Tax Havens - a good thing ?

Pennywise

kabayiri wrote: »

I've been listening to podcasts of interviews with John Christiansen and Prem Sikka about tax havens and tax evasion/avoidance in general.

It all sounds like the wealthy elite companies and individuals avoiding paying their fair share of tax.

e.g half the profits booked on a bumch of bananas gets recorded through tax havens. Is this morally right?

But....I could be wrong.

Do tax havens have a legitimate use?

It's not just businesses though is it? Lots of footballers and popstars "live" in tax havens and have learned to keep out of the UK (or US or whatever) for just long enough to retain their "non resident" status.

The simple answer is to say that all UK earnings are taxable in the UK wherever the business/individual/popstar/footballer claims his residence. It's ridiculous that a top footballer pays no UK tax because he manages to stay out of the UK just long enough not to be resident here.

ninky_2

Does anyone have a list of tax havens and how do they actually work?

I mean, I know wealthy people / companies basically hide their assests in them to avoid paying tax but how do they get to do that when the rest of us don't? Do you have to own property there for example?

I did know someone with loads of BTLs who was going to move to the Isle of Man as after 5 years they would be able to sell them all without paying capital gains tax. Is this the basic gist?

lostinrates

http://en.wikipedia.org/wiki/Tax_haven

HAven't read above to see if its complete....:) but looks comprehensive at first glance, list at the bottom.

A_fiend_for_life

Looks like there is some movement:

http://www.guardian.co.uk/business/2009/mar/13/switzerland-tax-evasion-fight

Pennywise

A_fiend_for_life wrote: »

Looks like there is some movement:

http://www.guardian.co.uk/business/2009/mar/13/switzerland-tax-evasion-fight

Don't think so. That article looks to be talking about tax evasion (that's the illegal form where people should be paying tax in say the UK but are hiding the money somewhere else). Then good old Gordon Brown starts confusing evasion with avoidance - if GB can't tell the difference what hope is there for us mere mortals!. Tax avoidance re tax havens is where people arrange themselves to be outside the UK for enough days so that they're not resident in the UK for tax purposes. There's quite a difference. It doesn't sound as if Gordon is tackling the latter at all - that's just leaving the field open for more footballers and popstars to just pop into the UK to do their stuff and then pop out again - he's showing no sign of attacking that kind of legal avoidance.

ninky_2

So how many days do you need to be outside the UK? I read that because they don't count travel days some city people fly in early on a monday and out late on a weds as this counts as them just being here for 1 day. Is this correct?

A_fiend_for_life

oops had I followed up one of those emails from employment agencies I might have been more observant.

Sounds like the rules need tightening. Government hiring companies that provide an offshore tax avoidance service would be a good start.

itsnever2lateisit?

ninky wrote: »

So how many days do you need to be outside the UK? I read that because they don't count travel days some city people fly in early on a monday and out late on a weds as this counts as them just being here for 1 day. Is this correct?

That used to be the case but it changed 2 years ago, the limit is 90 days (in the UK)INCLUDING day of arrival/departure, part days count as a whole day

HTH

kennyboy66_2

Pennywise wrote: »

The simple answer is to say that all UK earnings are taxable in the UK wherever the business/individual/popstar/footballer claims his residence. It's ridiculous that a top footballer pays no UK tax because he manages to stay out of the UK just long enough not to be resident here.

It would be impossible for a premiership footballer not to be resident in the UK and be subject to UK tax laws.

ninky_2

itsnever2lateisit? wrote: »

That used to be the case but it changed 2 years ago, the limit is 90 days (in the UK)INCLUDING day of arrival/departure, part days count as a whole day

HTH

Is that a rolling year or could you for example stay three months at the end of one year and three months at the start of the next - in effect, six months?