Umbrella company contractors and other freelance workers have been warned to be cautious of schemes that claim to be HMRC approved, when really they are referring to the reference number allocated to a scheme.
A spokesperson from the Revenue pointed out that just because HMRC has issued a scheme reference number, it does not mean that it approves the scheme or that it accepts that the scheme accomplishes the tax advantages it intends. Furthermore, even though a scheme claims to be approved by HMRC, it doesn’t necessarily mean that the statement is true.
HMRC says that there are some indicators to bear in mind when tax planning, one of which is the HMRC approved stamp. The Revenue could see this as an indication of tax avoidance and lead it to challenge a person’s Self Assessment tax return.
Other indicators to watch out for are schemes that sound too good to be true, confidentiality or secrecy arrangements and the use of offshore companies or trust for no logical commercial reason.
Meanwhile, the government is starting talks with three overseas tax havens in a bid to raise an additional £10bn by 2015.
George Osborne has confirmed that the UK is already having discussions with the Swiss government and the Alpine state could help in the taxation of British citizens’ assets held in secret accounts.
A recently struck banking transparency arrangement with Liechtenstein seems to be working very well and
delivering more than expected. Similar arrangements could be set up with the still to be identified three tax havens. If all the deals are concluded successfully, the government estimates it will raise £10bn in the coming years.
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Image: Relaxing in Maldives by nattu
