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UK Offshore bank accounts

Discussion in 'Business & Tax Advice' started by jaremore7, Jan 25, 2010.

  1. jaremore7

    jaremore7 Registered Member

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    Hi guys!

    Here I'm just sharing a thought.

    We all know that the UK is beautifully surrounded by 3 smaller set of islands that are not part of the UK per se, not part of the EU, and that have tax free banking (Isle of Man, Jersey and Guernsey) - Offshore banking

    Since in the UK you are only supposed to declare income that is produced in the UK or brought into the UK....... could someone that lives in the UK be paid by american companies into those offshore bank accounts? As long as you don't physically bring that income to the UK you wouldn't have to pay taxes on it..... but you could use debit/credit cards linked to those bank accounts to pay for goods while on the UK.

    I know the hard part is opening those bank accounts, but if you manage to open one, you could just put there all your Internet Marketing income, and avoid paying taxes in the UK.

    Anyone doing this? Anyone with some knowledge about this?

    Regards my friends!!!
     
  2. clopper

    clopper Regular Member

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    Sounds like if you withdrawl it from cards and use the money in the UK then you are still liable for taxes for it. You are just changing the means of delivery and hoping there is no reporting. I guess if you can duck the authorities then you're golden,
     
  3. savvypro

    savvypro Regular Member

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    @jaremore7

    I'm also in the UK - I've talked to my accountant about something similar.

    Bottom line is, the tax man is not going to like what your doing.

    If you can bring the money into the "UK" as a foreign resident then you can pay a one off tax every year. Sounds good in theory, only problem is that the one off tax is £30,000 a year.
     
  4. iglow

    iglow Elite Member

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    u simply use the card to pya for stuff liek food etc and dont pay taxes. but to buy home/car ull need to get money on urself with taxes
     
  5. jaremore7

    jaremore7 Registered Member

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    Thank you all for delivering interesting answers guys!

    I'm meant to meet a Financial Advisor in a few weeks, but the anticipation was killing me and that's why I ask now.

    For what I understand, the only "gray" area in all of this would be using that money on the UK(iglow points that if you just use it to pay for food and small stuff like that that doesn't need to be registered, you will be fine).

    So we can be 100% sure that I'm a European citizen resident in the UK and I put all the income from the affiliates in Offshore accounts, and I DONT use that money at all in the UK (I just keep saving money and not using for any means in the uk) I will not have to pay any taxes at all. Is this right?

    Thanks again for your help guys!
     
  6. savvypro

    savvypro Regular Member

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    You may not tell anyone, but every transaction is registered ;)

    What ever you do - if the money is in your name, your going to end up paying taxes.
     
  7. jaremore7

    jaremore7 Registered Member

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    Are you sure about this? I mean, do you know the current fiscal legislation for the UK? I believe that income generated abroad that you do not bring to the country you don't have to pay taxes.

    For example, if I go to the Dubai while still being a UK resident, and I do some business there, I do not have to pay taxes nor in Dubai neither in UK as long as I don't bring the income to the UK or (buy anything with that money)
     
  8. Animal888

    Animal888 Newbie

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    As I understand it, all UK domiciled residents are required to remit returns and pay taxes on their worldwide income. You get a tax credit where you have already paid taxes in other countries, but you still pay equivalent full UK tax.

    If you're not UK domiciled, then you must spend at least 6 months of every year out of the UK and even then you are likely to be flagged for investigation if you are right on that limit for several years in a row.

    The IR are not renowned for limiting their investigations in terms of cost effectiveness - they may spend hundreds of thousands persueing you for tens of thousands...

    If you're going to try this, at least be a little clever about it... form an offshore company with nominee directors. So long as you don't draw attention to yourself, you may get away with that while holidaying abroad on the company expenses :)

    I should add, that this is not legal or tax advice in any way, shape, or form :)
     
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  9. jaremore7

    jaremore7 Registered Member

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    Thank you very much animal!
    That's the kind of answer I wanted to read!!

    Do you recommend Gibaltrar for incorporating then? I've seen many different online companies that offer that kind of thing....but most of them look dodgy as fuck!!!!
    Do you know any reliable company that offers this kind of service?
     
  10. oxonbeef

    oxonbeef BANNED BANNED

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    I think everyone should carry a tax payers card.
    House burning down? "sorry you ain't paid your tax"
    Need casualty? " sorry ain't paid your tax"
    Kids need educating? "sorry ain't paid your tax"
    And the list goes on.
    How can you expect to be part of a civilised country without contributing?
    Pay your taxes or leave the country.
     
  11. chocolatemonkey

    chocolatemonkey Junior Member

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    "avoid" means tax evasion. i wouldnt get into that realm of possibility if i were you. spending it in the UK, plastic or not, is bringing it in, period
     
  12. clopper

    clopper Regular Member

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    IDK man, if taxes were 5% I would pay them gladly. The check would be in the mail every week. But when the governments start taking 30-40% of what you make you begin to look for ways to get around it. Top tax rate in the US was 90% at one time. Kinda like, hey, lets JV but I'll be taking 90%.
     
  13. BLACKHAT1984

    BLACKHAT1984 Regular Member

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  14. oxonbeef

    oxonbeef BANNED BANNED

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    Well if he set up his business right his company could purchase those as a
    business asset and could pay himself a wage beneath the higher tax threshold.
    What he should be looking at is forming an offshore company and having all
    assets owned by the company.
    There is a big difference between tax avoidance and tax evasion.
    Best person to ask is an offshore accountant. Also forget Jersey Guernsey or IOM, look at Belize or panama But they'll get you anywhere if you peep above the radar.
     
  15. Animal888

    Animal888 Newbie

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    I'm out of date with the legislation, but as far back as the early 1990's transactions at a known tax haven would raise red flags. I would use a delaware corporation or similar. After all you'd be in good company with the likes of AmEx :)
     
  16. dotcomdesigns

    dotcomdesigns Power Member

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    As already stated if you are a uk resident then you have to pay taxes on all income wherever it is earned. One way around this is to change your place of abode but that will limit your time in the UK to about 90 days a year max.

    I have been caught by the tax man here in the UK. A few years ago I was making some serious money through an affililate business in the USA. They obviosuly paid from the US. I opened an offshore bank account, paid half into the offshore account and half into the UK account and declared on the money coming into the UK. I had property overseas too and lived there 3 months of the year.

    The British government have been putting offshore and foreign banks under a lot of pressure to give up information about British citizens with accounts. My offshore bank gave them everything.

    I received a notice of investigation out of the blue in 2007. Last year the tax man made me bankrupt. I lost pretty much everything by not doing my research. I got a 40% penalty on what I owed plus 6 years interest on the amount. Although I managed to pay the tax owed, the interest and penalty bankrupted me.

    Seriously, you mess with the tax man and he will destroy you.

    They told me that they have names of every individual who has had an offshore account in the last 20 years. They are coming for every one. They said it will take possibly 10 years to chase every one down. The ironic things is it's costing more to catch people than the amount of unpaid tax they are recovering.

    Do you know the tax man is offering bribes to people working in Swiss banks for information on UK residents!

    You know if I had changed my place of residency I wouldn't owe them anything!

    Go to G00gle and search for offshore amnesty uk and you can read about the offshore account purge by the tax man in the UK
     
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    Last edited: Jan 25, 2010
  17. oxonbeef

    oxonbeef BANNED BANNED

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    It is a sad fact that the people who benefit the country the most in the way
    of commerce, trade and bringing revenue into the country are penalised the most.
    Perhaps if they changed the system to where the lowest earners were taxed the
    highest it might kick there asses into doing more.
     
  18. savvypro

    savvypro Regular Member

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    I was referring to the transactions in the UK - you can thank the terrorism laws put in place since 9/11


    Not quite.

    Avoidance is some what legal, in that you can do everything that's legal to avoid paying higher tax’s - think deductions, expenses and loopholes if and when you can find them.

    Evasion is where you go out of your way to not paying any tax. This is what’s illegal.


    They always bring up off shore this and off shore that every now and then to try and scare people. It would be interesting if they told the public the truth, that the UK its self is one of the biggest tax havens on the planet.

    Every now and then the OECD puts out a report about how bad low/no tax jurisdictions are and call for higher taxes and more regulation. But in all other industries and areas they call for less regulation and lower tax's.

    Plus you have a little inconvenient issue, everyone who works for the OECD doesn't pay any tax. But they like to lecture everyone else about how they shouldn't avoid/evade paying tax's.


    As I said above:
    What ever you do - if the money is in your name, your going to end up paying taxes.

    The important bit’s are: your


    Actually IOM is a good place to setup a company, one of the company structures available (can't remember which one) has the option of being made a tax exempt company for a annual fee of just £300.

    ....

    There is a lot more to the "going offshore" than what's been explained in this thread, and from what I've read in this forum, there is a lot of bad misinformation so be careful.


    Remember: I'm not an accountant or lawyer, and don't play either on TV
     
  19. BLACKHAT1984

    BLACKHAT1984 Regular Member

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    <<It is a sad fact that the people who benefit the country the most in the way
    of commerce, trade and bringing revenue into the country are penalised the most.
    Perhaps if they changed the system to where the lowest earners were taxed the
    highest it might kick there asses into doing more.>>

    With all due respect this is nonsense in the UK. I'm technically a minimum wage earner. If I wasn't a net-repreneur I'd be in hell. Monthly wage is like £900, I get taxed loads on that plus I get £120 council tax, water tax etc. The top earners should get 50% taxed but none are silly enough to have money in UK accounts. The problem isn't in the taxes being collected from the wrong people; the problem is in the ridiculous UK benefits system. Someone downstairs from me earns TWICE my wage just from being an ex-heroin addict and claims to suffer from depression etc. A lot of foreign workers are even allowed to claim National Insurance from the UK while living and working abroad.

    The government should open its eyes instead of sitting on its ass.
     
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  20. adam.jn

    adam.jn Regular Member

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    Not that I dislike foreign people, but I heard of a foreign family in Northern Ireland, UK, they make £35,000 each year from claiming benefits, don't work, don't pay tax, got there house bought for them by the government.... the world is messed up big time. Everyone should have to work for everything, with a few exceptions. Just my view on things.