Capital gains tax

No mike. You are twisting my words like a Sun journalist. What I said was that there is nothing wrong with a business being created by a business starter/creator, then being sold by him/her to a new owner who is good at growing small businesses into medium ones, then being sold on to a big-business specialist, etc. There is also nothing wrong with a person starting a business and keeping it many years and growing it to a very large business. Both are virtuous, but the latter is not more vituous than the former, imho. The former involves making a quickish buck, whereas the latter is a slow buck. I don't see anything wrong with the quick buck

I couldn't care less if my view might isn't shared by the media. I dont really vlaue the views of plodder newspaper journalists above own common sense. And yes a small number of "g&g" of the business world have opposed the tax changes, which is fine, but I disagree with them. There are plenty other g&g who agree the views I'm putting forward, but they choose not to say anything in the media (why would you put head above parapet, in today's media?)
 
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You are twisting my words like a Sun journalist

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I'll take that as a compliment. Btw it's not a 'small number of the g & g in the business world', it's an unprecedented combined campaign by the CBI, Institute of Directors, Federation of Small Businesses and British Chambers of Commerce. I think that demonstrates that the strength of feeling about this issue is widespread
 
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There is a way of avoiding CGT altogether.
I commend this to the forum.

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Don't leave us hanging! What is it that you commend to us? Remember, I'm middle aged, I don't get new ideas that quickly, so you'll need to spell it out in tedious detail /forums/images/graemlins/ooo.gif
 
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...it looks like Darling may be having second thoughts.

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There were some differences of opinion in this thread on whether it was right or wrong to drop taper relief, but I think the one thing we can agree on is that if they reverse the decision, right or wrong tho you may think that would be, it is just one more (of many) examples that this Government couldn't manage a p**s up in a brewery.
 
My accountant is setting up a meeting, with these other clever sods and me.

Basically, you agree to give them 25% of what you save, then they do the dirty for you. It involves setting up a foreign company, then selling your property or whatever to it. It sells the property then you get your money. UK gov says you cant do that, but EC says you can, so get stuffed Gordy. Gordy cant fight EC law.

A solicitor first mentioned it to me.

My accountant have already had one other customer done it.

Course this was all before Gordy altered the tax. (If he really has) I've not asked since.
 
I sense that hlb has a really cunning plan involving not selling anything for more money than he bought it for thus avoiding CGT altogether. Sly old fox
 
Dear Haydn,

I have spoken with the tax scheme provider who are a firm of lawyers based in *****

The Scheme works by exploiting a conflict between UK law and EU law. In a situation like this I am told EU law takes precedence.

(H), forms a subsidiary company, (newco), which is based in ****** H transfers some or all of its properties to newco at *** of their value. They are sold, by newco, to the eventual purchaser. Newco pays tax at the ****** rate which is **. But this *** is only charged on the ***profit which Newco makes.

This would never work in the UK because there are specific rules to stop it.

................................................................................

I'm not letting everything out the bag!!
 
I dont think this will work because you specifically set it up to avoid paying tax - I'm no expert but it would seem to me that it could be easy to prove that you specifically set this up to avoid the tax - I assume that you are expecting to remain as a UK tax payer.

It would be different if "the eventual purchaser" made it a condition that his purchase was carried out this way - but why should he?

Be careful
 
So far as I know, it has worked and does work. The providers are for obvious reasons, not revealing every thing they know. Just giving the outline.

I'm not revealing everything either, I need sorting out before every Tom Dick and Harry turn up and knacker it.

But done through proper accountants.

Also added, expect a bit of flak from tax man. So maybe better to flog everything first year. then piss off.

Think you have to be flogging a few hundred grand of property, before worth doing.

The tax man cannot contra ravine EC law. That is the key.
 
Hmmm I'd bet quite a large sum of money (winnngs tax free) that he might faff around at the edges but he wont alter the fundamental 18% flat tax idea.

Are you objecting to the withrawal of taper relief per se (I mean, the idea that the longer you hold the investment the lower your tax rate) or just the ending of the 10% rate and substitution by the new 18% rate? They're different arguments, right?
 
Erk Haydn. I wouldn't take any "scheme" advice from lawyers that I hadn't worked with before and who wanted 25% of my tax savings. OF COURSE they're going to tell you to do the scheme. What have they got to lose?

It is absolutely not true to say that EU law overrides UK law. It does sometimes, and other times it doesn't. A smart lawyer knows the difference.

You haven't given all the detial but piecing it togehter (maybe inaccurately) from what you've said it doesn't work. First, you dont say how you get the money out of Newco and into your pocket tax free - have the lawyers conveniently not mentioned that? Sexcond, you will get a CGT assessment when you transfer the properties to Newco, and stamp duty will be payable, and you will spend several years in UK courts, then lose, then take it to Europe (at MASSIVE legal cost) and imho lose there too. And you will be on risk for Inland Revenue's legal fees. Think how much 2 weeks of a top tax QC costs - a 2 hour consultation would be about £30k plus VAT, for someone good. Have the keen lawyers explained all this stuff, candidly?

Tax planning is fine where the upside is the upside and the downside is that you end up back where you started, ie paying the tax. But when the downside is tax plus the other side's legal fees in the ECJ it's a whole different ball game

You are kidding yourself if you think this is secret and no-one else knows about it. Of course folks know about it, it's just the well-advised folks don't actually do these transactions... Inland Revenue actually like this scheme, becuase they get all the CGT plus TWO lots of stamp duty at 4%, so of course they're not going to bring in rules to stop it.

I might have pieced it together wrongly - feel free to explain it some more! :-)
 
I'm not saying that I'm the only one who knows about it. Not saying that I am doing it either.

I am saying. that it's been offered to me by my very straight accountant firm and they have already done it before.

It was first mentioned to me by a solicitor, I asked my accountant to look into it. They looked into it and have now done it, for some one else.

They want to arrange a meeting with me and the providers.

Now maybe it's a fairy tale, but my accountants dont nomally tell jokes.

Personally I agree with everything you say. But I have not had the meeting yet.
 
All ok! Good luck with the meeting, but keep your bollox-early-warning-radar turned on (as I am sure you will....!)

Also ask them whether the scheme will need to be (or has already been) "disclosed" and registered with HMRC. These days many schemes must be registered (sort of like confessing!). If it is a registered (or to-be-registered) scheme, then you WILL get a very heavy enquiry from HMRC if you do it. Tax planning that doesn't need to be disclosed/registered is better, all other things being equal
 
Thism last year I was offered a scheme from a famous firm of accounts that wopuld reduce CG to 1%. The scheme had been registered with IR.
The fee up front was a straight £350k.
I declined because I thought there was every chance that it would be closed down as an option in the following budget and it was. Had I taken the offer I would have been £350k down for nothing.
The moral in the tale for me is that big accounting firms are not past selling you schemes that make a firtune for them overnight and leaving you with nothing.
I would have my radar switched on at every frequency plus sonar and searchlights when going near any of these schemes.
 
The scheme didn't involve buying a large motor yacht and then contriving a loss by having a protracted argument with the manufacturers about major defects, did it?

Sorry: couldn't resist...... /forums/images/graemlins/smile.gif
 
Yep, it's the withdrawal of the taper relief I object to. Taper relief was a nice way of rewarding risk. Now the reward has gone albeit via "better" headline rate of 18%, taking risk is less attractive.

Good news for those buying property, although the market is already pretty saturated and there's certainly not a lot of risk or reward to be had outside of London which is showing signs of cooling off.

Actually jfm, I'm surprised you're for this change. I can certainly see the attraction of simplification but you know as well as I do that the intention behind these changes is simply to raise more tax. I thought you were almost religiously against that idea /forums/images/graemlins/wink.gif
 
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