How to avoid paying stamp duty??

[Triggaaar]

So, your scheme is based on not paying and keeping your fingers crossed the HMRC do not come knocking for 4 years?

As an aside, I dispute this 4 year period as per Driver8's post.

You don't seem to be posting any insight into how these schemes work, you're just against them regardless of what evidence is posted here. You're saying 'keep your fingers crossed' because you want to suggest the schemes aren't worth it, but you have no evidence of anyone ever having to pay following the use of one of these schemes. And you dispute the 4 year period because what, you're jealous? Because you haven't offered any legal arguement as to why the time limit should be more than 4 years. It's clearly not fraud is it, the labour party do the same thing.

I have never used the scheme because I was advised not to. I was in a position where I had a number of options on the title configuration of a property as well. My advisor mentioned I might have heard of these schemes but he suggested avoiding them as they are subject to challenge with the very strong likelihood (in his opinion) they will not be proven to work.

So the person that advises you suggested it wasn't a good idea. Why not just leave it at that and move along.

I'm sorry but nothing you have said or suggested is making me change my opinion.

Does anyone want to change your opinion? You don't like it, no problem, but there's no need to keep saying you don't like it unless you can actually find some facts/evidence to show why it won't work.

 

[ILOVEBHA]

You don't seem to be posting any insight into how these schemes work, you're just against them regardless of what evidence is posted here. You're saying 'keep your fingers crossed' because you want to suggest the schemes aren't worth it, but you have no evidence of anyone ever having to pay following the use of one of these schemes. And you dispute the 4 year period because what, you're jealous? Because you haven't offered any legal arguement as to why the time limit should be more than 4 years. It's clearly not fraud is it, the labour party do the same thing.
So the person that advises you suggested it wasn't a good idea. Why not just leave it at that and move along.
Does anyone want to change your opinion? You don't like it, no problem, but there's no need to keep saying you don't like it unless you can actually find some facts/evidence to show why it won't work.

Here Here great post

 

[Uncle Spielberg]

My opinion is that with tax revenues devastated in recent years and the state the country is in, there will be a very hard line used on anyone and anything that tries to avoid paying taxes. It is not beyond the realms of possibility retrospective legaslation may be passed and people who avoided Stamp Duty may find it coming back to haunt them. This is just my opinion.

 

[ILOVEBHA]

Retrospective tax legislation just would not work and would open up a whole can of worms...they have never done it before and they normally just close loopholes when they become too expensive and all that happens is another appears to take over.

 

[Uncle Spielberg]

I am not having a go at you. If you offer a service and the clients know all the ins and outs good luck to you.

 

[Herr Tubthumper]

You don't like it, no problem, but there's no need to keep saying you don't like it unless you can actually find some facts/evidence to show why it won't work.

First, this is a chat room. It is for chat and discussion. NSC would be a bit pointless if everyone said "okay, that's your view lets move on." at the first opportunity wouldn't it?

Go back through this thread and you sill see I have posted as much as I can to demonstrate why i am opposed and explained my reasoning and position. There are limitations because its down to interpretation and the advice I sought which I obviously received in summary form. I have also reproduced a HMRC press release, a FT link and US has reproduced an item to demonstrate that some opinion leaders are also opposed to this scheme.

 

[Triggaaar]

First, this is a chat room. It is for chat and discussion. NSC would be a bit pointless if everyone said "okay, that's your view lets move on." at the first opportunity wouldn't it?

Yes, but it's not like this is your first opportunity. You said you didn't think the sceme worked and you'd been advised against it, and then on the next page you said the same thing, and then on the next page you said the same thing.

There are limitations because its down to interpretation

That's tax for you.

I have also reproduced a HMRC press release, a FT link and US has reproduced an item to demonstrate that some opinion leaders are also opposed to this scheme.

Firstly, you posted that while I was writing my post. Secondly, the press release does not demonstrate that opinion leaders are opposed to 'this scheme', because they are discussing several ideas, and they don't seem to be dismissing 'this' idea:

Challenging avoidance

We are now challenging all schemes which we have identified as being in use. These include
where:

• a sub-sale is combined with the subsequent distribution of the property in the form of
a dividend in specie
• a sub-sale is combined with a subsequent claim to alternative finance relief
• it is claimed that combining a sub-sale with a transaction involving a partnership
reduces the consideration chargeable to SDLT by virtue of the special partnership
computational rules
• a sub-sale is combined with a transfer by deed of gift or assignment.

So they are challenging sub-sales. They obviously want to discourage people from saving money, because it's not in their interest. But does it say anywhere that there is a problem with buying a company that owns property?

“It is a common misconception that it is possible to purchase a property using a company and avoid Stamp Duty.

“When a property is purchased through a company, whether based offshore or in the UK, it pays the same rate of Stamp Duty as if it where an individual. Stamp Duty may be avoided by future purchasers when the company decides to sell the property. This is done by the owner selling shares in the company rather than the property itself, but Stamp Duty will be paid on the initial purchase.”

So buying/selling a company that owns a property works then. Getting the property to be owned by the company in the first place may be less straight forward.

 

[Herr Tubthumper]

Does anyone want to change your opinion?

Ask ILOVEBHA. Probably not, but at the very least I'm sure he wants me to think about his responses.

 

[Herr Tubthumper]

Yes, but it's not like this is your first opportunity. You said you didn't think the sceme worked and you'd been advised against it, and then on the next page you said the same thing, and then on the next page you said the same thing.

So what? I've written a fair but and yes I reiterated my position. What's the big deal?

Firstly, you posted that while I was writing my post. Secondly, the press release does not demonstrate that opinion leaders are opposed to 'this scheme'

I was not intending to imply that all three items I listed demonstrate that opinion leaders are opposed. The HMRC release is their current position. The FT link and the US demonstrate that some folk who have also sought due diligence and legal bods have a different view to the one ILOVEBHA has presented. Via these alternative opinions I was merely trying to demonstrate that this is not a clear cut issue and that I do not believe that once a specific time period has lapsed you can forget about it.

 

[Bald Gull]

Retrospective tax legislation just would not work and would open up a whole can of worms...they have never done it before and they normally just close loopholes when they become too expensive and all that happens is another appears to take over.

Just as a matter of interest, when does the process for this scheme need to kick off. Presumably if contracts have been exchanged but deal has not been completed, it is too late?

 

[ILOVEBHA]

Just as a matter of interest, when does the process for this scheme need to kick off. Presumably if contracts have been exchanged but deal has not been completed, it is too late?

Yes you are correct it will need to be before contracts are exchanged and the earlier the better.

 

[Bald Gull]

Yes you are correct it will need to be before contracts are exchanged and the earlier the better.

Damn it!!

Thanks though.

 

[Triggaaar]

The FT link and the US demonstrate that some folk who have also sought due diligence and legal bods have a different view to the one ILOVEBHA has presented.

Do they? They seem to suggest that some schemes will be looked into, and it's possible that not all will be allowed. But does it say anywhere that if you buy a company that owns a property that you will have to pay more than 0.5% tax?

 

[Westdene Seagull]

Well i dont know what schemes or firms you have dealt with in the past but i can 100% guarantee that if the scheme did fail then there is a 100% money back guarantee.
Why are people so dismissive of these schemes, we are a very professional and very well respected firm of Chartered accountants and we have done our due diligence on all the schemes we offer and would not put it to our clients if we did not feel confident in the products on offer.

Looks like your company may well need to start paying money back !

BBC News - Worries over stamp duty avoidance

 

[ILOVEBHA]

Looks like your company may well need to start paying money back !

BBC News - Worries over stamp duty avoidance

Have you actually read the article? it says HMRC are gearing up to a challenge and how many times have we heard this before.
This is a common ploy by HMRC to put people against the idea of taking up a tax avoidance scheme and it does work with certain individuals like Westdene Seagull.
They normally make announcements monthly regarding all tax avoidance schemes as they are clever and know it will work in putting people off.

 

[Herr Tubthumper]

it says HMRC are gearing up to a challenge.

1200 challenges actually. I have read the HMRC have sent out requests for payment of unpaid tax in 1200 choice cases. Any of your clients had a demand?

 

[ILOVEBHA]

1200 challenges actually. I have read the HMRC have sent out requests for payment of unpaid tax in 1200 choice cases. Any of your clients had a demand?

No requests at all.
Dont forget there are many websites and fraudulent people out there offering tax savings and i am sure if people used them then i am not suprised if they get tax bills from HMRC.
Please do not confuse us with them.

 

[Westdene Seagull]

Have you actually read the article? it says HMRC are gearing up to a challenge and how many times have we heard this before.
This is a common ploy by HMRC to put people against the idea of taking up a tax avoidance scheme and it does work with certain individuals like Westdene Seagull.
They normally make announcements monthly regarding all tax avoidance schemes as they are clever and know it will work in putting people off.

Indeed I have read it and here's some key quotes :

From someone involved in the scheme :
"This is an aggressive tax planning move. You are essentially taking tens of thousands of pounds out of the Revenue's pocket. It is not for everyone. We tell our clients there is a 10% chance that they will receive a letter from HMRC challenging their tax return," said Mr Cam.
"My understanding is that everything being done is within the law. HMRC does understand these schemes and they have not yet closed the loopholes," said Mr Cam.


Hardly a ringing endorsement of it's leagality.


From HMRC :


"The schemes rely on an interpretation of law that produces an outcome different from that envisaged when the law was enacted, and that HMRC does not accept."
The tax authority was investigating 1,200 people it believed had underpaid tax totalling £35m.


And this is the key to it all - it really is an interpretation and interpretation by buisnesses that can make a fast buck from said interpretation. I'm sure once HMRC are done with the current 1,200 people they'll move on to the next batch.



From a lawyer :


Law firms have warned against the internet schemes' tactics. "It is a common misconception that it is possible to purchase a property using a company and avoid stamp duty."


So HMRC believe it's a mis-interpretation and lawyers believe it's a misconception - you carry on but I'll stick to paying my proper Stamp Duty level thanks. At the very least I can have the warm feeling that I'm not trying to screw the taxpayers purse.

 

[Herr Tubthumper]

No requests at all.
Dont forget there are many websites and fraudulent people out there offering tax savings and i am sure if people used them then i am not suprised if they get tax bills from HMRC.
Please do not confuse us with them.

Just curious. I have developed a keen interest in this topic via my personal dealings and the discussions on this thread.

 

[ILOVEBHA]

Indeed I have read it and here's some key quotes :

From someone involved in the scheme :
"This is an aggressive tax planning move. You are essentially taking tens of thousands of pounds out of the Revenue's pocket. It is not for everyone. We tell our clients there is a 10% chance that they will receive a letter from HMRC challenging their tax return," said Mr Cam.
"My understanding is that everything being done is within the law. HMRC does understand these schemes and they have not yet closed the loopholes," said Mr Cam.


Hardly a ringing endorsement of it's leagality.


From HMRC :


"The schemes rely on an interpretation of law that produces an outcome different from that envisaged when the law was enacted, and that HMRC does not accept."
The tax authority was investigating 1,200 people it believed had underpaid tax totalling £35m.


And this is the key to it all - it really is an interpretation and interpretation by buisnesses that can make a fast buck from said interpretation. I'm sure once HMRC are done with the current 1,200 people they'll move on to the next batch.



From a lawyer :


Law firms have warned against the internet schemes' tactics. "It is a common misconception that it is possible to purchase a property using a company and avoid stamp duty."


So HMRC believe it's a mis-interpretation and lawyers believe it's a misconception - you carry on but I'll stick to paying my proper Stamp Duty level thanks. At the very least I can have the warm feeling that I'm not trying to screw the taxpayers purse.

Well we believe this is actually a really unagressive tax planning scheme and please dont forget where the quotes come from....
Enjoy your warm feeling as these tax schemes have been going on and will continue for ever.