Trust-based Tax Planning (Contractors)

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stmoo

stmoo

Midfield
Any of you contractors looked into this for when the new directors' dividend rule comes in in April?

I've read a few bits and pieces but I still don't understand it but the "sales people" are telling me I will take home shitloads more cash which is obviously tempting.

Can anyone explain it in plain language for me please?
 


stmoo said:
Any of you contractors looked into this for when the new directors' dividend rule comes in in April?

I've read a few bits and pieces but I still don't understand it but the "sales people" are telling me I will take home shitloads more cash which is obviously tempting.

Can anyone explain it in plain language for me please?
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Sales people: help set it up and take a commission slice

You: End up in the 'Big house', bitching :D
 
sketchy said:
Isn't this what that channel 4 programme this week was about? How the rich avoid tax
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Aye. First bloke who was on appeared to be selling trusts. The idea is that you claim a deduction for paying money into a trust, then borrow the same amount from the trust itself.

From a legal perspective you're allowed to pay money into a trust and claim it as an expense (if it's for business reasons) and by borrowing the same amount from the trust there's a liability to set off in future. That link I posted had a quote from the same barrister who was on that programme suggesting that the Rangers decision might mean the end of these sorts of arrangements.
 
Epping said:
I'm just through an umbrella at the moment so no substantial advantages. Simplicity and ease of getting my dosh
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Yeah - I'm doing this at the minute.

I did have a limited company but the corporation tax sitting in the bank account was too much of a temptation. :neutral: :lol:

This scheme seems to be giving yourself a 10-year loan from a trust at low rates and then letting it renew every ten years till you're dead, thus never paying tax.

Sounds a bit dodgy but who isn't tempted by a loophole? ;)
 
Both the company CT600 tax return and the individual SA100 tax return have a nice little box which you must tick if you are using tax avoidance planning / products. Do so and an enquiry will eventually be opened. Failure to disclose and HMRC will nail your bollocks to the wall.
 
garyswc said:
Both the company CT600 tax return and the individual SA100 tax return have a nice little box which you must tick if you are using tax avoidance planning / products. Do so and an enquiry will eventually be opened. Failure to disclose and HMRC will nail your bollocks to the wall.
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Suspected as much. Cheers.

I'll just stick with what I've got then.
 
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