Newbie - offshore scheme question

[fatsuperman]

Hi everyone,

Next week I'm starting my first contract for a decade, I'm currently with a 'generic umbrella' and have been speaking to a friend who is also contracting.

From what I can tell, he has a very cavalier attitude to tax and for around 12 months I believe he was self-employed and didn't bother paying tax (he says he'll "pay the bill 9 months after year-end"). Recently he told me "he's offshore now" and recommend I get involved.

Clearly this is someone I shouldn't be taking advice from, however I thought I'd have a browse here for info on these schemes - couldn't turn up much. Can anyone give me an overview of how these work and the risks involved?

Much appreciated!
Fats

[northernladuk]

Seriously, walk away.

When he goes to jail on a whole raft of finacial issues are you going to post a question about how prisons work?

They often don't work and the risks are very high.

You say you won't take advice from him but you are considering his methods. Surely this is even worse?

Sounds like a car crash waiting to happen to me.

[Jet Setter]

Self employed offshore schemes don't work. Steer clear. Sending the money offshore doesn't make a difference if you earn the money here. EBT schemes use offshore locations but tax is being paid here, but HMRC don't like them.

Ask to see any supporting material that the company might have, then you can make a relatively informed decision. Don't take anything from mates or anyone else at face value.

[TroubleAtMill]

Hi everyone,
...
Clearly this is someone I shouldn't be taking advice from, however I thought I'd have a browse here for info on these schemes - couldn't turn up much. Can anyone give me an overview of how these work and the risks involved?

Much appreciated!
Fats

WTF?? Seriously?? I'm limited (in more ways than one) but even I couldn't miss the many, many, many posts about offshore schemes.

[sweetandsour]

Are you sure that you couldn't find any threads on the topic in this very forum?

http://forums.contractoruk.com/accou...al-review.html

http://forums.contractoruk.com/accou...g-problem.html

http://forums.contractoruk.com/accou...ce-scheme.html

http://forums.contractoruk.com/accou...as-victim.html

http://forums.contractoruk.com/accou...y-reviews.html

It is possible that one or two of these is not an offshore scheme, but you should take a way a general impression about the use of "schemes".

[ChimpMaster]

Awww go on then Fatty, tell us which scheme it is and why we should all get involved etc etc.

[cojak]

Good grief - there's one born every minute..

http://forums.contractoruk.com/accou...ghlight=scheme

[fatsuperman]

Hi peeps,

I understand there is a lot of spam here, but I was genuinely asking the question. I'm not simply taking my friends advice, hence why I'm PAYE under an umbrella and I expect that will suit my needs for the time being. However I thought I'd ask some people with actual experience in this just to see if I was missing a trick - nothing more sinister than that! (Bet that's what a spammer would say as well though)

Tazman: I don't know the company he's with so I can't comment on it, I suspect he knows the barest information about it.

Sweetandsour: Thanks for those links, I'm looking through them now I searched for 'offshore scheme' and 'offshore' and didn't find these - most references I got were about genuine offshoring or people working outside the UK etc.

Thanks again,
D

[cojak]

OK then Fatty, we'll cut you some slack

Just go LTD - you know it makes sense.

[Maslins]

I'd steer clear of the offshore schemes, unless you're prepared to spend loads on legal/accountancy fees, and still spend your time looking over your shoulder.

Limited Company route still tends to be the best under most circumstances. If you're outside IR35 it's by far the best of the mainstream options. If you fall within IR35 it's still marginally better (taxwise) than an umbrella...but not significantly so, so I can understand why many who would be caught choose to stick with the umbrella.