I have been tricked into a loan scheme I have been tricked into a loan scheme - Page 2
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  1. #11

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    Quote Originally Posted by cojak View Post
    And?
    How are they able to legally operate on UK territory using a bank in the same territory? From your question, I deduct that I could easily do money laundering here because all I need to do is open a bank account and then I can do whatever I want. Nobody will ask me anything.

    I don't know the law here is very weird...

  2. #12

    Respect my authoritah!

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    Quote Originally Posted by Tavy View Post
    How are they able to legally operate on UK territory using a bank in the same territory? From your question, I deduct that I could easily do money laundering here because all I need to do is open a bank account and then I can do whatever I want. Nobody will ask me anything.

    I don't know the law here is very weird...
    You can open a limited liability partnership where one of the partners is e.g. BCSL and another is a UK company or individual. They're supposed to list the beneficial owners, but there's little enforcement. The Panama papers demonstrated that this one vehicle whereby British companies are used for money laundering. BCSL is not a UK company.

    But it's irrelevant. They're almost certainly operating legally here. I.e. they're doing nothing that is contrary to criminal or civil law. Having a UK bank account doesn't mean they're giving good advice. The fact that their website clearly shows a Cyprus registered address should have been what triggered alarm bells.
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  3. #13

    More time posting than coding


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    From the other thread, I thought you received dividends not loans (or grants )? If they were genuine dividends, you shouldn't be subject to the LC.

    You're declaring the dividends on your SATR and paying tax on them?

    HMRC may investigate it as disguised remuneration, and there may ultimately be additional tax to pay on top of what you've already paid on the dividends.

    I don't think there's any need to panic though. You should get out of the scheme immediately, and start putting money on one side just in case you do need to pay more.

  4. #14

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    You have a variant of what we would call a double limited scheme.

    Most schemes operated by means of an individual receiving pay and loans from one source, usually two legal entities who are connected. The point however is that it was an individual contractor.

    Now assume that the individual contractor is actually that contractor's company (PSC). Now you have to funnel funds through the PSC (company one) into the promoter company (#2). Hence double limited.

    Where your PSC is "close" almost always the case, for many tax purposes the PSC and you are seen as one and the same. certainly it is possible for PSC liabilities to be transferred to the individual shareholder/director.

    You will not be able to restore the situation to one that is fully tax compliant by amending just your return. You will need to change the PSC returns as well.

    These schemes are not illegal and HMRC has no power to close legally operating companies. You cannot therefore claim that HMRC could, by acting in a way outside their remit, have prevented you from undertaking the tax avoidance. The clue is in the name - self assessment. The assumption is that you are sufficiently aware of your tax obligations to understand the consequences of what you do. If you are not, Google can find you advisers who are.

    In this connection it is NEVER a good idea to use a firm recommended by the scheme.

    You should drop this scheme - NOW.

    You should find an unbiased and non conflicted accountant - NOW.
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  5. #15

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    Quote Originally Posted by webberg View Post
    You have a variant of what we would call a double limited scheme.
    I'm guessing scheme operators have done this to hide the offshore element/avoidance from agencies and clients? To the agency or client, it just looks like you're running your own Ltd company (MyCo) like other contractors do. Sneaky.

    In recent years, agencies have wised up to the schemes. They have always been reluctant to deal with offshore intermediaries but more recently they've shied away from any UK intermediaries which look like fronts for schemes.

    With agencies I've gone through, it's always been MyCo or umbrella. In some cases, if you want to use an umbrella, it has to be one of their approved ones.

  6. #16

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    There may be many reasons for the use of such schemes.

    From a tax perspective, the theory was that ever tightening DR rules meant that payments to individuals were more and more likely to be seen as remuneration. Therefore direct links between individuals and the promoters etc were likely to be attacked.

    Inserting a PSC into the mix would perhaps distance this.

    As to the predilection for agencies, end users etc to turn a blind eye to this sort of scheme which was presented as an engagement with a PSC (rather than an individual), I am not really qualified to comment on.

    It's impossible for me to say whether such entities deliberately used this sort of subterfuge or were themselves victims of better minds.
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  7. #17

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    Quote Originally Posted by webberg View Post
    It's impossible for me to say whether such entities deliberately used this sort of subterfuge...
    I'd bank on it. These days agencies are highly suspicious of any intermediaries, apart from a MyCo, that they don't know to be 100% kosher. If the intermediary is not on their umbrella list then you can probably forget it.

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