Can they do it the "Pompey" way
Well Greece are so I guess it is possible outside of football but despite its reputation to the contrary Financial Services to tend to protect the customer more.
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How to avoid paying stamp duty??
- Thread starter Dex10
- Start date
Well Greece are so I guess it is possible outside of football but despite its reputation to the contrary Financial Services to tend to protect the customer more.
Uncle Spielberg
Well-known member
What I am questioning which I hoped ILOVEBHA could comment on is can the government and IR came after this tax for property purchases that have completed that has been avoided with this loophole and if so how may years back can they go or is the loophole being closed for new purchases.
The fact my clients have been written to demanding the SD plus interest suggests they can and will be tracking down all these people which will be easy to do.
The clients also paid the company over £ 3000 for this " service ". I know of 1 other client who got £ 30k back through one of these companies he did himself and again paid them over £ 3000. Will he be written to as well ? No doubt the clients have spent the money so if they cannot pay it now what happens ? It could be a serious situation for them.
The fact my clients have been written to demanding the SD plus interest suggests they can and will be tracking down all these people which will be easy to do.
The clients also paid the company over £ 3000 for this " service ". I know of 1 other client who got £ 30k back through one of these companies he did himself and again paid them over £ 3000. Will he be written to as well ? No doubt the clients have spent the money so if they cannot pay it now what happens ? It could be a serious situation for them.
Uncle Spielberg
Well-known member
Here is the article.
Budget: Osborne pledges 'aggressive' measures on stamp duty avoidanceGeorge Osborne: "People have had their warning, they have got to pay stamp duty on the homes they live in"
Chancellor George Osborne has confirmed he will be "coming after" stamp duty avoidance with "aggressive" new measures in this week's Budget.
He said buying homes through a company to avoid the tax was "unacceptable" and pledged to "come down on that practice like a tonne of bricks".
Mr Osborne also told the BBC his would be a Budget "for working people".
Labour said reports that he planned to cut the 50p tax rate on earnings over £150,000 showed he was "out of touch".
Stamp duty starts at 1% of a property's value for homes costing more than £125,000 and goes up to 5% for those costing more than £1m.
The Sunday Times reports that rock stars are among wealthy people who have bought properties through offshore companies - amounting to millions of pounds in stamp duty forfeited by the UK.
'Very punitive charge'
On BBC One's Andrew Marr Show Mr Osborne said: "Rich people, often foreigners who come to this country, but also some people here in Britain, who put homes into companies to avoid stamp duty - that is completely unacceptable.
Shadow Chancellor Ed Balls says George Osborne is "totally out of touch"
"We are going to come down on that practice like a tonne of bricks, We are coming after that tax avoidance, we are going to be extremely aggressive in dealing with it, and people are going to face a very punitive charge."
He said there would be new measures announced in the Budget on Wednesday, adding: "People have had their warning. They need to pay stamp duty on the homes they live in."
Budget: Osborne pledges 'aggressive' measures on stamp duty avoidanceGeorge Osborne: "People have had their warning, they have got to pay stamp duty on the homes they live in"
Chancellor George Osborne has confirmed he will be "coming after" stamp duty avoidance with "aggressive" new measures in this week's Budget.
He said buying homes through a company to avoid the tax was "unacceptable" and pledged to "come down on that practice like a tonne of bricks".
Mr Osborne also told the BBC his would be a Budget "for working people".
Labour said reports that he planned to cut the 50p tax rate on earnings over £150,000 showed he was "out of touch".
Stamp duty starts at 1% of a property's value for homes costing more than £125,000 and goes up to 5% for those costing more than £1m.
The Sunday Times reports that rock stars are among wealthy people who have bought properties through offshore companies - amounting to millions of pounds in stamp duty forfeited by the UK.
'Very punitive charge'
On BBC One's Andrew Marr Show Mr Osborne said: "Rich people, often foreigners who come to this country, but also some people here in Britain, who put homes into companies to avoid stamp duty - that is completely unacceptable.
Shadow Chancellor Ed Balls says George Osborne is "totally out of touch"
"We are going to come down on that practice like a tonne of bricks, We are coming after that tax avoidance, we are going to be extremely aggressive in dealing with it, and people are going to face a very punitive charge."
He said there would be new measures announced in the Budget on Wednesday, adding: "People have had their warning. They need to pay stamp duty on the homes they live in."
Uncle Spielberg
Well-known member
I am not trying to call ILOVEBHA on this but need some advice. My clients are buying at over £ 1m and when I asked if they had heard of this scheme they said " yes we did it last time and now the IR have written to us demanding the money back " WTF happens to the firms that did these transactions ?
Uncle Spielberg
Well-known member
Stamp Duty starts at 1% on properties over £125,000, rising to 5% on homes over £1m but it can currently be avoided by buying the property through an offshore company. In October, HMRC said it was chasing 1,200 people for £35m in lost revenues because of avoidance of the levy.
That's just under £ 30k per transaction.
That's just under £ 30k per transaction.
You know you can edit any post you make for a period after making it?
You don't need to post 4 (four) consecutive times on the same thread.
You don't need to post 4 (four) consecutive times on the same thread.
The government were looking into this a while back, and as always it was/is about interpretation. A lot of key people agreed that the legislation was pretty damn clear and that any intepretation to the contrary was fanciful. Given Osborne has come out with his statements I can only presume that his legal advisors agree the legislation is clear and he can recoup these taxes. At the top end he will be dealing with people/entities which have access to quality advice so he must be confident he can get the dollar back.
I personally do not think you/we will hear from [MENTION=2631]ILOVEBHA[/MENTION] again.
ILOVEBHA
Member
I am here just got back from 2 weeks in sunny Thailand so sorry for missing this reincarnation of an old post.
Any questions shoot away
Welcome back, how are things in the office this morning then?
ILOVEBHA
Member
I love the fact everyone gets excited by paper talk and that is exactly what HMRC want to happen when they do these press releases.
So far Mr Tubthumper we are still here, practicing, advising clients and not one case has ever been lost.
I thank you
So far Mr Tubthumper we are still here, practicing, advising clients and not one case has ever been lost.
I thank you
ILOVEBHA
Member
Very busy as you can imagine being away for 2 weeks but nothing too bad.
Paper talk? HMRC? it was the PM on tv and further backed up by Osborne yesterday. Let's wait until the budget is over to see what it exactly entails.
AS for your claim about cases not being lost, technically this is probably true as the HMRC have only recently sent out letters. I'm not aware of any cases actually going through the court yet but I could be wrong. It's a bit like me saying I have never lost a fight to Mike Tyson.
ManxSeagull
NSC Creator
ILOVEBHA
Member
Lets wait and see what the budget says but from what we understand they seem to be targetting stamp duty schemes using foreign companies but lets wait and see.
As well as the offshore angle this announcement also made. Will be some nervous individuals I would think.
3. Section 45 of the Finance Act 2003 provides, broadly, that there is
only one charge to SDLT where the purchaser of an interest in land,
before completing that purchase, sells on the interest in land to
another person.
4. This measure is intended to address a particular SDLT avoidance
scheme that attempts to abuse section 45. Under the scheme, the
purchaser of an interest in land, at the same time as completing the
purchase, grants an option to purchase that interest to a third party.
This scheme is being widely marketed by promoters of SDLT
avoidance schemes.
5. It is claimed that the transactions in this scheme fall within section 45
and that therefore no SDLT is payable on the initial purchase. The
Government does not believe that this is correct and users of this
scheme will be challenged by HMRC.
6. In order to prevent revenues being put at risk and to protect the public
from being sold this scheme, the Government wishes to clarify that
the grant or assignment of an option does not result in the completion
of the original contract being disregarded. The Government believes that the grant or assignment of an option cannot be a transfer of rights and this measure will make that explicit on the face of the legislation.
3. Section 45 of the Finance Act 2003 provides, broadly, that there is
only one charge to SDLT where the purchaser of an interest in land,
before completing that purchase, sells on the interest in land to
another person.
4. This measure is intended to address a particular SDLT avoidance
scheme that attempts to abuse section 45. Under the scheme, the
purchaser of an interest in land, at the same time as completing the
purchase, grants an option to purchase that interest to a third party.
This scheme is being widely marketed by promoters of SDLT
avoidance schemes.
5. It is claimed that the transactions in this scheme fall within section 45
and that therefore no SDLT is payable on the initial purchase. The
Government does not believe that this is correct and users of this
scheme will be challenged by HMRC.
6. In order to prevent revenues being put at risk and to protect the public
from being sold this scheme, the Government wishes to clarify that
the grant or assignment of an option does not result in the completion
of the original contract being disregarded. The Government believes that the grant or assignment of an option cannot be a transfer of rights and this measure will make that explicit on the face of the legislation.
ILOVEBHA one of them. He was rather bullish and cocksure when he first logged on today. But once he had absorbed some of his work emails from when he was away his mood had changed by post #194.
ILOVEBHA
Member
It is great how Herr Tubthumper loves to spin like a politician.
Currently our providers are digesting the news and will let us know of any changes.
I dont believe i have ever been cocksure about these schemes but just wanted everyone to know that these do exist and many people take advantage of the opportunity.
Currently our providers are digesting the news and will let us know of any changes.
I dont believe i have ever been cocksure about these schemes but just wanted everyone to know that these do exist and many people take advantage of the opportunity.
No it doesn't. You have shown no existing (prior to the budget) law that says what ILOVEBHA was offering was illegal. They may stop it for future transactions, they may even prosecutes people who didn't do things correctly in the first place.
I do dislike people getting away without paying their tax, and it's usually the very rich that do it - like the Labour Party. That said, if they've followed the rules, it's not their fault that there were loop-holes in the law, so dislike them as I do, you can't ask them to pay something they don't legally owe.
If the loophole was there, and the clients did things correctly, the government can never get the money back, because they were never due it. If someone uses one of these schemes and tells the government, and the government later prove (or a court decides) that the tax return is incorrect (loophole doesn't exist, scheme is not allowed), then the government would have 7 years for income tax - not sure if it's different for stamp duty? If someone has lied in their return though, it is fraudulent, and there is no cut off date for the government.
Good. Now we just have to find out if their schemes used the law correctly or not.
Like when Labour didn't pay stamp duty on their multi million pound London property deals.
I doubt it. The budget is about new laws, not chasing underpayments, so these comments are more about looking good in the speech than the reality of what's to follow.
You're really trying to gloat, but it seems far too early for that.
Well the one thing we can all agree on is that you were wrong there.
- Thread starter
- #199
'A new 15 per cent tax will also be imposed on all properties over £2million which are bought via a company in an attempt to close a loophole'
Reading the above, am I correct in thinking that purchases beow 2 million would still be able to use the existing scheme/loophole?. I know that companies were actively marketing stamp duty mitigation for properties in excess of 250K?
Reading the above, am I correct in thinking that purchases beow 2 million would still be able to use the existing scheme/loophole?. I know that companies were actively marketing stamp duty mitigation for properties in excess of 250K?
ILOVEBHA
Member
Lets wait and see what our providers make of the budget report but it looks like we will be able to continue using the scheme.