Use The Same Techniques The Rich And Famous To Avoid Taxes

Use the​ Same Techniques the​ Rich And Famous to​ Avoid Taxes!
You've probably read in​ the​ newspapers of​ various celebrities and successful business who manage to​ avoid or​ at​ least substantially reduce their UK taxes – whilst a​ significant proportion of​ the​ general public are paying close to​ 50% of​ their income in​ tax .​
Well,​ there's nothing to​ prevent you​ using some of​ these techniques to​ slash your UK taxes as​ well,​ depending on​ your circumstances .​
Here's some of​ the​ techniques that the​ Rich & famous use:
Make the​ most of​ your offshore status
People like Mohammad al Fayed make tremendous use of​ their non UK domiciled status .​
If you're an​ overseas national and were born overseas (typically your father will also have been a​ non UK domiciliary at​ the​ date of​ your birth) you​ can avoid paying any tax on​ your overseas income and capital gains .​
The main condition to​ this is​ that you​ need to​ keep the​ income or​ proceeds outside of​ the​ UK .​
As you'd expect though there are ways around this to​ enable some of​ the​ proceeds and income to​ be brought into the​ UK free of​ taxes.
Make the​ most of​ your spouses offshore status.
If you're lucky enough to​ have a​ husband or​ wife that is​ either non UK resident or​ non UK domiciled you​ can use their offshore status to​ your advantage .​
This is​ what Philip Green did (the billionaire owner of​ BHS) .​
His wife is​ a​ resident of​ Monaco and he ensured that she extracted dividends from his UK companies free of​ UK (and overseas) tax .​
This saved him paying UK tax of​ around £200Million that he would have otherwise had to​ pay if​ he'd extracted the​ dividends.
Using a​ tax efficient holding company.
Famous bands such as​ U2 and the​ Rolling stones make use of​ some of​ the​ best offshore tax companies to​ avoid paying tax on​ much of​ their income .​
U2 for example used to​ fall within the​ Irish tax regime which had a​ longstanding tax exemption for artists .​
When this loophole was tightened up,​ they moved their holding company to​ the​ Netherlands to​ take advantage of​ tax free royalties .​
There are lots of​ other countries that can also offer tax efficient holding companies such as​ Spain,​ Denmark and Cyprus .​
Using tax efficient trading companies.
Multinationals such as​ Coca Cola make good use of​ a​ string of​ offshore companies to​ ensure that they can redistribute profits within the​ group to​ reduce the​ overall 'effective' rate of​ corporation tax .​
(It is​ reducing this effective rate that is​ the​ main focus of​ many in​ house tax lawyers lives!)
Actually move overseas Celebrities such as​ James Blunt,​ Michael Schumacher and Boris Becker have all moved offshore to​ ensure they have only limited UK tax obligations .​
They've based themselves in​ Switzerland and are local residents .​
The beauty of​ Switzerland is​ the​ 'fiscal deal' which allows the​ tax liability to​ be fixed at​ an​ artificially low amount .​
So there you​ have it​ – some ideas to​ get you​ thinking about how you​ could use the​ offshore tax planning techniques of​ the​ rich and famous .​
For more detailed articles on​ offshore tax visit
Use The Same Techniques The Rich And Famous To Avoid Taxes Use The Same Techniques The Rich And Famous To Avoid Taxes Reviewed by Henda Yesti on July 05, 2018 Rating: 5

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