According to Rachel Murphy at Hurst “Everyone knows taxes are largely a given but there are many legitimate ways they can be managed to lessen the burden. The risk is that the Treasury is increasingly merging the two premises of avoidance of tax – which is legitimate – and evasion, which is illegal, couching it in terms of what is \’acceptable avoidance\’ and \’unacceptable avoidance\’. However, with the economic situation as it is, we have to be aware of the political sensitivities and the pressure the Treasury are under to raise revenues. Individuals and businesses need to be aware of this and the increasing scrutiny their tax affairs will be under. If HMRC does start going through the affairs of business or individuals, it\’ll take time and energy to answer their queries. If you do get a letter or a call, don\’t ignore it – speak to your tax advisor about how to deal with it.\”
HMRC Clampdown on Offshore Service Providers
The HM Revenue and Customs recently searched the premises of the Montpelier Group (an Isle of Man based Contractor Tax Scheme) and arrested a 60 year old man as part of an investigation into tax avoidance. The HMRC also searched the company’s office in the UK as part of a targeted investigation, although it is not known whether foreign authorities searched the company’s premises in Barbados and Hong Kong.
The investigation comes following the approval of BN66 rules which cleared the way for the HMRC to seek taxes retrospectively from users of such schemes. Earlier in the year an IT Contractor who used the Montpelier Group for 7 years named Robert Huitson failed in an attempt to fight the HMRC, he lost nearly £85,000.
Contractors considering offshore tax schemes which save large amounts of tax are being asked to seriously consider their position before going forward. For many the idea of paying £85,000 in backdated tax and national insurance is financially crippling, and something which can lead many to bankruptcy.
At Commonwealth Contractors we partner with OISC Registered Private Immigration Firms and Tier 2 Licensed Healthcare and IT Consultancies who may be prepared, where required, to sponsor an individual on a Tier 2 Visa (formerly UK Work Permit). If you are a highly skilled International professional and you would like to work in the UK Commonwealth Contractors can help. Our OISC Registered Partners specialise in Tier 1 General (formerly Highly Skilled Migrant Programme) visa applications and can assist those highly skilled individuals that either wish to apply or extend a Tier 1 General Visa.
For more Information call Commonwealth Contractors now on 0330 390 9021 or Submit your Details and we will get right back to you. Please see other areas of the Commonwealth Contractors site for interesting articles on tax, immigration and contracting.