Tag Archives: Contractor Tax Advice

Contractor Tax Advice
Contractor Tax Advice | UK Contractors can avoid UK tax by joining offshore umbrella companies based in the Isle of Man. They can retain 85% to 90% of their earnings this way.

This is much more than if they went through an onshore PAYE umbrella company where their returns would be 60% to 65%.

[caption id="attachment_503" align="alignnone" width="225"] Contractor Tax Advice on umbrella company alternatives[/caption]

 

Offshore Umbrella Companies returns for UK Contractors

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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.

Rangers Tax Case – HMRC accused of bringing them down

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Rangers Tax Case

Rangers Tax Case

Rangers Tax Case – a former owner has accused HMRC of bringing a great football club, Glasgow Rangers, down via a spurious tax claim against them.

HMRC demanded more than £46m from Rangers after they used offshore Employee Benefit Trusts (EBTs). HMRC lost the Rangers tax case in a 2-1 verdict at a First Tier Tribunal in November 2012.

So, they decided to appeal it. The judge has now thrown that appeal out too.

EBTs for UK Contractors

HMRC said that Rangers were using EBTs to pay top players salaries. However, the tribunal and then the judge said that the money given to the players were loans.

Now, former owner, David Murray, said that the tax demand was instrumental in Glasgow Rangers being liquidated.

He said that the case hanging over the club caused the market to have a lower perception of the value of the club.

Bought by Craig White

Eventually Craig Whyte bought the club for just £1.

Rangers Tax Case

Rangers Tax Case from Rangers football club

He would have to pay the debt of £18m to Lloyd’s Bank as part of the agreement. Unfortunately, he financed that out of future season ticket sales.

As a result of Rangers not making it into the group stages of the Champions League and Rangers season ticket income already being spent, they got into tax and VAT trouble. So, they went into administration and then liquidation.

Rangers Enquiry

Now David Murray wants the Government to start an enquiry over the Rangers Case and how HMRC acted. It seems that Rangers offered HMRC a substantial amount of money to settle the case but turned it down.

Rangers tax case and their defeat could have huge ramifications for HMRC. They were using Rangers as an example.

It’s estimated that there are 5000 other companies using this route, including a number of top English football clubs.

So, a win for HMRC in the Rangers Tax Case could have produced a huge windfall for HMRC.

However, defeat in the Rangers Case has now caused them a lot of trouble amongst football fans and club owners. There will be a backlash against HMRC.

Rangers Supporters Club

According to a Rangers Supporters Club the Rangers tax case has caused a lot of pain to Rangers. They said “Rangers Football Club and its fans have been the victims of a witch-hunt by HMRC. It has done tremendous damage to a proud Scottish institution.

“Why did HMRC continue with this spurious claim when they were offered settlement? We deserve answers as to why this was done to our club”.

It was revealed, last year, that HMRC had come to settlement with many major firms. They were panned for it.

Therefore, the Rangers tax affair could still up a whole can of worms for HMRC. Football fans are not to be trifled with.

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

Rangers Update

HMRC appealed the case again and won it. Now Rangers are going to appeal to the Supreme Court.