As an aside, the above expenses are taken into account by the fact that you get paid well above market rate for the work you do - it’s not to be catered for out of the tax breaks you receive.
I’ve paid more than the threshold every year; intentionally so. So yes, I do pay PAYE. It was a day one consideration, largely because I don’t ever want HMRC feeling they need to check me out extensively. If you take the absolute minimum, so as to fall out of tax, you may as well put a sign up saying “I am taking the piss. Please arrest me”.
Umbrella companies are out, because of the legally dubious ownership of any fixed assets I buy. So really, we’re just talking about permanent PAYE as an option.
Last full time job I did was 36K p.a. Now would you rather I paid a third of that in tax, or a third of 80K in tax?
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Get arrested for what? Legal tax practices?
It is of course a consideration if you think you’ll be liable outside IR35 - although that all depends on how watertight your contract is, your work practices etc.
Personally, if you criticise other peoples tax affairs then you need to make sure you’re paying the maximum tax you should, which I very much doubt you are. I’m not saying what you’re doing is wrong, I couldn’t care less as what you’re doing is legal, but if you could pay more tax on PAYE then perhaps you should be.
True. But does that make it right, Shirty?
It’s accepted practice, but we’re in the shit. As we keep being told…ad nauseum.
Isn’t there some sort of moral imperative for us to all dig deep until we’ve turned the deficit around and started to chip away at our monumental national debt?
Aren’t we all in this together?
Shouldn’t a company, 15% of which is owned by our own chancellor (He’s responsible for tax policy BTW), and that appears to have been able to pay its Knight-of-the-realm-Chairman 18% more than it did the year before, somehow be obliged to say “Fuck it, the shareholders of this company have got enough. More than they need. More than they can probably spend. Let’s pay what’s (morally) due. It’ll help everyone in the long run.”?
It’s testament to how far off the pulse of modern Britain I’ve become, and testament to the gulf between us (ideologically and politically) that when we read that text, we have different reactions.
For clarity, I think it sounds morally wrong, though almost certainly totally legal.
I then feel absolutely helpless that other people (you in this instance) read that report and feel it’s fine - whilst knowing that, but for some cojones being displayed in the HoL this week, we’d have been taking an average of £1300 off thousands of hard working people.
I cannot reconcile the disparity between these different positions.
I totally respect your views, and perhaps I envy your ability to think that it’s fine. Perhaps I need to walk a mile in your shoes to see what you see and have seen? To see what sort of start in life you had. To see what advantages you’ve enjoyed. To see what I’ve seen that you haven’t.
Well at least Sir Peter is taking a salary and paying proper income tax as opposed to taking dividends like these tax dodging IT contractors
I thought the same thing, CB Saint.
IF Sir Pete’s salary is paid as PAYE (for Directors no doubt), and IF it is paid to him and not a trust, then the Revenue is seeing a contribution from that business.
I’m making some assumptions here - that the fact £179K was due as corporation tax meant that there was a profit in the business, and that that profit meant that Osborne (Snr.) could pay a dividend, and that in turn meant that Osborne (Jnr.) was able to enjoy a dividend on the profits of the company.
I can’t believe that Osborne (Jnr.) would be stupid enough to let Osborne (Snr.) try to hide income in any way that he couldn’t, in some way, defend. So it won’t be illegal and it’s only immoral if your political or ideological compass points in a certain direction.
And it would be churlish to not acknowledge that if he’s an employer and perhaps an exporter and he’s put stuff at risk to get to the position where he can take >2% of turnover as Salary, increase his salary by 18%, pay zero corporation tax for years, and he can still sleep at night, then fair play.
I just wonder what skills George Osborne has inherited coming from such a background, that allow him to interfere in the lives of people that have got fuck all money and fuck all hope.
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Bletch, read the first couple of lines of my post. I said it’s not right.
Yeah, that’s fair comment, Shirty.
I think I was guilty of responding to your points from yesterday in this post of today.
So what do you think should happen in this case?
And in the cases where companies minimise their tax position?
(Given our straightened times)
Originally posted by @Chertsey-Saint
Get arrested for what? Legal tax practices?
It is of course a consideration if you think you’ll be liable outside IR35 - although that all depends on how watertight your contract is, your work practices etc.
I’m fine on IR35. Same contract for years, watertight as far as it comes to rights of substitution, etc.
Personally, if you criticise other peoples tax affairs then you need to make sure you’re paying the maximum tax you should, which I very much doubt you are. I’m not saying what you’re doing is wrong, I couldn’t care less as what you’re doing is legal, but if you could pay more tax on PAYE then perhaps you should be.
In both recent cases where I’ve been critical of tax affairs, it has been about corporation tax, a levy that my firm has paid in full, every year. Facebook pays less. Osborne’s dad’s furniture firm hasn’t paid any since 2008, longer than my firm has actually been running.
Let’s put this into perspective further. That bloke earns more in one year than my company has made lifetime.
His firm still pays no corporation tax.
Also, Bletch, do you think that companies should be allowed to offset profits against historic debts? Personally I think you should, although I think more investigation into where those debts were sustained is needed (ie investments in property etc from other arms of the business so they don’t show as assets).
Originally posted by @saintbletchh, that’s fair comment, Shirty.
I think I was guilty of responding to your points from yesterday in this post of today.
So what do you think should happen in this case?
And in the cases where companies minimise their tax position?
(Given our straightened times)
First I’d want to know why it wasn’t paid and actually have the accounts properly reviewed by someone who knows this shit, not some people on a forum talking about shit they don’t know. I don’t know enough about accountancy to talk about moving years etc, and why it’s done, but in relation to historic debts then you should be able to write off profit against debts - you’d be fucking over too many SME’s if you removed that rule.
But personal wages is irrelevant to corporation tax? Are you proposing that if a company makes a profit but is massively in debt then its shouldn’t pay any wages to employees?
I think this is a very different situation to Facebook/Amazon etc, which is why we actually need to see the company accounts and whether they have historic losses etc.
This firm last paid corporation tax when Labour were in power. One or two years of loss is careless. Seven years unfortunately looks like financial prestidigitation to avoid paying corp tax.
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Again, as I said it depends on historic losses, hence why we need to see the accounts. I agree some of it does look like that, but then thats the way the article is spun. It doesn’t give any information in regards to the company’s financial health etc. It uses fucking turnover as a measurable FFS.
I think we need more proof. If this was true and untoward I would say this would be a bigger story than an article in Private Eye, but until I see proof either way I’m not going to make a judgement on it.
I would say in general “yes”, Shirty.
I’m generally also in favour of the welfare state.
So fuck, yeah, why not extend that welfare state to corporations?
Yes, I’m in favour of allowing businesses to legitimately manage lean and plentiful times, to help with growth and inward investment.
But the issue isn’t a legal one.
It’s a moral one.
It’s just my hunch that companies such as Osborne and Little that can afford to give a salary increase of 18% to an unnamed director, probably don’t need to throw themselves on the state’s mercy and ask for Corporate Welfare in this way.
It seems to me that in exceptional times, we should be maximising tax revenue, which to my mind means minimising Corporate Welfare like this.
After all, an unemployed mother of 5 who is diligently carrying out family planning so she can drop another benefit-claimant, sorry, child , is totally within her rights.
Right?
There’s little moral difference to me.
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But, and I’m not saying it is or it isn’t, we don’t know if the company is accounting legitimately or not. If they’re not, then yes they should pay. If they are, then no they shouldn’t. We don’t have any proof either way though.
Originally posted by @Chertsey-Saint
Originally posted by @pap
Originally posted by @Chertsey-Saint
First I’d want to know why it wasn’t paid and actually have the accounts properly reviewed by someone who knows this shit, not some people on a forum talking about shit they don’t know. I don’t know enough about accountancy to talk about moving years etc, and why it’s done, but in relation to historic debts then you should be able to write off profit against debts - you’d be fucking over too many SME’s if you removed that rule.
This firm last paid corporation tax when Labour were in power. One or two years of loss is careless. Seven years unfortunately looks like financial prestidigitation to avoid paying corp tax.
Again, as I said it depends on historic losses, hence why we need to see the accounts. I agree some of it does look like that, but then thats the way the article is spun. It doesn’t give any information in regards to the company’s financial health etc. It uses fucking turnover as a measurable FFS.
Not so.
It says that £179K was due in corporation tax.
This however was reduced to zero by offsetting.
To me this means that a profit was made. No?
I could be wrong, but that seems to speak to the underlying health of the business.
No?
IF i’m correct and NOT totally wrong…then I’d GUESS that for £179K to have been due, then the profit might have been close to £1M (corporation tax ~@20%).
Again TOTAL SUPOSITION on my part, but George is a shareholder at 15% which MIGHT mean that he COULD HAVE received ~£150K as a dividend.
This, whilst the company involved continued its trend of remitting zero corporation tax.
If it isn’t already obvious, I totally acknowledge that we know little of the facts here.
So should we encourage unmarried and unemployed mums to spew out children to maximise their ( totally legal ) benefit claims?
Originally posted by @saintbletch
Originally posted by @Chertsey-Saint
Originally posted by @pap
Originally posted by @Chertsey-Saint
First I’d want to know why it wasn’t paid and actually have the accounts properly reviewed by someone who knows this shit, not some people on a forum talking about shit they don’t know. I don’t know enough about accountancy to talk about moving years etc, and why it’s done, but in relation to historic debts then you should be able to write off profit against debts - you’d be fucking over too many SME’s if you removed that rule.
This firm last paid corporation tax when Labour were in power. One or two years of loss is careless. Seven years unfortunately looks like financial prestidigitation to avoid paying corp tax.
Again, as I said it depends on historic losses, hence why we need to see the accounts. I agree some of it does look like that, but then thats the way the article is spun. It doesn’t give any information in regards to the company’s financial health etc. It uses fucking turnover as a measurable FFS.
Not so.
It says that £179K was due in corporation tax.
This however was reduced to zero by offsetting.
To me this means that a profit was made. No?
I could be wrong, but that seems to speak to the underlying health of the business.
No?
IF i’m correct and NOT totally wrong…then I’d GUESS that for £179K to have been due, then the profit might have been close to £1M (corporation tax ~@20%).
Again TOTAL SUPOSITION on my part, but George is a shareholder at 15% which MIGHT mean that he COULD HAVE received ~£150K as a dividend.
This, whilst the company involved continued it’s trend of remitting zero corporation tax.
If it isn’t already obvious, I totally acknowledge that we know little of the facts here.
Bletch, a company can make a one year profit, but utterly fucked financially.
Here is an article on them from The Guardian last year:
A few highlights:
**But it did OK, for a small manufacturing business, didn’t it? ** It did. The company now has showrooms worldwide and has been estimated to be worth between £15m and £30m.
**That’s not that small. ** No. Although the estimated value may need to be revised. They have just announced a loss for the year of £746,000, blaming the poor “economic climate”.
**But I thought George said the economy was recovering? ** Not for Osborne & Little. The accounts show it has lost about £9m since 2009.
Yep, I don’t dispute that.
My challenge was to your point that the article didn’t speak to the financial health of the business.
I pointed out the potential profit that was inferred by the £179K tax due
I’d assumed you’d missed that when you said that they used turnover as a measurable FFS.
But, let’s a assume that the article doesn’t share anything about the health of the company.
And let’s also assume that the company is in a parlous state such that needs to ask for Corporate Welfare to offset profits against losses in different years or accounting periods.
So to me the question is should a company in such a state increase the salary of an unnamed director by 18% to £684,000?
To my mind, that either talks a little to the financial health of the business, or it talks a little to the incompetence of those running the ship.
Again, I acknowledge that we don’t know if we’re dealing in facts.
I’m still interested to hear your views on this, Shirty.
No we shouldn’t, but I think we’re talking at cross purposes. There is no way they are doing anything illegal at the moment, that’s not the accusation. I think the word ‘legitimately’ with its legal implications, was perhaps the incorrect word to use. I mean morally legitimate, so the losses example above.