Journey to 0% taxes

[BritishSecret]

How do you transfer money from a UK LLC bank account to a tax haven bank account (Lets say, a Cayman Islands LLC) in order to avoid paying any income tax whatsoever?

My general understanding is it's highly frowned upon to send it directly. This is because it will immediately get flagged for tax and as a result you need to 'bounce it around' so to speak using LLCs in places like Malta, Cyprus and the Channel Islands.

Can someone please explain the journey of that money from a UK LLC bank account to a tax haven bank account to me, as I can't figure out the exact path people actually used to avoid paying any income tax. I understand it changes over time, but I believe there's got to be some paths that have stuck around over time.

 

[JohnnyDoe]

It’s a journey that ends in HMPS:

Revenue fraud – Sentencing

www.sentencingcouncil.org.uk

Fraud: Cheat the public revenue, common law
Triable on indictment only
Maximum: Life imprisonment
Offence range: 3 – 17 years’ custody

Doubling the maximum prison term for the most egregious examples of tax fraud

www.gov.uk

 

[BritishSecret]

no I'm obviously trying not to commit that, I wish to be completely within the law, I'm trying to learn about tax avoidance not tax evasion

 

[JohnnyDoe]

no I'm obviously trying not to commit that, I wish to be completely within the law, I'm trying to learn about tax avoidance not tax evasion

You live in the UK, you pay taxes in the UK. Simple.

 

[cuno]

Relocate to a country where the tax rate suites you and live style is acceptable.

 

[Sols]

How do you transfer money from a UK LLC bank account to a tax haven bank account (Lets say, a Cayman Islands LLC) in order to avoid paying any income tax whatsoever?

You don't. The HMRC has an arsenal of regulations and tools to come after you if you do. Not worth the risk.

BEPS (Base Erosion and Profit Shifting) regulations are your main problem. But there are many others.

 

[BritishSecret]

So you believe there is no legal way in any way shape or form of moving any money that is located in the UK banking system to a tax haven to reduce overall taxes?? As an example, I'm pretty sure the business of wealth management in the UK uses jurisdictions like Jersey, Guernsey, Cayman Islands and Bermuda to help people protect their wealth by using LLCs and trusts in these offshore locations. This is done to help legally avoid (NOT EVADE) taxes. Yes there is a fine line between evasion and avoiding and so as a result I am trying to learn about avoiding taxes not evading. I am fully aware of the legal implications of doing tax evasion.

Relocate to a country where the tax rate suites you and live style is acceptable.

So the solution is to first start the income on paper in a country that has suitable tax rate, i.e don't start with an LLC in the UK but rather a UK linked territory such as Jersey or Guernsey

Relocate to a country where the tax rate suites you and live style is acceptable.

And is residence really that big of a deal? I had learnt that the residence of an LLC CEO or shareholder doesn't really matter, only where all the money is located, on paper?

It’s a journey that ends in HMPS:

Revenue fraud – Sentencing

www.sentencingcouncil.org.uk

Fraud: Cheat the public revenue, common law
Triable on indictment only
Maximum: Life imprisonment
Offence range: 3 – 17 years’ custody

Doubling the maximum prison term for the most egregious examples of tax fraud

www.gov.uk

Also thanks for the laughing emoji reactions guys, I'm trying to learn and that felt quite mean. I can now see that I held a belief that was incorrect, thanks sols for the info

 

[Sols]

So you believe there is no legal way in any way shape or form of moving any money that is located in the UK banking system to a tax haven to reduce overall taxes?? As an example, I'm pretty sure the business of wealth management in the UK uses jurisdictions like Jersey, Guernsey, Cayman Islands and Bermuda to help people protect their wealth by using LLCs and trusts in these offshore locations. This is done to help legally avoid (NOT EVADE) taxes. Yes there is a fine line between evasion and avoiding and so as a result I am trying to learn about avoiding taxes not evading. I am fully aware of the legal implications of doing tax evasion.

The mistake a lot of people make is they read news headlines about big companies and UHNWI not paying tax, and assume that there is some trick they can use for their own SME or for their own personal savings/investment funds. Setting things up the way those companies and people do will cost more than what you might be paying in tax.

It's true that you can get away paying nearly zero tax by moving the money to Bermuda. But you need to have staff in Bermuda and a genuine tax residence there, and there needs to be a preexisting agreement whereby for example the Bermuda company leases intellectual property to the UK company. Doing all that easily has five or six figure costs on a yearly basis.

 

[manukahoney]

You can move your money between your bank accounts as you wish. It doesn't affect your tax burden, because all the banks will report you to your country of residence and in the UK it is your responsibility to file a tax report and show your income.

There are some legit ways to minimise your taxes in the UK:
1) be a non-dom and have your foreign income not remitted in the UK. As long as it's a passive income and you file for remittance basis - you will pay 0 taxes on this money
2) transfer the ownership of assets to a trusted third party - that can be a professional trust, a corporation managed by real people in low/zero tax jurisdiction or even a trusted person/family member who lives in let's say Cayman and manages your funds. Again - as long as the management is done overseas and there is no remittance - you will be fine.
One potential workaround - gifts are not taxed in the UK.
3) use many investment schemes in the UK - SEIS, IES, maximise your pension pots etc.

However if you already have income accumulated in the UK - you will probably pay your income tax. Best option will be to use SEIS funds - the tax incentive is insane (about 70%).

 

[jafo]

So you believe there is no legal way in any way shape or form of moving any money that is located in the UK banking system to a tax haven to reduce overall taxes?? As an example, I'm pretty sure the business of wealth management in the UK uses jurisdictions like Jersey, Guernsey, Cayman Islands and Bermuda to help people protect their wealth by using LLCs and trusts in these offshore locations. This is done to help legally avoid (NOT EVADE) taxes. Yes there is a fine line between evasion and avoiding and so as a result I am trying to learn about avoiding taxes not evading. I am fully aware of the legal implications of doing tax evasion.


So the solution is to first start the income on paper in a country that has suitable tax rate, i.e don't start with an LLC in the UK but rather a UK linked territory such as Jersey or Guernsey


And is residence really that big of a deal? I had learnt that the residence of an LLC CEO or shareholder doesn't really matter, only where all the money is located, on paper?


Also thanks for the laughing emoji reactions guys, I'm trying to learn and that felt quite mean. I can now see that I held a belief that was incorrect, thanks sols for the info

Don't take it personally! I read all this stuff daily, but I still do it my way .
A lot of these answers trigger me at first, but I sit back and think through them. I find out WHY I'm having cognizance dissonance bouts. I address them. I find solutions to them.

The best way to think of "tax agencies and their employees" is the way a prosecutor explained it to me when I was in my teens:

"Imagine you are walking tonight in a gang-infested neighborhood and on the corner of Wishful Ave. & Thinking street, you run into e.g. the Crips And Bloods gang. They are heavily armed. You are outnumbered & unarmed. They are going to rob you! They handcuff you. Take you in front of their local "prosecutor" (another gang member), who tells you they'll give you a fair "trial" and allow you to explain to them why you shouldn't be robbed by taking you in front of another gang member they call "the judge". He says he's impartial, but his salary comes from the money they ROB from you! They allow you to hire your own lawyer, who is licensed by them and works with them every day. Now, you MUST think about self-preservation, so...

(1) How can you minimize the theft tonight?
(2) What can you do tonight to live another day?
(3) It's finally another day. You have survived, albeit with much less net worth. What can YOU do to avoid being robbed again in the future?"


That's what everyone here is trying to explain to you!

Good luck!

 

[Larin]

And is residence really that big of a deal? I had learnt that the residence of an LLC CEO or shareholder doesn't really matter, only where all the money is located, on paper?

Aside from everything else that you posted, this is objectively the most incorrect statement of them all.

You have learned wrong. You should re-learn everything from scratch from completely different sources.

You cannot simply move money from a UK bank account to an offshore jurisdiction and thereby not have to pay tax on that money.

 

[polonieth]

I can't figure out the exact path people actually used to avoid paying any income tax.

Are there any examples of British residents who pay zero income tax while living on UK shores?

 

[manukahoney]

Are there any examples of British residents who pay zero income tax while living on UK shores?

Tax on foreign income

Find out whether you need to pay UK tax on foreign income - residence and ‘non-dom’ status, tax returns, claiming relief if you’re taxed twice (including certificates of residence)

www.gov.uk

That's on personal level.
And there is a whole industry of trusts for those who can afford it. UK has many options for people with money to pay as little tax as they want.

 

[BritishSecret]

You can move your money between your bank accounts as you wish. It doesn't affect your tax burden, because all the banks will report you to your country of residence and in the UK it is your responsibility to file a tax report and show your income.

There are some legit ways to minimise your taxes in the UK:
1) be a non-dom and have your foreign income not remitted in the UK. As long as it's a passive income and you file for remittance basis - you will pay 0 taxes on this money
2) transfer the ownership of assets to a trusted third party - that can be a professional trust, a corporation managed by real people in low/zero tax jurisdiction or even a trusted person/family member who lives in let's say Cayman and manages your funds. Again - as long as the management is done overseas and there is no remittance - you will be fine.
One potential workaround - gifts are not taxed in the UK.
3) use many investment schemes in the UK - SEIS, IES, maximise your pension pots etc.

However if you already have income accumulated in the UK - you will probably pay your income tax. Best option will be to use SEIS funds - the tax incentive is insane (about 70%).

So transfer everything to a professional trust or a corporation managed by real people in Cayman and on paper have them manages all my funds (Bank Accounts), liabilities (cars, real estate etc). As long as the management is done overseas and there is no remittance, I will be fine, right?

Don't take it personally! I read all this stuff daily, but I still do it my way .
A lot of these answers trigger me at first, but I sit back and think through them. I find out WHY I'm having cognizance dissonance bouts. I address them. I find solutions to them.

The best way to think of "tax agencies and their employees" is the way a prosecutor explained it to me when I was in my teens:

"Imagine you are walking tonight in a gang-infested neighborhood and on the corner of Wishful Ave. & Thinking street, you run into e.g. the Crips And Bloods gang. They are heavily armed. You are outnumbered & unarmed. They are going to rob you! They handcuff you. Take you in front of their local "prosecutor" (another gang member), who tells you they'll give you a fair "trial" and allow you to explain to them why you shouldn't be robbed by taking you in front of another gang member they call "the judge". He says he's impartial, but his salary comes from the money they ROB from you! They allow you to hire your own lawyer, who is licensed by them and works with them every day. Now, you MUST think about self-preservation, so...

(1) How can you minimize the theft tonight?
(2) What can you do tonight to live another day?
(3) It's finally another day. You have survived, albeit with much less net worth. What can YOU do to avoid being robbed again in the future?"


That's what everyone here is trying to explain to you!

Good luck!

So basically the aim is to never ever make money in the UK on paper as you then legally pay no taxes right?

You can move your money between your bank accounts as you wish. It doesn't affect your tax burden, because all the banks will report you to your country of residence and in the UK it is your responsibility to file a tax report and show your income.

There are some legit ways to minimise your taxes in the UK:
1) be a non-dom and have your foreign income not remitted in the UK. As long as it's a passive income and you file for remittance basis - you will pay 0 taxes on this money
2) transfer the ownership of assets to a trusted third party - that can be a professional trust, a corporation managed by real people in low/zero tax jurisdiction or even a trusted person/family member who lives in let's say Cayman and manages your funds. Again - as long as the management is done overseas and there is no remittance - you will be fine.
One potential workaround - gifts are not taxed in the UK.
3) use many investment schemes in the UK - SEIS, IES, maximise your pension pots etc.

However if you already have income accumulated in the UK - you will probably pay your income tax. Best option will be to use SEIS funds - the tax incentive is insane (about 70%).

How would you gift money in the UK to an entity abroad, then?

Tax on foreign income

Find out whether you need to pay UK tax on foreign income - residence and ‘non-dom’ status, tax returns, claiming relief if you’re taxed twice (including certificates of residence)

www.gov.uk

That's on personal level.
And there is a whole industry of trusts for those who can afford it. UK has many options for people with money to pay as little tax as they want.

Agreed, it's a massive way that wealth management makes most of their money after all the UK is home to almost all tax havens jurisdictions for a reason

Aside from everything else that you posted, this is objectively the most incorrect statement of them all.

You have learned wrong. You should re-learn everything from scratch from completely different sources.

You cannot simply move money from a UK bank account to an offshore jurisdiction and thereby not have to pay tax on that money.

Sure, where should I learn from then?

 

[manukahoney]

You do need to seek a professional advice. UK tax code is complicated and there are many ways to legally minimise your taxes, but again - please hire a pro to structure it for you.

 

[Larin]

So transfer everything to a professional trust or a corporation managed by real people in Cayman and on paper have them manages all my funds (Bank Accounts), liabilities (cars, real estate etc). As long as the management is done overseas and there is no remittance, I will be fine, right?


So basically the aim is to never ever make money in the UK on paper as you then legally pay no taxes right?


How would you gift money in the UK to an entity abroad, then?


Agreed, it's a massive way that wealth management makes most of their money after all the UK is home to almost all tax havens jurisdictions for a reason


Sure, where should I learn from then?

As per the post below contact PwC, Delloite and they will be more than happy to assist you.

 

[BritishSecret]

You do need to seek a professional advice. UK tax code is complicated and there are many ways to legally minimise your taxes, but again - please hire a pro to structure it for you.

So I'd need to seek advice from someone who's a tax advisor who specializes in offshore, right?

As per the post below contact PwC, Delloite and they will be more than happy to assist you.

Neat, thanks for the company recommendations, I'll consider them

You can move your money between your bank accounts as you wish. It doesn't affect your tax burden, because all the banks will report you to your country of residence and in the UK it is your responsibility to file a tax report and show your income.

There are some legit ways to minimise your taxes in the UK:
1) be a non-dom and have your foreign income not remitted in the UK. As long as it's a passive income and you file for remittance basis - you will pay 0 taxes on this money
2) transfer the ownership of assets to a trusted third party - that can be a professional trust, a corporation managed by real people in low/zero tax jurisdiction or even a trusted person/family member who lives in let's say Cayman and manages your funds. Again - as long as the management is done overseas and there is no remittance - you will be fine.
One potential workaround - gifts are not taxed in the UK.
3) use many investment schemes in the UK - SEIS, IES, maximise your pension pots etc.

However if you already have income accumulated in the UK - you will probably pay your income tax. Best option will be to use SEIS funds - the tax incentive is insane (about 70%).

And thanks manukahoney your answers have been easily the most helpful I've received, thank you

​

 

[JohnnyDoe]

As per the post below contact PwC, Delloite and they will be more than happy to assist you.

Contact anyone but PwC/Deloitte unless you enjoy wasting time and money.

 

[jafo]

Contact anyone but PwC/Deloitte unless you enjoy wasting time and money.

It's amazing how these so-called experts don't know a fvcking thing but are willing to learn it on our dime. They were NOT willing to learn it on their OWN dime or during their downtime or leisurely time. We're literally paying grown people to read articles, books, and laws for us and then interpret them, and then do things on our behalf, but if anything goes wrong, we go to prison. This is madness!

 

[zzzzzz]

You can move your money between your bank accounts as you wish. It doesn't affect your tax burden, because all the banks will report you to your country of residence and in the UK it is your responsibility to file a tax report and show your income.

There are some legit ways to minimise your taxes in the UK:
1) be a non-dom and have your foreign income not remitted in the UK. As long as it's a passive income and you file for remittance basis - you will pay 0 taxes on this money
2) transfer the ownership of assets to a trusted third party - that can be a professional trust, a corporation managed by real people in low/zero tax jurisdiction or even a trusted person/family member who lives in let's say Cayman and manages your funds. Again - as long as the management is done overseas and there is no remittance - you will be fine.
One potential workaround - gifts are not taxed in the UK.
3) use many investment schemes in the UK - SEIS, IES, maximise your pension pots etc.

However if you already have income accumulated in the UK - you will probably pay your income tax. Best option will be to use SEIS funds - the tax incentive is insane (about 70%).

Can you explain point 2. a bit more? You transfer ownership of your assets to trust/company/person, but what are the ways you can get any money out of this structure with/without any tax? That person can give you gift or cash at 0%, but what about trust/company?

It's amazing how these so-called experts don't know a fvcking thing but are willing to learn it on our dime. They were NOT willing to learn it on their OWN dime or during their downtime or leisurely time. We're literally paying grown people to read articles, books, and laws for us and then interpret them, and then do things on our behalf, but if anything goes wrong, we go to prison. This is madness!

Every advisor/expert leech works with that asimmetry (weatherman, tax, financial, psychologist, M.D., lobbyist, politician, bureaucrat...), they are all full of fancy words, but they don't risk anything and they don't guarantee anything!