Lately many people has written to Jarl Moe, yes me.... and said that they are afraid of articles like the one below.
The only reason that some people got in trouble with the inland revenue and theese days are getting letters in their letterbox is because they where so stupid that they put their own name on the accounts, as the owner of the account!
Jersey and BVI where popular places to register their accounts at and now of course they get to pay the penalty for the wrong tax advice, or taking no advice at all.
HOW DO WE DO IT?
Our company set up offshore companies and accounts for many people every week and of course our job is to safeguard your assets and do your taxplanning both legal and correct.
When you set up a company this company is a separate legal identity than you, and it is not you that establish bank accounts, it is the company.
However, you can be the signatory on the account and access funds for the use of moving the company and your business forward.
So, in our case you are 100% safeguarded from the horrors of the section below.
If you wish to know more on how to pay zero tax legally, give us a call.
Have a great weekend!
No hiding place offshore now
The days of faraway tax havens have gone. However, non-taxpayers can still get some good rates overseas
Published: 14 April
The days when an offshore bank account meant keeping your financial affairs secret from the tax man are over. Customers of offshore accounts should have had a letter last week notifying them that details of their balances and interest payments will be passed to the Inland Revenue starting from the new financial year.
Moneynet savingssearch The days when an offshore bank account meant keeping your financial affairs secret from the tax man are over. Customers of offshore accounts should have had a letter last week notifying them that details of their balances and interest payments will be passed to the Inland Revenue starting from the new financial year.
Under last year's Finance Act, the Inland Revenue has the power to swap information with other tax authorities. The Government is agreeing a range of reciprocal arrangements to elicit more information about the undeclared income of UK residents. In turn, financial information will be passed to other governments' tax authorities about their citizens. These steps are intended to reduce dramatically money laundering and tax evasion.
Historically, two of the main factors for opening accounts offshore have been tax avoidance and tax evasion, though they are not not the only ones. With interest rates offshore now running at similar levels to the best available from UK savings accounts, there are few benefits for most of
us in an offshore account.
Donna Bradshaw, a director at independent financial adviser Fiona Price & Partners, says: "If you are a UK taxpayer there is no benefit. The rates are not as great as they used to be. People are going to look offshore only if they live overseas. Even then, if they are going to America it is not a good idea.
"All the [tax] loopholes have been closed. For people who are non-taxpayers there might be benefits, but rates in the UK are good, so why bother? If you are a non-taxpayer you get interest paid gross anyway."
People travelling abroad might be tempted by opening an offshore account, but there are practical difficulties, says Ms Bradshaw. Minimum balances will usually be high (see table), as are the minimum transaction sizes.
David Walker, senior tax consultant with accountant Bentley Jennison, also dismisses an offshore account for most people. "Unless you can take advantage of having money in a different jurisdiction, there is no point," he says.
"People think if you have money offshore you don't pay tax. That's not true. There might be non-taxpayers who can take advantage. If you go to a country regularly, you may want to have currency there rather than a foreign exchange account here: you might pay less commission." But offshore accounts score heavily for people whose earnings are all or in part from abroad and who are domiciled abroad.
"If someone is a UK resident but non-domiciled by birth or background, then an offshore account would be very useful," says Mr Walker. "They might work part of the time abroad. So they might be paid for offshore activities offshore and would pay tax on offshore accounts only if they bring money into the UK."
There may also be times when it is tax-efficient to roll up interest on an offshore account to have it credited after leaving the UK. For someone non-UK domiciled but with UK property interests, it may be possible to reduce inheritance liability by taking savings outside the UK estate.
But the days of using offshore accounts to hide deposits from tax authorities are well and truly gone, says Brendan McMahon, a partner with PricewaterhouseCoopers in Jersey. "There are very strong money laundering rules here," he says. "Any evidence of tax evasion or illicit activities mean that here the account will not be opened. There are very strong procedures to ensure this doesn't happen. Unlike in onshore jurisdictions, anything that happens wrongly generates a lot of adverse publicity."
It is not necessary for an individual to show that he or she is a non-taxpayer in the UK to open an account offshore. But a person can expect an increasingly rigorous check before an account is opened, especially if depositing large sums.
Northern Rock operates offshore accounts in Guernsey and the Bahamas. Tony Armstrong, director of corporate relations, says: "For both of our operations the fundamental is for verification of identity. That is a particular requirement for Guernsey. Applicants must complete the form, showing the name and address of their bank. We send this to the bank to confirm they know them, and that the signature is as shown.
"In the Bahamas, there are new verification of identification procedures which form part of our terms and conditions for an account. These are a good deal more comprehensive. There are requirements on bankers for verification of identity and national identity; confirmation of sources of income or wealth; confirmation of the purpose of an account and the potential of account activity; confirmation that the account holder has the right to beneficial use of deposits; and particularly for independent verification of any information supplied; together with a form for each applicant."
Reviews of procedures in other jurisdictions, including the Channel Islands, aimed at stamping out money laundering could lead to similar requirements in other offshore centres. Although some have been criticised for failing to co-operate with the major nations in clamping down on financial wrongdoing, most are now moving quickly to set up more rigorous checks.
Failure to act would have put at risk the more important role offshore centres have for major corporate clients, who continue to avoid tax liabilities through careful planning. And the loss of that business is something the offshore centres are very keen to avoid.
This story is applicable for people who set up accounts in their own name and DO NOT use the benefit of the correct company structure.
You are going to be smarter than that, right?