Tax avoiders to be deliberately bankrupted.....?..
Discussion
RYH64E said:
Those who can't see what the problem have probably never had the dubious pleasure of paying HMRC an amount that could be better spent on a new Aston Martin.
+1I was an employee for 15 years and never really thought much about tax. It just got taken off my salary every month and despite having the odd grumble it wasn't really something that concerned me.
Now that I run my own business, nothing annoys me more than paying tax. I work very hard, and despite the best creative efforts of my accountants, I still have to hand over a big fat slice of money to HMRC. Money that in my mind I've really grafted for.
I now totally understand why people in business try to 'waste' as much money as possible rather than give any of it to HMRC. Buy stuff you don't need, laptops, iPads, phones, new work van, tools, gadgets, etc just to reduce the tax bill.
It is totally irrational as to why paying tax annoys me, but it really does.
Alpinestars said:
That's topical DM journalism. Nothing clever about it at all. If the readership fall for it, that says more about them than the intelligence of the DM.
However, had they reported and understood the facts, they should have pointed out that it looks like the investors are being taxed on income they were never going to, and never will, receive.
Not only the DM either. The Times is not above spin.However, had they reported and understood the facts, they should have pointed out that it looks like the investors are being taxed on income they were never going to, and never will, receive.
'Investors on brink after enormous repayment demands',
'Stars face ruin over tax bill',
both give the appearance of concern for those with terrible financial problems after being subject to outrageous demands from HMC, but a few paragraphs we find that 'there is no evidence that any named investor is in financial difficulties'. This despite a quote suggesting people will be jumping off roofs.
It avoids, perhaps evades might be more apt, the main point. The courts have decided that they were abusing a tax break. The money, our money, was meant to encourage the film industry. Nothing they have
Someone suggested some participants are 'distraught'.
There is very little coverage of the abuse of the process.
There are two sides to every story, but some mention of it being my money might not go amiss.
Derek Smith said:
Not only the DM either. The Times is not above spin.
'Investors on brink after enormous repayment demands',
'Stars face ruin over tax bill',
both give the appearance of concern for those with terrible financial problems after being subject to outrageous demands from HMC, but a few paragraphs we find that 'there is no evidence that any named investor is in financial difficulties'. This despite a quote suggesting people will be jumping off roofs.
It avoids, perhaps evades might be more apt, the main point. The courts have decided that they were abusing a tax break. The money, our money, was meant to encourage the film industry. Nothing they have
Someone suggested some participants are 'distraught'.
There is very little coverage of the abuse of the process.
There are two sides to every story, but some mention of it being my money might not go amiss.
The Times also does this with Brexit ( I get it every day). Best left on the other thread though. 'Investors on brink after enormous repayment demands',
'Stars face ruin over tax bill',
both give the appearance of concern for those with terrible financial problems after being subject to outrageous demands from HMC, but a few paragraphs we find that 'there is no evidence that any named investor is in financial difficulties'. This despite a quote suggesting people will be jumping off roofs.
It avoids, perhaps evades might be more apt, the main point. The courts have decided that they were abusing a tax break. The money, our money, was meant to encourage the film industry. Nothing they have
Someone suggested some participants are 'distraught'.
There is very little coverage of the abuse of the process.
There are two sides to every story, but some mention of it being my money might not go amiss.
Derek Smith said:
Not only the DM either. The Times is not above spin.
'Investors on brink after enormous repayment demands',
'Stars face ruin over tax bill',
both give the appearance of concern for those with terrible financial problems after being subject to outrageous demands from HMC, but a few paragraphs we find that 'there is no evidence that any named investor is in financial difficulties'. This despite a quote suggesting people will be jumping off roofs.
Anyone would get the impression they have managed to afford a PR agency to work on their behalf 'Investors on brink after enormous repayment demands',
'Stars face ruin over tax bill',
both give the appearance of concern for those with terrible financial problems after being subject to outrageous demands from HMC, but a few paragraphs we find that 'there is no evidence that any named investor is in financial difficulties'. This despite a quote suggesting people will be jumping off roofs.
Jockman said:
The Times also does this with Brexit ( I get it every day). Best left on the other thread though.
No doubt the majority of papers spin to sell. But the sad thing is the number of people who believe stuff they want to be true. And at the same time cry foul over media outlets that don't confirm their bias. Confirmation bias at its best.
Alpinestars said:
No doubt the majority of papers spin to sell. But the sad thing is the number of people who believe stuff they want to be true. And at the same time cry foul over media outlets that don't confirm their bias.
Confirmation bias at its best.
Nearly every thread on here confirms this to be true Confirmation bias at its best.
RYH64E said:
The problem is that even after you've mitigated what you can you're still left with a big bill, it's tempting to go further but all of the advisors trying to sell me schemes have been about as credible as Del Boy, and the only one I actually trust said just pay up. I guess others are either more trusting or less risk adverse than me.
I used to get called all the time about similar film and other more complex schemes. They all seemed to involve sleezy essex boy salesmen, very large opaque arrangement fees, some legal advice 'which they wern't really supposed to show you' which said it was all legit, and borrowing a large amount of money to generate fake losses or payments. . I do know a lot of people who have done various schemes and only a few of the early film ones got away with it. After fees, interest on leverage, back payment of tax plus interest almost everyone gets screwed. Complete scam industry IMO.Derek Smith said:
The Times said:
289 people put £50m into the scheme. The amount is increased by a loan from Barlcays for £790m. Disney is paid £503m for the rights to two films, Enchanted and Underdog. Barclays is paid £293m for 10 years, the interest on the £790m loan. The films are relicensed to Disney in the expectation of £1,022bn over 20 years. The 289 claim tax relief of £117m on the interest payments to Barclays.
(The weird tenses of the verbs is deliberate. I wouldn't want to put Haymarket at risk.)
All the above is via The Times and seems to be accepted by everyone. It has been republished by other media, but whether they have their own sources or not is unknown.
I think that answers you question. I think few of the 289 sat in wooden fold-up chairs.
There are 780 people involved overall. What the others did, as what else the 289 did, has not been published.
I still don't get the numbers the Mail use in their example. 289 people invest £173k each. They claim tax relief of £177m, or £400k each. Why does the Mail think they are being asked for £2m to £4m each? This can't all be penalties and interest, can it??289 people put £50m into the scheme. The amount is increased by a loan from Barlcays for £790m. Disney is paid £503m for the rights to two films, Enchanted and Underdog. Barclays is paid £293m for 10 years, the interest on the £790m loan. The films are relicensed to Disney in the expectation of £1,022bn over 20 years. The 289 claim tax relief of £117m on the interest payments to Barclays.
(The weird tenses of the verbs is deliberate. I wouldn't want to put Haymarket at risk.)
All the above is via The Times and seems to be accepted by everyone. It has been republished by other media, but whether they have their own sources or not is unknown.
I think that answers you question. I think few of the 289 sat in wooden fold-up chairs.
There are 780 people involved overall. What the others did, as what else the 289 did, has not been published.
clarkey said:
I still don't get the numbers the Mail use in their example. 289 people invest £173k each. They claim tax relief of £177m, or £400k each. Why does the Mail think they are being asked for £2m to £4m each? This can't all be penalties and interest, can it??
The £1bn income in the LLP is taxable income for the investors. In this particular LLP, £50m was invested. Tax at say 45% would be £450m, plus interest. The 10 to 20 times headline applies to all the different partnerships set up by the firm. Alpinestars said:
The £1bn income in the LLP is taxable income for the investors. In this particular LLP, £50m was invested. Tax at say 45% would be £450m, plus interest. The 10 to 20 times headline applies to all the different partnerships set up by the firm.
That makes sense now, thanks!I believe that this will put others off 'investing' into such schemes which is a good thing for UK plc tax revenue.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
foliedouce said:
I believe that this will put others off 'investing' into such schemes which is a good thing for UK plc tax revenue.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
I'm sure you feel a little better knowing that GT also incurred risk, sanction and cost in this matter? Or perhaps not...........
foliedouce said:
I believe that this will put others off 'investing' into such schemes which is a good thing for UK plc tax revenue.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
Great post.I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
I can see why you were in a no-win situation as there would be no comeback on GT as they would just insist it was legal and it would be up to you to prove otherwise in court... which would take years.
foliedouce said:
I believe that this will put others off 'investing' into such schemes which is a good thing for UK plc tax revenue.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
I participated in a (sold as 'complete legal and above board') scheme with many other IT Contractors. I honestly went into it thinking "too good to be true" and thought "oh well, worst than can happen is I will send in my Self Assessment form at the end of the year and if it's not legit I'll get a bill and I'll pay it"I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
So I did that that, first SA form went in, not a sniff. Repeat for the second, third, fourth, fifth, and (almost) sixth years ... not a sniff. Just before I put my sixth one in, got a brown envelope from HMRC, "we are investigating". Oh dear, I thought.
I naiively (because I really needed cash to get on my feet following a messy separation) stayed with the promoter for a further six years under a different scheme, whilst litigation ensued as to the legality of the original scheme. Same is likely to happen under the second scheme, all under investigation and likely a bill coming. Cutting a very long story short, I am now a middle-income earner facing a bill of tax + interest circa £300k. I've managed to scrape together £150k, but will need to remortgage (I don't have enough equity for all of it) and pay the remainder on the drip.
Do I want symathy? No. I tried something that I was advised was legit and it turns out it wasn't, so I must pay up. The sad irony is that I will end up paying far more than if I had just 'gone straight' originally and given it a wide berth, it is a very harsh lesson in life. You can think "dodgy tax avoiding b
d" if you want but in my industry lots of people leapt at the chance of these things in the wake of IR35, because we were sold it as legit tool to avoid IR35 at a time when many of us saw a Government intent on screwing freelance contractors. Note that one of the Big Six accountancy firms promoted an identical scheme, but quietly dropped out of litigation when they faced the prospect of losing lucrative Govt consultancy work. My biggest worry is bankruptcy. I am willing and able to pay, but in all likelihood probably need a few years to pay it all off. I'm happy to pay interest, but am desperately worried that HMRC won't allow that long, even if I borrow up to the hilt elsewhere, and they will go down the bankruptcy route. I'd be pretty miffed if I coughed £250k of the total £300k pronto, only for them not to allow me time to gather that final £50k together, given that the whole sorry affiar has been going for 14 years now.
If I could give one bit of advice to anyone contemplating any kind of tax avoidance scheme it is this: please don't, run as far from it as you can, safe in the knowledge that you can sleep at night.
PurpleTurtle said:
I participated in a (sold as 'complete legal and above board') scheme with many other IT Contractors. I honestly went into it thinking "too good to be true" and thought "oh well, worst than can happen is I will send in my Self Assessment form at the end of the year and if it's not legit I'll get a bill and I'll pay it"
So I did that that, first SA form went in, not a sniff. Repeat for the second, third, fourth, fifth, and (almost) sixth years ... not a sniff. Just before I put my sixth one in, got a brown envelope from HMRC, "we are investigating". Oh dear, I thought.
I naiively (because I really needed cash to get on my feet following a messy separation) stayed with the promoter for a further six years under a different scheme, whilst litigation ensued as to the legality of the original scheme. Same is likely to happen under the second scheme, all under investigation and likely a bill coming. Cutting a very long story short, I am now a middle-income earner facing a bill of tax + interest circa £300k. I've managed to scrape together £150k, but will need to remortgage (I don't have enough equity for all of it) and pay the remainder on the drip.
Do I want symathy? No. I tried something that I was advised was legit and it turns out it wasn't, so I must pay up. The sad irony is that I will end up paying far more than if I had just 'gone straight' originally and given it a wide berth, it is a very harsh lesson in life. You can think "dodgy tax avoiding bd" if you want but in my industry lots of people leapt at the chance of these things in the wake of IR35, because we were sold it as legit tool to avoid IR35 at a time when many of us saw a Government intent on screwing freelance contractors. Note that one of the Big Six accountancy firms promoted an identical scheme, but quietly dropped out of litigation when they faced the prospect of losing lucrative Govt consultancy work.
My biggest worry is bankruptcy. I am willing and able to pay, but in all likelihood probably need a few years to pay it all off. I'm happy to pay interest, but am desperately worried that HMRC won't allow that long, even if I borrow up to the hilt elsewhere, and they will go down the bankruptcy route. I'd be pretty miffed if I coughed £250k of the total £300k pronto, only for them not to allow me time to gather that final £50k together, given that the whole sorry affiar has been going for 14 years now.
If I could give one bit of advice to anyone contemplating any kind of tax avoidance scheme it is this: please don't, run as far from it as you can, safe in the knowledge that you can sleep at night.
A very sad and salutary tale. All I can say is I hope HMRC don't go for the jugular on this and that they are reasonable in their dealing with you.So I did that that, first SA form went in, not a sniff. Repeat for the second, third, fourth, fifth, and (almost) sixth years ... not a sniff. Just before I put my sixth one in, got a brown envelope from HMRC, "we are investigating". Oh dear, I thought.
I naiively (because I really needed cash to get on my feet following a messy separation) stayed with the promoter for a further six years under a different scheme, whilst litigation ensued as to the legality of the original scheme. Same is likely to happen under the second scheme, all under investigation and likely a bill coming. Cutting a very long story short, I am now a middle-income earner facing a bill of tax + interest circa £300k. I've managed to scrape together £150k, but will need to remortgage (I don't have enough equity for all of it) and pay the remainder on the drip.
Do I want symathy? No. I tried something that I was advised was legit and it turns out it wasn't, so I must pay up. The sad irony is that I will end up paying far more than if I had just 'gone straight' originally and given it a wide berth, it is a very harsh lesson in life. You can think "dodgy tax avoiding b
d" if you want but in my industry lots of people leapt at the chance of these things in the wake of IR35, because we were sold it as legit tool to avoid IR35 at a time when many of us saw a Government intent on screwing freelance contractors. Note that one of the Big Six accountancy firms promoted an identical scheme, but quietly dropped out of litigation when they faced the prospect of losing lucrative Govt consultancy work. My biggest worry is bankruptcy. I am willing and able to pay, but in all likelihood probably need a few years to pay it all off. I'm happy to pay interest, but am desperately worried that HMRC won't allow that long, even if I borrow up to the hilt elsewhere, and they will go down the bankruptcy route. I'd be pretty miffed if I coughed £250k of the total £300k pronto, only for them not to allow me time to gather that final £50k together, given that the whole sorry affiar has been going for 14 years now.
If I could give one bit of advice to anyone contemplating any kind of tax avoidance scheme it is this: please don't, run as far from it as you can, safe in the knowledge that you can sleep at night.
PurpleTurtle said:
foliedouce said:
I believe that this will put others off 'investing' into such schemes which is a good thing for UK plc tax revenue.
I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
I participated in a (sold as 'complete legal and above board') scheme with many other IT Contractors. I honestly went into it thinking "too good to be true" and thought "oh well, worst than can happen is I will send in my Self Assessment form at the end of the year and if it's not legit I'll get a bill and I'll pay it"I participated in a scheme (not film) sold to me by a well known firm of accountants (Grant Thornton) 5 years ago - the set up cost was 50k which seemed like a good deal at the time based on the tax saved.
Fast forward to this year and I have a choice, let HMRC take me to court (GT are still claiming it's a legitimate scheme) which could take 10 years if it goes to Supreme Court plus god knows how much in legal fees, or just pay up plus interest. I chose to do the latter. So not only did I have to pay the tax (unbudgeted) at 50% but also interest and wasted 50k in fees. Luckily HMRC agreed not to charge penalties as I did a deal with them and they also allowed the company to offset the money against corporation tax as if it was paid PAYE.
Massive lesson learned, I will never do another tax scheme again, and hopefully the PR generated by this film scheme will put others off.
I actually found HMRC were reasonable to deal, they just want the tax that should have been paid as if it was PAYE / Divi as opposed to an artificial scheme purely to generate tax losses.
As much as I believe we pay too much tax in this country, I'm happy to suck it up.
So I did that that, first SA form went in, not a sniff. Repeat for the second, third, fourth, fifth, and (almost) sixth years ... not a sniff. Just before I put my sixth one in, got a brown envelope from HMRC, "we are investigating". Oh dear, I thought.
I naiively (because I really needed cash to get on my feet following a messy separation) stayed with the promoter for a further six years under a different scheme, whilst litigation ensued as to the legality of the original scheme. Same is likely to happen under the second scheme, all under investigation and likely a bill coming. Cutting a very long story short, I am now a middle-income earner facing a bill of tax + interest circa £300k. I've managed to scrape together £150k, but will need to remortgage (I don't have enough equity for all of it) and pay the remainder on the drip.
Do I want symathy? No. I tried something that I was advised was legit and it turns out it wasn't, so I must pay up. The sad irony is that I will end up paying far more than if I had just 'gone straight' originally and given it a wide berth, it is a very harsh lesson in life. You can think "dodgy tax avoiding b
d" if you want but in my industry lots of people leapt at the chance of these things in the wake of IR35, because we were sold it as legit tool to avoid IR35 at a time when many of us saw a Government intent on screwing freelance contractors. Note that one of the Big Six accountancy firms promoted an identical scheme, but quietly dropped out of litigation when they faced the prospect of losing lucrative Govt consultancy work. My biggest worry is bankruptcy. I am willing and able to pay, but in all likelihood probably need a few years to pay it all off. I'm happy to pay interest, but am desperately worried that HMRC won't allow that long, even if I borrow up to the hilt elsewhere, and they will go down the bankruptcy route. I'd be pretty miffed if I coughed £250k of the total £300k pronto, only for them not to allow me time to gather that final £50k together, given that the whole sorry affiar has been going for 14 years now.
If I could give one bit of advice to anyone contemplating any kind of tax avoidance scheme it is this: please don't, run as far from it as you can, safe in the knowledge that you can sleep at night.
Have you tried explainging you do not have it an will go bankrupt if they demand 300k - what can they take the company has not you but your limited company.
Get some advice pay what you have to not what they demand on day one.
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