85% – 90% Limited Company Returns Onshore

Posted on July 12, 2016 by admin

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

Posted on June 23, 2016 by admin

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 Â£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 Companies and how they work

Posted on April 14, 2016 by admin

How They Work

Contractors want to know how they work.

Offshore Umbrella Companies normally operate through loans. In 1979 the Thatcher government, in one of its very first bills, allowed money to go offshore untaxed. It doesn’t get taxed till it comes back onshore, if ever.

This opened the way for offshore schemes and offshore umbrella companies which operate in places like the Isle of Man, Jersey, the Bahamas, Bermuda etc.

Indeed most of the world’s hedge funds operate from one of the UK’s offshore islands.

How they work is that money held offshore is not taxed unless it returns to the UK. Among the first to take advantage of this were the Tory Party grandees.

David Cameron’s father made his money this way by setting up schemes both for himself and others. David Cameron’s inheritance came mostly from money earned this way. Another to benefit is Chancellor Osborne who has £4.5m held offshore in a family trust.

Tory Party’s Money

Much of the Tory party’s money comes from people who operate these schemes. Lord Ashcroft, the top donor and fundraiser for the Conservative Party operates these offshore schemes. Now contractors and freelancers are enjoying the benefits of it too.

How they work is that most of the offshore umbrella companies and offshore schemes operate through loans. Because they’ve sent money offshore untaxed, i.e. the money they earn, that money is not taxable till they bring it back onshore. However, it never does.

Because they have that money offshore, the offshore umbrella companies that they operate through will loan them money back in lieu of that. They will then take that money back at the end to pay back that loan. Money loaned is not taxable.

Different Money Comes Back Onshore

Basically it is different money that comes back onshore than the money sent off. How they work is that he contractor receives loans and never pays them back as the offshore umbrella companies take the money sent offshore in lieu of those loans.

This is all completely legal. There is nothing HMRC can do about it as it is all framed in UK law. They would have to change the law to stop it and that is fraught with difficulties and would hit the Tory Grandees who basically pay for the Conservative Party.

Very Neat Scheme

There is one other scheme, which is quite neat, which one offshore umbrella company operates. They basically invest your money in a whole range of safe companies and send you loans in lieu of that money. You may even make a profit when you eventually quit the scheme and the only tax you would pay would be capital gains tax on the profits.

The beauty of it is that you can operate this through your own limited company and it would be invisible to your agency. See details of it here – Offshore Scheme using your Limited Company

To see details of these offshore umbrella companies see Offshore Umbrella Companies Directory

Tory Election Win Good for Offshore Umbrella Companies

Posted on May 25, 2015 by admin

Tory Election Win

Whoever you voted for, it has to be said that those who run, or use, offshore umbrella companies will be pleased at the Tory Election Win.

Labour had been threatening all sorts of things as regards offshore tax havens.Of course, this would have affected offshore umbrella companies.

Although David Cameron and George Osborne have also been threatening to do all sorts of things to people who use offshore tax havens. However, the press has usually prompted this after some new tax avoidance ‘scandal’.

Offshore Umbrella Companies

As we all know, it is the Government that sets the rules, including the tax rules. Companies are legally bound to maximise profits for their shareholders.

If that includes taking advantage of Government rules and schemes that is the right thing to do for their shareholders.

It might not be the right thing to do as far as the British taxpayer is concerned. However, it is the British Government who are elected to look after the rights of their taxpayers. Companies are put in place to look after the interests of their shareholders.

Governments shouldn’t complain if companies use offshore means to so this. After all they are only following Government rules. If the Government don’t like those rules they should change them. The Tory election win will delight the hedge funds.

Offshore Tax Havens

The astonishing fact is that half of the world’s trade goes through these offshore tax havens. Also, one-third of all the world’s wealth resides in these offshore tax havens.

When we tell you that most of these offshore tax havens are British owned or British Dependencies you see the real reason that Britain, and the Tories, don’t want to do anything about them. They will do as little as the press will allow them.

One of the first laws that Mrs Thatcher pushed through, when she came to office in 1979, was a law that meant that money moved out of the UK was no longer taxed.

That opened up the floodgates.

Don’t expect the Tory election win to change things too much.

Ian Cameron and Offshore Tax Schemes

David Cameron’s father, Ian, was one of the first to set up offshore schemes for people and companies. Indeed, David Cameron’s inheritance came from profits from these offshore schemes.

What about George Osborne?

He had to admit that he had a family trust offshore worth £4.5m. He said that, when the money comes back onshore, the right amount of tax will be paid.

It never will.

Loans in Lieu of Income

What happens is that people send their ‘income’ offshore and are given loans in lieu of it. They never pay the loans back. Loans are not retrievable after death. Eventually when the person dies, the loan disappears along with the obligation to pay it.

It was the wealthy hedge funds and rich individuals who use offshore schemes who bankrolled the Tory election win. Most of them have offshore addresses in British Dependency tax shelters,

He who pays the piper calls the tune. They wouldn’t expect to be punished for it after the Tory election win.

Offshore Schemes

The Conservative Party’s main fund organiser and donor, Lord Ashcroft, takes advantage of offshore schemes.

David Cameron spends much of his holiday time at Lord Astor’s, his father-in-law, estate in Scotland. This is owned from The Bahamas.

Of course, it does annoy them all when common or garden folk, like Contractors, use schemes like offshore umbrella companies.

Tax Avoidance Schemes

These tax avoidance schemes were not set up for ordinary folk to take advantage of.

However, there’s not much they can do about it as contractors are just following the rules set up by successive Tory Governments and taking advantage of them. They are just doing the same as the toffs and hedge funds after the Tory election win.

These offshore umbrella companies mean that UK contractors can keep 85% or more of their hard-earned money – and it is all perfectly legal.Cclick on Offshore Umbrella Company Directory to find out more information about offshore umbrella companies, or to apply to join one.

David Cameron’s Dad’s Offshore Money – Where Did it Go?

Posted on April 9, 2015 by admin

David Cameron’s Dad’s Offshore Money

What happened to the offshore money built up by David Cameron’s Dad?

One of the first things that Mrs Thatcher did, when she came to office in 1979, was to change the laws so that money leaving the UK was untaxed.

This set off a whole load of offshore money-making schemes for Tory Grandees and party contributors such as Lord Ashcroft, who was the Tory party’s main contributor, and Lord Astor, David Cameron’s father-in-law.

Another of these was David Cameron’s father Ian using his Blairmore vehicle.

Offshore Umbrella Companies for contractors to save tax

Ian Cameron – No UK Tax

For 30 years Ian Cameron was setting up offshore schemes that meant his customers would not pay UK tax.

He also invested his own money in tax havens.

In all that 30 years he never paid any UK tax on the offshore money.

You would have thought that he had many millions.

Ian Cameron’s Worth

How much do you think that someone, who had spent 30 years helping people shelter from UK tax, and paying no UK tax for 30 years on his own offshore income, would be worth?

I would have guessed he would be worth many millions, perhaps in the tens of millions and maybe even in the hundreds of millions.

So what did he leave in his will?

David Cameron’s brother got a house out of it. David Cameron, himself, got £300,000 and his sister got some money as well.

That strikes me as being a piffling amount of money for a guy who had been helping others avoid UK tax for 30 years and who had paid no UK tax on his own offshore money for 30 years.

Ian Cameron’s Money

So, what happened to all the money that he must have made?

Paying UK Tax

It’s possible that he gave it to his children to avoid death duty before he died.

It’s also possible that it is still out there in offshore funds in places like Panama, Jersey, the Bahamas etc.

As there is no revelation, no one would ever know.

We only know, because of a firm of lawyers being hacked in Panama, that David Cameron sold shares in an offshore trust in 2010, before he became Prime Minister, for £31,500 – a profit of £19,000.

No Capital Gains Tax on Offshore Profits

Although he paid dividend tax in the income he got from it, he didn’t have to pay any capital gains tax.

It’s now been discovered that there were another couple of companies in which he had shares that were held offshore.

None of this would have been known without the Panama lawyers being hacked.

Downing Street Statement

Downing Street first said that Cameron had “no shares, no offshore trusts, no offshore funds”.

Later this was clarified to: “The prime minister, his wife and their children do not benefit from any offshore funds.”

Later again Downing St said that there were “no offshore funds or trusts the family would benefit from in future.”

That left wiggle room about the past.

Contractor Tax Avoidance sches on Isle of Man

Contractor Tax Avoidance schemes

Where’s the Money?

So, what did happen to all the millions that David Cameron’s dad must have made?

Why did he leave such a relatively small amount of money to his children?

Did he manage to give them it before he died?

Was he spectacularly unsuccessful over 30 years in a field where making heaps of money seems to be easy?

Or are there other offshore trusts out there, in other tax havens, that only David Cameron and his family know how to get hold of?

In recent years UK contractors have been taking advantage of measures, both offshore and onshore, to minimise their taxes, just like David Cameron’s dad Ian, David Cameron, George Osborne, Lord Ashcroft and Lord Astor.

What’s sauce for the goose is now sauce for the gander.

For an explanation of those tax minimization opportunities for contractors, where they can keep up to 90% of their money, see Onshore and Offshore Umbrella Companies List.

Offshore Tax Avoidance – Why the Government doesn’t Stop it

Posted on April 8, 2015 by admin

Offshore Tax Avoidance

Many people, including contractors are bemused by the fact that the Government doesn’t just stop Offshore Tax Avoidance schemes completely.

“Why don’t they just shut them all down?” they ask. Why don’t they just get in touch with the people and say “You owe us a whole load of tax?”

The answer is that they can’t.

Don’t Break UK Tax Law

Top Umbrella Companies offshore and onshore

Top Umbrella Companies for returns

They don’t break UK laws. Indeed the offshore umbrella company schemes are designed to fit in with UK law. It may not be in a way that the Government intended, or wanted, but they do comply with UK tax law.

That’s why it is legal tax avoidance rather than tax evasion.

According to HMRC’s Commissioner and Director General for Enforcement and Compliance, Jennie Granger, “There is nothing illegal about an international structure, especially in a globally integrated economy and these arrangements may be particularly legitimate”.

Legal Tax Avoidance

International tax law expert, barrister Jonathan Schwartz said “All laws influence and tax laws are no different. The tax behaviour of companies is largely driven by the tax systems they engage with.

“Tax administrators must apply the law as it exists rather than what they, or anyone else, might think it ought to be”.

That’s exactly correct. Those who run offshore tax avoidance schemes design their solutions to fit in with current UK law.

Change Tax Laws Back

Of course, the Government could change the laws back to where they were before – but they don’t want to do that.

They make those laws for a purpose. They may want to bring more film companies to Britain or to support the burgeoning UK music industry. They give tax incentives for film makers or music producers to operate from the UK.

Offshore Schemes for UK contractors to save tax

It does do that – but it also opens the door to those who want to use this for tax avoidance.

Offshore Umbrella Company Loans

Then there is the fact that, in many offshore tax avoidance schemes like offshore umbrella companies, the money is sent offshore untaxed and stays there.

The offshore company gives the contractor a loan in lieu of the money.

That loan money is never paid back so the offshore company keeps the money sent offshore in lieu of it.

So, what should the Government do about it? Make loans taxable?

Think what would happen to the banking system then or to the City of London and all the commerce that goes on there.

Upholding the UK Tax Laws

As tax expert Jonathan Schwartz said “Tax administrators must apply the law as it exists rather than what they, or anyone else, might think it ought to be”.

The courts must do that also. It’s Government that makes the laws. It’s the duty of the courts to apply those laws.

The Government may fulminate against offshore tax avoidance but it is they who create the laws that allow it.

Money Leaving UK Untaxed

One of the first things that Mrs Thatcher did when she came to power was to bring in a law that allowed money to leave the UK untaxed.

Many Tory grandees have taken advantage of this to send their money offshore untaxed. This includes David Cameron’s father Ian, his father-in-law Lord Astor and the Tory party’s main funder, Lord Ashcroft.

Paying UK Tax

It also includes Chancellor, George Osborne, who has a £4.5 trust offshore. He says he will pay the appropriate tax when it comes back onshore. However, it never will. It was sent offshore in the first place to avoid UK tax.

Margaret Hodge and Stemcor Tax Avoider

The hammer of the offshore companies, and big companies who avoid UK tax, is Margaret Hodge, a Labour party MP who is in charge of the Public Accounts Committee in Westminster.

However, it was revealed that she owns part of an offshore company called Stemcor, which her brother runs, and that her stake is worth a million and saved her 50 grand in tax annually.

Of course, the Government could reverse Margaret Thatcher’s tax law and make money that leaves the UK taxable.

What would that do for British business and the City of London, and the Tory grandees, income streams?

Offshore Tax Avoidance Schemes to Continue

So, the Government may fulminate against offshore tax avoidance schemes every time they are ‘exposed’ in the press. They have to do that.

What they are not going to do is make money that goes offshore taxable again or to make loans subject to tax.

So, offshore tax avoidance will continue as long as the laws of the land allow it – and courts will continue to rule that loans are not taxable.

For a list of hose companies who operate offshore (and onshore) tax avoidance schemes click on Offshore Umbrella Companies List

Crushing HMRC defeat in Rangers offshore tax case

Posted on July 10, 2014 by admin

HMRC Defeat

There was a crushing HMRC defeat in its appeal against Rangers football club’s use of offshore Employee Benefits Trust (EBTs) to pay its players. There was a major HMRC defeat in the original case by 2-1.

HMRC said that these were payments rather than loans. The First Tier Tribunal (FTT) said they were loans. HMRC lost.
The case, and the tax said to be owed, was a major in bringing down Rangers Football Club.

HMRC Appeal

It was a crushing HMRC defeat but they quickly decided to appeal. They have now lost that appeal. The tribunal judge Lord Doherty ruled against HMRC and in favour of Rangers. It confirms that the EBTs and offshore umbrella companies were completely legal.

This HMRC defeat will have major consequences. Tory Grandees, including David Cameron’s father, his father-in-law, Lord Astor, and the Tory Party main sponsor, Lord Ashcroft, have long used these schemes. George Osborne has an offshore family trust.

However, they didn’t like it when this nice scheme spread to the likes of actors, pop artists, footballers and comedians. Nowadays, contractors and freelancers us them. Many of them are in offshore umbrella companies.

Sleep Safely

Now, after this huge HMRC defeat, freelancers and contractors who use offshore umbrella companies can sleep more safely in their beds at night.

A spokesman for Murray International holdings (MIH) which owned Rangers and made the offshore payments to players said:-

“We are pleased with the judgement. It again leaves negligible tax liability. It overwhelmingly supports the views collectively and consistently held by our advisers, legal counsel and MIH itself”.

Rangers were forced into liquidation in 2012 by HMRC.

Rangers Update

HMRC appealed this case again and won. Rangers are now going to appeal that to the Supreme Court.

More Info

For a list of Offshore Umbrella Companies for Contractors click on Offshore Umbrella Companies List

Offshore Umbrella Companies and how they work

Offshore Umbrella Companies Boosted by UK Government

Posted on February 8, 2013 by admin

Offshore Umbrella Companies Boosted

We have now got offshore umbrella companies boosted by the UK Government.

The UK Government is inadvertently boosting them by their attacks on freelancers’ use of Personal Service Companies. The UK Government appear to want freelancers to get out of Limited Companies and get into Umbrella Companies. The UK Government can then grab more income tax and National Insurance Contributions from them.

Although, to a certain extent they are managing to do this, more and more fish are escaping their nets and slipping into the offshore umbrella companies net. This means that the Government will get very little tax at all from them if any.

Legal Offshore Companies

Most of these schemes are completely legal. The freelancers’ money goes to the offshore umbrella company as an investment. They get back a loan in lieu of the investment. They use the investment as collateral.

One such scheme has the freelancer’s money paid as an investment. This is then invested in a broad spread of 150 telecoms companies. They insure the investment against loss. Therefore, as they insure the investment against loss the offshore umbrella company is able to loan money to the contractor in lieu of that investment.

When the contractor wants to cash in the investment he, or she, will get any profit from the investment in the telecoms companies. All they will pay is Capital Gains Tax on any profit they have made.

Conservative Party

Of course, this is all completely legal. The Conservative Government knows that as it was they, under Margaret Thatcher, who legalised it in 1979 within a month of coming to office. Perhaps it was payback time for their sponsors.

A number of Tory Grandees have used it successfully. They include David Cameron’s father Ian, Lord Astor his father-in-law, Lord Ashcroft the Conservative Party’s main donor and fundraiser. Of course, the Chancellor himself, George Osborne has a family trust of £4.5m offshore.

IT Contractors

Of course, these schemes were never meant for the likes of IT Contractors and other freelancers. However, they cannot just exclude IT Contractor from this tax avoidance gravy train. If they stopped it they would be cutting off their noses to spite their faces.

So, contractors are happy to see offshore umbrella companies boosted by the Government.

Check out our Which Umbrella Company guide and our Which Contractor Accountant guide.

Offshore Schemes have Government foaming at mouth

Posted on February 1, 2013 by admin

Offshore Schemes

The Government has fulminated about offshore schemes where big companies are able to avoid paying tax in the UK. David Cameron has criticised ‘clever accountants’ who set up these offshore schemes for their clients to avoid paying UK tax.

Margaret Hodge of the Public Accounts Committee has attacked the big Accountancy companies for setting up these schemes at a Public Enquiry.

However, one wonders who should be in front of this Public Enquiry, the big Accountancy companies or the Government. After all, it is the Government who are in charge of the law. The big Accountancy companies just follow the laws that the Government set up.

Offshore Schemes for UK contractors to save tax

Thatcher Government

Perhaps the Committee should investigate members of the Thatcher Government. The Committee could ask them why one of the first pieces of legislation they put through in 1979 after being elected was to allow people to send money offshore without it being taxed. Why was that so urgent?

There’s a lot of talk also about trying to shame companies like Starbucks into paying more tax than they legally have to.

Perhaps they should put David Cameron in front of the Committee to ask him if he would hand over to HMRC a big chunk of his own inheritance which came from the offshore schemes set up by his father Ian, who was one of the early practitioners of such schemes.

George Osborne

Perhaps they can bring Chancellor George Osborne before the Committee. They could ask him if he would promise to that he and his family will pay not just the tax that they have to but the amount of tax that they would have had to do if their £4.5m family trust has been set up in the UK rather than set up offshore.

Contractor Tax Avoidance schemes

So, the problem for the Government is that these offshore schemes are mainly used by their supporters and backers. There’s not a huge amount of Labour backers with offshore trusts.

These offshore schemes are used by people like David Cameron’s father-in-law Lord Astor and the Conservative Party’s main sponsor and fundraiser Lord Ashcroft. However, it was Margaret Thatcher’s Conservative Government who brought in the laws allowing people to send money offshore untaxed.

Multinational Companies

What they don’t appear to like is multinational companies getting a slice of what was set up just for the upper and business classes in Britain to avoid paying UK Tax. The upper and business classes in Britain have been taking advantage of this for more than 40 years. However, they are now outraged that companies like Starbucks, IBM, Google and Microsoft are using them.

What really annoys them is that freelancers, many of them in IT, are using offshore schemes to avoid UK tax. IT Contractors mainly come from the middle and working classes. They didn’t set these laws up for them. So, will Cameron and Osborne change the laws which have helped their supporters and sponsors for many, many years – or is this just a knee jerk reaction to a media frenzy.

We shall see. For the moment these offshore schemes remain perfectly legal.