Anyone ever used a company called Darwin using an offshore trust

[Mozart]

Just about to go contracting again after a long hiatus and lookiing at all the various options available. Back in the pre-IR35 days, I managed to get a lot more take home and Darwin seems to be offering similar but its using a trust based in the Isle of Man. Its not an employee benefit trust though but reading item 5 in the HMRC spotlight gives me the heebie jeebies about using such a scheme. Ideas? Thoughts? Comments? Thanks

[northernladuk]

Have you ever thought about using a search button rather than just logging on and hammering keys? Researching dodgy schemes where your money is involved should amount to a little more than asking a question on a board that has been asked many times before IMO

[Gonzo]

Here's where they have been discussed twice in the last three months

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

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

I appreciate that searching for "Darwin" on this forum will bring up loads of references to the Darwin awards because the people that use this forum have a low tolerence for stupid people, but FFS, how hard is it to search?



EDIT: Bollocks, I am not supposed to be posting in this forum anymore. I couldn't help myself. Sorry.

[LisaContractorUmbrella]

Any of these 'schemes' (and there are hundreds of them) will, at best, defer the tax that you owe. If you live and work in the UK you are liable for UK taxes - if you are outside IR35 set up a limited company and you will then be able to draw dividends from the company. If you are inside IR35 you absolutely must, no alternatives, no exceptions, be paid through PAYE whether through a limited company or an umbrella.

[Mozart]

Have you ever thought about using a search button rather than just logging on and hammering keys? Researching dodgy schemes where your money is involved should amount to a little more than asking a question on a board that has been asked many times before IMO

I actually did do a Google search before coming on here, read the HMRC stuff, and didnt find anything obvious. Thanks for your help anyway. Nice way to treat newbies BTW.

[Mozart]

Here's where they have been discussed twice in the last three months

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

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

I appreciate that searching for "Darwin" on this forum will bring up loads of references to the Darwin awards because the people that use this forum have a low tolerence for stupid people, but FFS, how hard is it to search?

Thats all very well and good but the forums dont say anything other than beware, I was hoping for a response from perhaps a tax specialist or accountant who may know why they would not work rather than mere speculation.

There are two points:
1. The reason that BN66 comes into play is because HMRC are using it to clarify a pre-existing law around double taxation treaties, they are not changing the rules so to speak therefore giving them the power to apply the tax retrospectively.
2. There is no ambiguity around the law on trusts, they are obviously looking to close them down hence the reason they are on the HMRC spotlight list but I dont see how they can apply any taxes retrospectively since it is pretty clear. I can see them being abolished but to my mind, that still gives a year where they could be utilised because it would have to wait til the next budget to change.

Further to HMRCs argument that "Our view is that at the time the funds are
allocated to a UK employee or his/her beneficiaries, those funds become
earnings on which PAYE and NICs are due and should be accounted for by the
employer." HMRC tried and failed to make similar arguments to the court in Sempra Metals Ltd v The Commissioners for Her Majesty's Revenue and Customs 2008.

I cannot believe the venom that gets spewed for asking a question around here rather than engaging in an intelligent discussion. *YEESH*

[lexington_spurs]

Searching by "Darwin" you ought to find a lot of references to deep water, canoes, and paddles!

[wheatgerm]

Any of these 'schemes' (and there are hundreds of them) will, at best, defer the tax that you owe. If you live and work in the UK you are liable for UK taxes - if you are outside IR35 set up a limited company and you will then be able to draw dividends from the company. If you are inside IR35 you absolutely must, no alternatives, no exceptions, be paid through PAYE whether through a limited company or an umbrella.

Silly question maybe but in a line or two (if poss), how does one know if he/she is within or outside IR35?

[NotAllThere]

...Nice way to treat newbies BTW.

Only Newbies who are FAQers or obviously suppliers of dodgy products.

[DonkeyRhubarb]

1. The reason that BN66 comes into play is because HMRC are using it to clarify a pre-existing law around double taxation treaties, they are not changing the rules so to speak therefore giving them the power to apply the tax retrospectively.

Just to be clear, this is a total load of tosh put forward by HMRC to try and justify it.

It will become clear on 19th January, that in this case clarify=change.