Need rid of my accountant fast...Any good ones for under 50/pm

[Danielsjdaccountancy]

Hey, I'm happy to agree to disagree on this one. Always love a good debate.

This thread has proved that we don't advise or advertise income shifting but we are more than happy to assist clients should they choose to do it.

As I said before I have clients I have helped share split.

[Mr.Whippy]

This thread has proved that we don't advise or advertise income shifting

Has it? did you not read my post?....

I was advised to split shares by SJD and also advised that I should pay my non-working spouse a salary just for the purpose of using up her tax allowance despite me expressing concerns that she wouldn't actually be doing any work to justify a salary.

[TheFaQQer]

Yes, it was discussed at length in this thread. Considering that income splitting is backed up by a high profile precedent set by Jones v Garnett in the House of Lords, I think it would be very unlikely for the government to retrospectively change the law. Certainly if it did, they would cause a lot of tulip to hit the fan in the House of Lords as they would effectively be trying to quash the judgement of the highest court in the land by legislating retrospectively.

Even if hell freezes over and they did legislate retrospectively, what is our exposure? We would have to pay up the tax that we avoided (plus interest). That's a gamble that I'm willing to take. If they were going to come after contractors then the attack would be much more likely to be via IR35 than attacking what will very often be "family businesses" for income splitting.

The potential backlash for respective legislation on this one makes it a no-brainer, IMHO. The prospect of hitting every small business in the country with a retrospective tax bill isn't one that any government is likely to pursue.

When the last government considered the Family Business Tax, there was enough uproar about it to shelve it (temporarily at least). Trying to make a new law retrospective is doomed to failure.

[Danielsjdaccountancy]

Has it? did you not read my post?....

I was advised to split shares by SJD and also advised that I should pay my non-working spouse a salary just for the purpose of using up her tax allowance despite me expressing concerns that she wouldn't actually be doing any work to justify a salary.

II did read your post, yes. The salary I have no problem with.

Regarding the dividend I can't really comment on why your accountant advised this, our website and material certainly don't advise it.
Please can you PM their details and I’ll speak to the individual to see the reasoning behind their advice.

Thank you

[ASB]

"Does it feel right that someone contracting through a LTD company can pay no National Insurance at all but still get a credit towards their state pension?"

Yes, it does actually. This applies to everybody irrespective of their situation.

"Does it feel right that a contractor with a non working spouse could pay just 20% tax on £100k/year income? Common sense says no it doesn't. But we are talking about the law, not common sense and this is perfectly legal and people do it."

No it doesn't; being able to recategorise what is quite evidently personal income into investment income is simply "wrong". It doesn't feel right either that you can claim expenses for "going to work" whereas I can't.

I have always felt the environment a contractor can operate in as "unfair".

Though for the 25 odd years I was contracting I used every rule in the book (and according to HMRC some that weren't) to maximise my take. Quite what I did depended on the regime at the time, but it was most certainly permanently arranged to my benefit. The fact that I found the system "odd" is no barrier to using it. After all tptb always had the option of changing it.

Taxation is levied by statute, not an individuals personal view.

[d000hg]

I certainly agree that income splitting 'feels' wrong and that HMRC 'don't like' it. If you treat the tax system as a bit of a game - find loopholes and use them until they are closed off - then fine. But the BN66 thing has made this appear a lot more risky, with the government showing that retrospective changes are tenable.

No accountant wants to find a large % of their clients are investigated - even if they all survive unscathed - because the majority are more conservative and would see this as a warning flag about said accountant. Hence they are cautious unless you want to push harder.

Mentioning past court cases doesn't really help if HMRC come after you unless you have insurance against it... in which case sail close to the wind but make sure the insurance from PCG (or whoever) really DOES cover you.

[Wanderer]

I certainly agree that income splitting 'feels' wrong and that HMRC 'don't like' it. If you treat the tax system as a bit of a game - find loopholes and use them until they are closed off

That's the thing though. People talk about "loopholes" with all the negative connotations regarding tax evasion but when does something stop being a "loophole" and start becoming generally accepted tax planning? To my mind, if the government knows full well about a tax avoidance measure and takes no action to prevent it then it is obvious that that type of avoidance is OK.


Many businesses are subsidised in one way or another, farmers, big businesses with non-dom directors etc. Perhaps the tax breaks that the government allows for contractors is the same thing in order to encourage a pool of skilled, motivated, flexible workforce which is good for the economy in general so they allow the tax break for those of us who choose this career path.

No accountant wants to find a large % of their clients are investigated....Hence they are cautious unless you want to push harder.

A good point. If you had an accountant who was full of aggressive tax planning advice then I guess HMRC could smell blood and say to them "Right, give us a list of all your clients, we're going to investigate the lot".

So what we really want is an accountant that gives the most conservative advice to their clients so they stay off HMRC's radar but instruct them to engage in some aggressive tax planning on your behalf.

[prozak]

That's the thing though. People talk about "loopholes" with all the negative connotations regarding tax evasion but when does something stop being a "loophole" and start becoming generally accepted tax planning?

Its not evasion if you don't get caught.

[Fred Bloggs]

Sharing the risks of contracting and the dividends that result with your spouse isn't a "loophole" in any way, IMO. Until about 7 years ago the governments own business websites used to actively encourage married couples to structure businesses that way. Oh how I wish I'd save the web pages, now it would be like reading a web page from another planet given how the political/taxation landscape has changed in that time.

[simondolan]

Its not evasion if you don't get caught.

Avoidance used to be acceptable. The Govt have been using the words evasion and avoidance in the same breath for a few years now to the extent that avoidance is now seem in the same light as evasion. Thinking about it, they don't even seem to refer to evasion anymore - just avoidance.