British contractors who paid the IR35 Tax are the worst off of all contractors as they pay tax as if they were a permanent employee.

Onshore Umbrella Company Contractors

Onshore umbrella company contractors are next worse off. They were able to claim up to 5% of their expenses against tax and so were able to save a little.

However, the Chancellor intends to take away their ability to offset expenses such as travel and subsistence against tax. He intends taking this away in April 2016. He is currently in consultations as to the best way to do this.

British Limited Company Contractors

A bit better off are the standard limited company contractors. It is reckoned that they pay £10,000 a year less tax than umbrella company contractors, on average.

Better still, are offshore umbrella company contractors who can get 84% to 90% returns on their money earned.

They are able to do this because of three British laws which explain, also, why the Government doesn’t stop offshore tax avoidance  :-

Money Sent Offshore Not Taxable

1.  Money sent offshore is not taxable. It used to be but that was one of the first laws that Mrs Thatcher brought in when she won the 1979 election.

Tory Grandees, like Lord Ashcroft, the Tory party’s biggest donor, Ian Cameron, David Cameron’s father, and Lord Astor, his father-in-law, took advantage of this.

They set up schemes that would save them a fortune in tax, and, in Ian Cameron’s case, to allow others to save a fortune in tax.

Loans Not Taxable

2.  The second law that makes this feasible is that loans are not taxable.

So, what happens is that British contractors pay their money to an offshore company who invest it for them.

The scheme pays the contractor the equivalent amount in loans.

Supposedly the contractor will pay the full amount of tax on that money when it comes back onshore. Of course it never does for reason.

Contractor Loans Not Inherited

3.  The third law that makes it feasible is that you don’t inherit loans. The loan debts of one generation do not pass to the next. Your loans die with you. This means that the loans you took out in lieu of your income will eventually pass away with you.

The Conservatives won’t change law as so many of their own make use of this to save themselves a fortune. The big hedge funds, who are such big donors to the Conservative party, would lose out if this was changed.

They won’t change the second law, i.e. they wouldn’t make loans taxable, as this would cause chaos in the banking sector. This is so lucrative worldwide for the UK, which has a dominant position in Europe in it.

They wouldn’t change the 3rd law, either, to pass on one persons loan debts to the next generation.

Can you imagination the outcry that would cause among Tory supporters if they did that?

So, that is why offshore umbrella companies work for British contractors.

Onshore Limited Companies

There is an alternative, now, however.

There are onshore limited company solutions which take advantage of efficient tax planning to give contractors similar returns that they can get from using offshore umbrella companies. However, all of the money stays onshore.

British contractors can get limited company returns in the same 85% to 90% bracket as they would for using offshore umbrella companies. However, all of the money stays onshore and passes through their own limited companies in the UK.

Companies Offering High Limited Company Returns

 Compare the Umbrella Solutions offer British limited company returns of 85% to 90%.

Those solutions have saved British contractors a fortune for years.

Offshore Umbrella Company Benefits

Offshore Umbrella Company Benefits

Offshore Umbrella Company Benefits

Benefits – so what are the offshore umbrella company benefits?

The main benefits are all connected to the money. This is the best way for contractors to keep most of their money. They can keep anywhere between 84% and 90% of their hard-earned money.

The exact amount depends on how much they are earning.

Mrs Thatcher Changed the Loan laws

Offshore Umbrella Companies started up when Mrs Thatcher changed the laws so that money sent offshore was no longer taxable. It was one of the first laws she brought in when she became Prime Minister in 1979. The Tory party grandees were among the first to get the benefits.

One of the earliest to benefit was David Cameron’s father Ian. He quickly saw the benefits  and set up lots of offshore schemes. Indeed he made his money that way. That’s where David Cameron’s inheritance came from.

Many of the Tory grandees saw the benefits and operate schemes like these including Lord Astor, David Cameron’s father-in-law and Lord Ashcroft, the Tory party’s main donor.

How Loans Works

So, the money that is sent offshore stays offshore. The Offshore umbrella company loans the contractor money in lieu of that loan. The loan is never paid back. The contractor defaults on that. The Offshore Umbrella Company takes the money in lieu of that.

Money is not taxed until it comes back onshore. The money never does. It is different money. Loans aren’t taxable. This is how it all works. It’s how the contractor benefits.

Tax Avoidance

It is tax avoidance, of course. However, it is legal and it is not tax evasion which is illegal.

The Government complain about it. However, it is they who make the rules. It is they who can change them. Contractors and others are only taking advantage of the rules as they are. They take the benefits from the Governments own laws.

Indeed it is the legal duty of the directors of a company to maximise the returns for shareholders.

Of course, the Government don’t want to change the rules as it benefits many of their party sponsors. Indeed George Osborne has a £4.5m family offshore trust. He sees the benefits of it.

Benefits Not Intended

It’s annoying for the Government when newspapers reveal that comedians and rock stars are reaping these offshore umbrella company benefits.

The benefits weren’t intended for the likes of them and contractors. The Government had to react. However, they don’t change the law.

For some examples of these companies see Offshore Umbrella Company List

offshore umbrella company list

Offshore Umbrella Company List

Best Umbrella Companies Alternatives for UK Contractors

Best Umbrella Companies Alternatives

Best Umbrella Companies Alternatives

So, what are the best umbrella companies alternatives?

Indeed, what makes a good umbrella company and what are the best alternatives to umbrella companies?

First of all what are the alternatives to umbrella companies.

Well, you could just pay tax as if you are an employee.

Retaining More of Your Money

For a person earning £100,000 a year that would mean that you would retain £55,000 of your hard-earned money and would give the Government £45,000 a year.

Chancellor Osborne would be delighted by that. He, of course, has an offshore family trust from which he benefits.

So, a freelancer using an Umbrella Company keeps £60,000 of his, or her, money earned and would send the Treasury £40,000 a year.

However, from April 1st 2016 much of this gain disappeared as the Chancellor decided that most umbrella company contractors are no longer able to claim travel & subsistence expenses against tax.

Limited Company Alternative

The main alternative to umbrella companies is the limited company – or the personal service company as the Chancellor likes to call it when one person owns it.

Therefore, of the £100,000 a contractor earns, he, or she, keeps £75,000 of that, donating £25,000 a year to the country.

Now, those using tax efficient limited company structures can retain £85,000 of their hard-earned cash.

Most limited company contractors don’t use the most efficient methods of protecting their income from the taxman and these vehicles help them to do so.

So, to find out more click on Limited Companies

Onshore Umbrella Companies

There are also specialist onshore non-PAYE umbrella companies who allow contractors to retain £85,000 a year using different methods.

So to learn more click on Umbrella Companies

Apply for More Information on All Three Options

So, just fill in the form below to get your information pack on how the above three best umbrella companies alternatives work. Click Y against each of those options for which you want to receive the Infopack.

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Offshore Umbrella Companies returns for UK Contractors

Offshore Umbrella Companies Returns

Offshore Umbrella Companies Returns

Offshore Umbrella Companies returns are the best returns a contractor can get. Those using them are able to keep the most of the money they earn of all contractors.

The returns can be as high as 90% depending on income.

It’s usually reckoned that a contractor using an onshore umbrella company will pay around ten grand a year tax more than one using a limited company.

However, offshore returns dwarf even that of limited companies. Indeed, it could make another ten grand’s difference again to the UK Contractor.

Difference in Take Home Pay

So, the difference between the annual take home pay between a contractor in an offshore company and one in an onshore one can be as much as £20,000 a year.

That’s a difference, over 15 years or so, of around £300,000. Once you’ve added in the extra earning potential of having that extra money to invest, it could be quite a substantial sum we are talking about.

On the Stock Market you are able to get an average return of around 12% a year, including dividends.

Extra Money Calculation

If you calculate how much your extra 20 grand a year would come to over 15 years at 12% interest a year, your money would be worth an extra £835,000 over that 15 years.

Of course, if you are better than the average Stock Market punter you could make even more.

So, it is clear that Offshore returns are much higher than for those using onshore companies. Using them would make contractors a million quid richer in 16 and one-third years, I calculate. That’s not to be sniffed at.

If you are going to be a successful and rich contractor you should maximise your returns from your earnings.

Apply for Offshore Umbrella Companies

So, to find out more, or to apply for one, click on Offshore Umbrella Companies List to get the best offshore umbrella companies returns and offers.

Offshore Umbrella Company Returns

offshore umbrella company list

Offshore Umbrella Company Returns

So, what are the offshore umbrella company returns on your hard-earned cash compared to other options?

First of all, what are the other options?

Firstly, you can just pay up on your IR35 tax. Secondly you can operate through a Limited Company (or Personal Service Company). Thirdly you can operate through a PAYE Umbrella Company. Finally, you can operate through an offshore umbrella company.

Offshore Umbrella Company

Offshore Umbrella Company Returns can vary anywhere between 85% and 90%, depending on your income. Using offshore umbrella companies are by far the best method of keeping most of your money.

So, if you earned £100,000 you would expect to keep £85,000 to £90,000 of the money you earn.

Limited Company (Personal Service Company)

This is the next best option. However, you would still be £10,000 to £15,000 down than the offshore umbrella company returns. You would expect to keep around 75% of your money. So, you would keep around £75,000 if you earned £100,000.

Onshore Umbrella Company

Using a normal onshore umbrella company would let you keep around 60% of the money you earn. This means you would keep around £60,000 of the £100,000 you earned.

PAYE Operator

If you pay the IR35 tax or use normal PAYE, you would get back around £55,000 of £100,000 that you earned.

There are many reasons for using one or the other. However, if it is a bean count, and you are just going for the most lucrative option then the offshore umbrella company returns of up to £90,000 makes it a no-brainer for contractors.

You could be keeping up to £30,000 a year more by using an offshore umbrella company rather than using a normal onshore umbrella company. That mounts up over time. That money escapes you.

To find out more about offshore umbrella company returns you should click on Offshore Umbrella Company Directory

offshore umbrella company list

Offshore Umbrella Company List

Umbrella Company Reviews – Offshore Umbrella Companies

Umbrella Company Reviews for Contractors

Umbrella Company Reviews

Contractors often ask us for Umbrella Company Reviews. We are happy to oblige.

There are two types of Umbrella Company. There are offshore umbrella companies and there are onshore umbrella companies.

The Umbrella Companies HMRC prefer are the onshore umbrella companies. That’s because they get more tax from them.

Tax Avoidance Measures

So, Offshore Umbrella Companies are tax avoidance – but legal tax avoidance. They allow the contractor to keep from 80% to 90% of his, or her, money earned.

Contractors choose an umbrella company or a limited company. The Limited company options returns more to the contractor than the onshore umbrella company. However, offshore umbrella companies return the most.

We have offshore umbrella company lists and onshore umbrella company lists on other pages on this website.

Umbrella Companies Explained

Many of the offshore umbrella companies operate from the Isle of Man.

Onshore Umbrella Companies allow contractors to lay some expenses off against tax. The top umbrella companies are the safe ones.

Contractors can claim travel expenses and overnight expenses against tax as well as a few other things like pension contributions.

Umbrella Company Reviews and recommendations

Umbrella Company Reviews offshore and onshore

Umbrella Company Reviews and Comparisons

With an onshore company you would probably keep about 60% to 65% of the money you earned. With a Limited Company it would be maybe around 75%. With the offshore companies you would keep from 80% to 90%.

There are also companies which operate like the offshore ones but are onshore. They allow contractors to still use their limited companies.

Sometimes, agencies try to steer contractors towards particular umbrella companies. However, the suspicion is that they get commission from doing this. This is illegal under the 2010 Bribery Act – but they still do it.

Working through those offshore umbrella companies is the most lucrative for contractors. Using umbrella companies like that will have returns of up to 90%.

Umbrella Company List

To find some of these offshore umbrella companies, and more umbrella company reviews, you should click on Offshore Umbrella Company List

Contractors who want to find moneymaking opportunities should click on Contractor Moneymaking

Offshore Isle of Man Umbrella Companies – Autumn Statement leaves them alone

Autumn Statement

Autumn Statement

Offshore Isle of Man Umbrella Companies are in the news due to the Chancellor’s Autumn Statement.

The Chancellor unveiled his new tax avoidance measures yesterday in the autumn statement. He says will net the government £9bn extra in taxes. However, he has made those predictions before and only managed to get a fraction of what he expected to get. Most contractors using offshore  Isle of Man Umbrella Companies will not be hit.

There are two areas that the Chancellor is attacking as regards tax avoidance.

Intermediary Companies Legislation

Firstly, the Chancellor is targeting Intermediary Companies.

This is where UK companies register their UK employees as self-employed and pay them through Intermediary companies offshore. This saves the employer paying National Insurance on them.

Several hundred thousand construction workers are ’employed’ this way. It is the companies that get the main benefit. It is not something that affects most contractors in Offshore Umbrella Companies.

False Partnerships Crackdown

Secondly, the Government is going to crack down on what they see as false partnerships, i.e. those set up just to avoid tax. This may affect some Offshore Umbrella Company contractors, if the Isle of Man Umbrella Companies have set them up as partners. However, it is only a small percentage that are set up this way.

All that would happen here is that the offshore Isle of Man Umbrella Company owner would change to a new scheme that is legal and move their contractor over to it.

This legislation is not retrospective so there would be no legacy problems for contractors here. There will be no back payments that HMRC can claim. The very fact that they are changing the law on partnerships means that it was legal before. It will be legal right up to April 2014 when the contractors, presumably, will move to a new legal Offshore Umbrella Company scheme.

Government and HMRC

It would be different if the Government and HMRC fought a scheme through the courts and won. Then the contractors might have problems. However, the Government haven’t won many of these.

If the Government are to get anywhere near the £9bn that they expect to get then they are going to have to get it through the Intermediaries side of it. They may get some from onshore partnerships.

Offshore Isle of Man Companies

However, after this autumn statement those contractors using offshore Isle of Man Umbrella Companies can rest more easily. They weren’t in the Government’s line of fire this time around.

The vast majority of the offshore umbrella company schemes were legal and remain legal under current UK laws. If they do make them illegal, in the future, the legislation will not be retrospective. So, contractors whose schemes are made illegal will not lose out and have to pay back taxes.

For a list of legal Offshore Umbrella Companies you should click on Offshore Umbrella Company List

Applying for Contractor Mortgages

If you want to find out more see Specialist Contractor Mortgages

To apply for one of those specialist contractor mortgages see Contractor Mortgages Application

 

Isle of Man Umbrella Companies happy with Budget

Isle of Man Umbrella Companies for contractors

Isle of Man Umbrella Companies

Isle of Man Umbrella Companies are happy with the latest budget.

The Chancellor took aim at tax avoidance in his budget today – especially offshore tax avoidance. However, the Isle of Man Umbrella Companies appear to have got away relatively lightly compared to Jersey and Guernsey.

The Chancellor has acted on the intermediaries tax loophole where UK companies avoid payroll tax by routing their payroll offshore in places like Jersey and Guernsey.

Isle of Man Umbrella Companies

Isle of Man Umbrella Companies for UK contractors

Often the temporary workers used by those UK companies didn’t even know it was happening. This is even though it could have led to them losing sick pay and maternity pay entitlement.

Illegal Schemes

However, these schemes are illegal in the Isle of Man and one company was fined for trying to operate one.

The Chancellor also said that he would work with the Isle of Man, Jersey and Guernsey over disclosure. However, the former has been ahead of the game here and has worked closely with HMRC and the Government.

The people targeted are those who hide money in offshore bank accounts.  It’s not about contractors who use offshore umbrella companies.

The companies will feel that they got away relatively lightly.

Contractors can retain 85% of their income by using these companies. Many contractors are now doing so.

Here is one here:-

Compare the Umbrella

 

Forced Disclosure for Isle of Man Umbrella Companies

Forced Disclosure

Forced Disclosure

Forced disclosure is the latest Government tool against tax evasion.

The Government has just announced a new deal with the Isle of Man where the island will give the Government the names of UK citizens with offshore bank accounts. Forced disclosure is the latest in their war against tax avoiders. This has been whipped up by the media in the UK. Similar deals with Jersey and Guernsey are expected soon.

Said Danny Alexander, Chief Secretary to the Treasury, in an interview with The Times “Any jurisdiction that refuses to enter into one of these information disclosure agreements is taking a huge risk with their reputation. It’s the price of doing business”.

So, it looks as if the Isle of Man agreed voluntarily to a certain extent. Said Alexander “Every tax jurisdiction that once thought it could operate on the basis that it could be an offshore haven needs to think again. Everyone should pay their proper amount of tax.”

Isle of Man

The Isle of Man’s Chief Minister said “This decision is a well-considered next step in the island’s long-established policy of commitment to being at the forefront of tax transparency and international co-operation. It is logical for the Isle of Man to embrace new forms of tax co-operation with our largest trading partner, the UK”. So there you ar then.

So, what does that mean for contractors who are operating under offshore umbrella companies schemes there? Does forced disclosure mean that the game is up for them? Will those offshore umbrella companies have to shut down now?

Government Frustration

Far from it. Forced disclosure is more to do with tax evaders than tax avoiders. The Government’s frustration is because most of these schemes are legal under the laws of the UK. Therefore, it would be very hard for the Government to shut them down. Most of the companies in the Isle of Man already disclose this information anyway. They have nothing to hide if they are acting legally and the schemes are legal.

Government Frustration

As the Government can do little about it, what they are trying to do now, in frustration, is to scare contractors out of the offshore umbrella companies. They are doing this by forcing the Isle of Man to bring in disclosure rules to hand that information over to the UK Government. However, once the Government has that information they can’t use it to prosecute people who are operating within the law.