The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
This shows how disingenuous some of the above posters have been. All swearing blind that people using these schemes are paying the full level of tax and calling others stupid for not understanding the system. Almost making out like it is a disadvantage because you pay corporation tax and income tax on dividends. It seems, the whole system is designed to obscure and confuse. To my simple mind it feels corrupt.
Much like Dave, many say a part-truth without the giving the whole picture. So thank you @Alwaysneil for balancing some of the above posts that try to paint a picture of no advantage. Especially as you are a professional. Wasn't there also some angle involving interest free loans from the company as well?
Well, now had a quick look at Corbyn's tax return. I would recommend it to everyone. It is the perfect demonstration of an utterly chaotic individual. First, he couldn't find it! This despite the fact that you are supposed to keep tax records for a minimum of 22 months after the tax year to which they relate. He had to ask HMRC for a copy! Second, he filled it in manually. I'm guessing he doesn't have the competence to do it on-line. Third, he appears not to understand that you are supposed to put a cross in either yes or no in some of the sections. There's a whole page of them where he managed just one cross. I'd have dropped him straight into the investigations branch if I'd been at HMRC. Fourth, his handwriting is difficult to decipher. He did not have the courtesy to use block caps to make the HMRC's staff task easier. Fifth, he filed late and had to pay a £100 penalty. Sixth, he made no gift-aided charitable donations during the year. (Feck me Jeremy, even I do that you tight git!) And finally, he is not organised enough to earn any interest on his bank accounts.
Looks like it is "Jezza the Dodger" now. Maybe Dennis Skinner could apologise to the PM for his behaviour yesterday?
There is an irony to your outrage as 24 hours earlier you referred to him as "evasive at best, misleading at worst". The very definition of dodgy!
Not sure why the Beast has to apologise for Jezza's tax return, especially as it was a challange about Dave not answering a question from several years earlier about a similar subject.
The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
This shows how disingenuous some of the above posters have been. All swearing blind that people using these schemes are paying the full level of tax and calling others stupid for not understanding the system. Almost making out like it is a disadvantage because you pay corporation tax and income tax on dividends. It seems, the whole system is designed to obscure and confuse. To my simple mind it feels corrupt.
I broke it down figure by figure, I even went as far as to give two worked examples that showed where every single penny would go. I haven't seen anyone refer to anyone else as stupid either; on the contrary, I felt comfortable enough to ask if anyone more knowledgeable than I could cast an eye on my post to make sure I wasn't spreading misinformation.
There is some frustration by some posters - understandably - as no matter how hard they explained people were continuing to make the situation sound much different. There's political viewpoints getting mixed up in the debate about a practice which goes on all the time by people in all kinds of walks of life, this situation has been compounded by some utterly dreadful reporting.
Forgive me if I'm being defensive, but I get the impression that it was my post that you're implying made out that this method was disadvantageous as you paid both Corporation Tax and Dividends Tax, that's not really what I was trying to convey. I did state that paying yourself via dividends can result in a comparable post-tax amount, which as Alwaysneil has pointed out, is true.
Much like Dave, many say a part-truth without the giving the whole picture. So thank you @Alwaysneil for balancing some of the above posts that try to paint a picture of no advantage. Especially as you are a professional. Wasn't there also some angle involving interest free loans from the company as well?
Getting paid via a loan is what Jimmy Carr was doing, IIRC he took a salary that matched the personal allowance (i.e £11k) and then had an offshore company give him a loan for several thousand pounds every month - as a loan wouldn't be taxed. I haven't seen any mention of that - as that is a much shadier situation.
Needless to say, when he jumped in to the debate on Twitter he was being disingenuous (or even simply deceptive.) to try and compare his scheme with the mechanism in which thousands of contractors, small business owners and shareholders legally pay themselves each month.
The latest article on the Panama Papers website concerning Putin is very interesting
I'm very intrigued by his dealings, as he was very quick to state that the Panama Papers were simply western propaganda aimed at "undermining Russia". I also saw the cracking usage of "Putinophobia" via RussiaToday - my new favourite word!
The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
This shows how disingenuous some of the above posters have been. All swearing blind that people using these schemes are paying the full level of tax and calling others stupid for not understanding the system. Almost making out like it is a disadvantage because you pay corporation tax and income tax on dividends. It seems, the whole system is designed to obscure and confuse. To my simple mind it feels corrupt.
Much like Dave, many say a part-truth without the giving the whole picture. So thank you @Alwaysneil for balancing some of the above posts that try to paint a picture of no advantage. Especially as you are a professional. Wasn't there also some angle involving interest free loans from the company as well?
You want to ask @PragueAddick about the benefits of taking a dividend vs getting paid a salary.
The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
This shows how disingenuous some of the above posters have been. All swearing blind that people using these schemes are paying the full level of tax and calling others stupid for not understanding the system. Almost making out like it is a disadvantage because you pay corporation tax and income tax on dividends. It seems, the whole system is designed to obscure and confuse. To my simple mind it feels corrupt.
Much like Dave, many say a part-truth without the giving the whole picture. So thank you @Alwaysneil for balancing some of the above posts that try to paint a picture of no advantage. Especially as you are a professional. Wasn't there also some angle involving interest free loans from the company as well?
You want to ask @PragueAddick about the benefits of taking a dividend vs getting paid a salary.
The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
This shows how disingenuous some of the above posters have been. All swearing blind that people using these schemes are paying the full level of tax and calling others stupid for not understanding the system. Almost making out like it is a disadvantage because you pay corporation tax and income tax on dividends. It seems, the whole system is designed to obscure and confuse. To my simple mind it feels corrupt.
I broke it down figure by figure, I even went as far as to give two worked examples that showed where every single penny would go. I haven't seen anyone refer to anyone else as stupid either. There as some frustration by some posters - understandably - as no matter how hard they explained people were continuing to make the situation sound much different.
No one claimed the double taxation was a disadvantage either, except perhaps me - and that's when I stated it results in a comparable post-tax amount. Which is true, as Alwaysneil has pointed out.
Much like Dave, many say a part-truth without the giving the whole picture. So thank you @Alwaysneil for balancing some of the above posts that try to paint a picture of no advantage. Especially as you are a professional. Wasn't there also some angle involving interest free loans from the company as well?
Getting paid via a loan is what Jimmy Carr was doing, IIRC he took a salary that matched the personal allowance (i.e £11k) and then had an offshore company give him a loan for several thousand pounds every month - as a loan wouldn't be taxed. I haven't seen any mention of that - as that is a much shadier situation.
The main benefit you get from having a company and paying dividends rather than taking a wage is around national insurance. The combination of corporate and dividend tax is similar to the income tax that would have been paid on a wage.
There are maybe more expenses that can be taken as well.
This shows how disingenuous some of the above posters have been. All swearing blind that people using these schemes are paying the full level of tax and calling others stupid for not understanding the system. Almost making out like it is a disadvantage because you pay corporation tax and income tax on dividends. It seems, the whole system is designed to obscure and confuse. To my simple mind it feels corrupt.
I broke it down figure by figure, I even went as far as to give two worked examples that showed where every single penny would go. I haven't seen anyone refer to anyone else as stupid either. There as some frustration by some posters - understandably - as no matter how hard they explained people were continuing to make the situation sound much different.
No one claimed the double taxation was a disadvantage either, except perhaps me - and that's when I stated it results in a comparable post-tax amount. Which is true, as Alwaysneil has pointed out.
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
No worries, once again - apologies if I come across as defensive! I was (incorrectly) assuming that it was aimed at me, to be quite honest I've probably missed a few pages here too.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight. That said, if you're working full time and paying NI on your salary - like an MP - there would be no gap to worry about, and no incentive for paying additional NI. If you're solely being paid via dividends and a minimal salary then this may not be the case. As I say though.. I find it headache inducing, and I'm not sure at all.
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
No worries, once again - apologies if I come across as defensive! I was (incorrectly) assuming that it was aimed at me, to be quite honest I've probably missed a few pages here too.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight. That said, if you're working full time and paying NI on your salary - like an MP - there would be no gap to worry about, and no incentive for paying additional NI. If you're solely being paid via dividends and a minimal salary then this may not be the case. As I say though.. I find it headache inducing, and I'm not sure at all.
That is probably more the point, who doesn't find it headache inducing? What service does it provide if no one truly understands the whole system? Surely it is unfit for purpose.
It must cost more money to check an over-complicated system and it must leave more loopholes. Why is there such resistance to a more simplified code?
I recently got fined for not paying tax on an in work benefit despite HRMC being in possession of overpaid tax at the same time. So maybe I'm just sore about the issue!
Personally I'm surprised more has not be made about Dave clearly dodging inheritance tax. But on the whole not many people seem to enjoy the idea of inheritance tax! Having been through the experience of probate, I think 350 of tax free money is a generous start. Even more so as it was not really mine, it was someone else's life and achievement/earnings.
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
No worries, once again - apologies if I come across as defensive! I was (incorrectly) assuming that it was aimed at me, to be quite honest I've probably missed a few pages here too.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight. That said, if you're working full time and paying NI on your salary - like an MP - there would be no gap to worry about, and no incentive for paying additional NI. If you're solely being paid via dividends and a minimal salary then this may not be the case. As I say though.. I find it headache inducing, and I'm not sure at all.
That is probably more the point, who doesn't find it headache inducing? What service does it provide if no one truly understands the whole system? Surely it is unfit for purpose.
It must cost more money to check an over-complicated system and it must leave more loopholes. Why is there such resistance to a more simplified code?
I recently got fined for not paying tax on an in work benefit despite HRMC being in possession of overpaid tax at the same time. So maybe I'm just sore about the issue!
Personally I'm surprised more has not be made about Dave clearly dodging inheritance tax. But on the whole not many people seem to enjoy the idea of inheritance tax! Having been through the experience of probate, I think 350 of tax free money is a generous start. Even more so as it was not really mine, it was someone else's life and achievement/earnings.
I'm not at all surprised about the inheritance tax issue. The numbers who do precisely the same thing will be huge - it is, after all, one of the easiest things to do, if you want to reduce (legally) the tax you have to pay, provided that the person giving the gift will live for 7 years or more.
I would be amazed if any journalist would think it worth investigating and even more if any media company owner didn't do precisely the same thing.
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
No worries, once again - apologies if I come across as defensive! I was (incorrectly) assuming that it was aimed at me, to be quite honest I've probably missed a few pages here too.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight. That said, if you're working full time and paying NI on your salary - like an MP - there would be no gap to worry about, and no incentive for paying additional NI. If you're solely being paid via dividends and a minimal salary then this may not be the case. As I say though.. I find it headache inducing, and I'm not sure at all.
That is probably more the point, who doesn't find it headache inducing? What service does it provide if no one truly understands the whole system? Surely it is unfit for purpose.
It must cost more money to check an over-complicated system and it must leave more loopholes. Why is there such resistance to a more simplified code?
I recently got fined for not paying tax on an in work benefit despite HRMC being in possession of overpaid tax at the same time. So maybe I'm just sore about the issue!
Personally I'm surprised more has not be made about Dave clearly dodging inheritance tax. But on the whole not many people seem to enjoy the idea of inheritance tax! Having been through the experience of probate, I think 350 of tax free money is a generous start. Even more so as it was not really mine, it was someone else's life and achievement/earnings.
Sure a simplified system would be good, in the main. When I was at school doing economics, a teacher suggested the whole benefits system (and all its staff) should be abolished and for those deserving of extra Government funding, reverse income tax could be applied instead. Now I'm sure such as system would create winners and losers.
Initially, UKIP had as its stated policy the abolition of NICs (presumably only employees contributions) with a corresponding increase in income tax rates. A simple idea. And one I think that Osborne has also looked at. The problem was that pensioners don't pay NICs and would not have voted to pay away another 10% or whatever of their pension in tax. So to compensate, you'd have to give pensioners larger personal allowances. And so the complexity goes on. It got kicked into the long grass.
If half the effort went into checking the finances of the really wealthy individuals, who spend fortunes dodging paying UK tax as was spent on a few middle earners from Westminster, then something good may have come out this whole pointless revelation.
Still, as long as HMRC get a backdated cheque for £180 from Jezza, all is well in the World.
You are correct to say that the extra tax is neither here nor there. That is not the point though. What the tax return and it's late filing show is that this odious, shambolic individual's financial affairs are a chaotic mess. It is a clear indication that he is totally disorganised and unfit for high office.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
Or maybe does, but he just doesn't claim back the tax on them?
I give loads to charity over the course of a year, but I'm fucked if I can remember all the payments when it comes to tax return time, so I don't bother with it.
If half the effort went into checking the finances of the really wealthy individuals, who spend fortunes dodging paying UK tax as was spent on a few middle earners from Westminster, then something good may have come out this whole pointless revelation.
Still, as long as HMRC get a backdated cheque for £180 from Jezza, all is well in the World.
You are correct to say that the extra tax is neither here nor there. That is not the point though. What the tax return and it's late filing show is that this odious, shambolic individual's financial affairs are a chaotic mess. It is a clear indication that he is totally disorganised and unfit for high office.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
I give to charity, don't include it on my tax return. I don't think I have to unless I want to claim the tax back do I? So it either tells me he gave and didn't claim or he didn't give. So not much really. But in case you were interested the Labour leader in Scotland got paid for a newspaper column, paid tax on it then gave the full amount to charity.
I also studied economics, my teacher said something similar, he offered policies like the one you suggested in a previous post. One that targeted savings amongst low earners.
Not sure if bucket mostly works you should ignore the holes because it is a pain to get s new one.
In 2014 pensioners amounted to roughly 40% of all welfare spending. Pensions are 12% of the entire system. Yet this has been an area of the budget ring fenced because you have a government too scared of it's voter base to do something good yet painful for the country. I think that of every government since Thatcher I should add.
I was recently speaking to two pensioners, who both earn annually more than the average wage. They were horrified when I suggested taking away their TV license and bus pass. Both of which they hardly used. I think the time of universal benefit is dead. Even more so when you have a system that allows people, who can afford to pay tax, to not.
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
No worries, once again - apologies if I come across as defensive! I was (incorrectly) assuming that it was aimed at me, to be quite honest I've probably missed a few pages here too.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight. That said, if you're working full time and paying NI on your salary - like an MP - there would be no gap to worry about, and no incentive for paying additional NI. If you're solely being paid via dividends and a minimal salary then this may not be the case. As I say though.. I find it headache inducing, and I'm not sure at all.
That is probably more the point, who doesn't find it headache inducing? What service does it provide if no one truly understands the whole system? Surely it is unfit for purpose.
It must cost more money to check an over-complicated system and it must leave more loopholes. Why is there such resistance to a more simplified code?
I recently got fined for not paying tax on an in work benefit despite HRMC being in possession of overpaid tax at the same time. So maybe I'm just sore about the issue!
Personally I'm surprised more has not be made about Dave clearly dodging inheritance tax. But on the whole not many people seem to enjoy the idea of inheritance tax! Having been through the experience of probate, I think 350 of tax free money is a generous start. Even more so as it was not really mine, it was someone else's life and achievement/earnings.
I'm not at all surprised about the inheritance tax issue. The numbers who do precisely the same thing will be huge - it is, after all, one of the easiest things to do, if you want to reduce (legally) the tax you have to pay, provided that the person giving the gift will live for 7 years or more.
I would be amazed if any journalist would think it worth investigating and even more if any media company owner didn't do precisely the same thing.
It's legal for a 80 year old to shag a 16 year old but it still doesn't feel right to me! More so that Dave has played on our sense of responsibility to the nation.
If half the effort went into checking the finances of the really wealthy individuals, who spend fortunes dodging paying UK tax as was spent on a few middle earners from Westminster, then something good may have come out this whole pointless revelation.
Still, as long as HMRC get a backdated cheque for £180 from Jezza, all is well in the World.
You are correct to say that the extra tax is neither here nor there. That is not the point though. What the tax return and it's late filing show is that this odious, shambolic individual's financial affairs are a chaotic mess. It is a clear indication that he is totally disorganised and unfit for high office.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
I give to charity, don't include it on my tax return. I don't think I have to unless I want to claim the tax back do I? So it either tells me he gave and didn't claim or he didn't give. So not much really. But in case you were interested the Labour leader in Scotland got paid for a newspaper column, paid tax on it then gave the full amount to charity.
I also studied economics, my teacher said something similar, he offered policies like the one you suggested in a previous. One that targeted savings amongst low earners.
Not sure if bucket mostly works you should ignore the holes because it is a pain to get s new one.
In 2014 pensioners amounted to roughly 40% of all welfare spending. Pensions are 12% of the entire system. Yet this has been an area of the budget ring fenced because you have a government too scared of it's voter base to do something good yet painful for the country. I think that of every government since Thatcher I should add.
I was recently speaking to two pensioners, who both earn annually more than the average wage. They were horrified when I suggested taking away their TV license and bus pass. Both of which they hardly used. I think the time of universal benefit is dead. Even more so when you have a system that allows people, who can afford to pay tax, to not.
Yes, but pensioners pay tax too.
This report from a year ago citing earlier tax years: The average household income for pensioners rose by £500 to £21,800, with over 30% of that handed to the taxman in direct and indirect taxes.
In total, pensioners paid £47.26 billion in taxes during 2012-13. On average pensioner households paid £3,900 in indirect taxes and £2,600 in direct taxes in the 2012-13 tax year.
So, what might be paid out in benefits gets straight back to HMT anyway In the main, what it's probably not doing is going on a new tattoo, to Bet365 in Gibraltar*, or on a dozen bottles of Frosty Jack's.
Pensioners vote, and as you say, they resent any suggestion that the little perks they get should be removed. So, no political party is going to risk getting slaughtered at a General Election by upsetting them.
BTW, in case you are interested Cameron wrote a book, and the royalty receipts were donated to charity.
*Going off piste here but Peter Coates, a director of Bet365 has donated hundreds of thousands of pounds to the party. One particularly large donation coincided with the relaxation of gambling legislation and the lifting of a ban on television advertising by the Labour government. So the next time you wince as Ray Winstone mangles the English language in one of their ads, you know who to blame.
If half the effort went into checking the finances of the really wealthy individuals, who spend fortunes dodging paying UK tax as was spent on a few middle earners from Westminster, then something good may have come out this whole pointless revelation.
Still, as long as HMRC get a backdated cheque for £180 from Jezza, all is well in the World.
You are correct to say that the extra tax is neither here nor there. That is not the point though. What the tax return and it's late filing show is that this odious, shambolic individual's financial affairs are a chaotic mess. It is a clear indication that he is totally disorganised and unfit for high office.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
I give to charity, don't include it on my tax return. I don't think I have to unless I want to claim the tax back do I? So it either tells me he gave and didn't claim or he didn't give. So not much really. But in case you were interested the Labour leader in Scotland got paid for a newspaper column, paid tax on it then gave the full amount to charity.
I also studied economics, my teacher said something similar, he offered policies like the one you suggested in a previous. One that targeted savings amongst low earners.
Not sure if bucket mostly works you should ignore the holes because it is a pain to get s new one.
In 2014 pensioners amounted to roughly 40% of all welfare spending. Pensions are 12% of the entire system. Yet this has been an area of the budget ring fenced because you have a government too scared of it's voter base to do something good yet painful for the country. I think that of every government since Thatcher I should add.
I was recently speaking to two pensioners, who both earn annually more than the average wage. They were horrified when I suggested taking away their TV license and bus pass. Both of which they hardly used. I think the time of universal benefit is dead. Even more so when you have a system that allows people, who can afford to pay tax, to not.
Yes, but pensioners pay tax too.
This report from a year ago citing earlier tax years: The average household income for pensioners rose by £500 to £21,800, with over 30% of that handed to the taxman in direct and indirect taxes.
In total, pensioners paid £47.26 billion in taxes during 2012-13. On average pensioner households paid £3,900 in indirect taxes and £2,600 in direct taxes in the 2012-13 tax year.
So, what might be paid out in benefits gets straight back to HMT anyway In the main, what it's probably not doing is going on a new tattoo, to Bet365 in Gibraltar*, or on a dozen bottles of Frosty Jack's.
Pensioners vote, and as you say, they resent any suggestion that the little perks they get should be removed. So, no political party is going to risk getting slaughtered at a General Election by upsetting them.
BTW, in case you are interested Cameron wrote a book, and the royalty receipts were donated to charity.
*Going off piste here but Peter Coates, a director of Bet365 has donated hundreds of thousands of pounds to the party. One particularly large donation coincided with the relaxation of gambling legislation and the lifting of a ban on television advertising by the Labour government. So the next time you wince as Ray Winstone mangles the English language in one of their ads, you know who to blame.
Yeah, it all seems corrupt. No matter the political taste.
You emphasised my point,we will never have a political Leader while they follow opinion polls. Also that they resent any suggestion of the removal of 'perks'. Surely if the logic is sound, it should be entertained? Equally, I thought benefits were for the needy not considered 'perks' of old age.
There is no comparison with your figures so them mean little (no offence meant). I could not see the proportion of pensioners that pay income tax. Your figures have to be relative to non pension households. I pay 30% on income and NI let alone indirect taxes. Everyone pays indirect tax so that would be an interesting comparison. I imagine it would be a higher proportion of the non-pension household. The spread of proportion of indirect tax to the household based on dirstribution of wealth would also be interesting.
Did Cameron include the donation on his tax return? Treating a charitable donation as a tax deductible might come across as a little self-serving!
I wasn't referring to you and I'm very grateful for the people who have experience of this for taking the time to explain it to a laymen. I'm not going to dig people out and get quotes but go back a few pages, they are there. From both sides to be fair.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
No worries, once again - apologies if I come across as defensive! I was (incorrectly) assuming that it was aimed at me, to be quite honest I've probably missed a few pages here too.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight. That said, if you're working full time and paying NI on your salary - like an MP - there would be no gap to worry about, and no incentive for paying additional NI. If you're solely being paid via dividends and a minimal salary then this may not be the case. As I say though.. I find it headache inducing, and I'm not sure at all.
That is probably more the point, who doesn't find it headache inducing? What service does it provide if no one truly understands the whole system? Surely it is unfit for purpose.
It must cost more money to check an over-complicated system and it must leave more loopholes. Why is there such resistance to a more simplified code?
I recently got fined for not paying tax on an in work benefit despite HRMC being in possession of overpaid tax at the same time. So maybe I'm just sore about the issue!
Personally I'm surprised more has not be made about Dave clearly dodging inheritance tax. But on the whole not many people seem to enjoy the idea of inheritance tax! Having been through the experience of probate, I think 350 of tax free money is a generous start. Even more so as it was not really mine, it was someone else's life and achievement/earnings.
I'm not at all surprised about the inheritance tax issue. The numbers who do precisely the same thing will be huge - it is, after all, one of the easiest things to do, if you want to reduce (legally) the tax you have to pay, provided that the person giving the gift will live for 7 years or more.
I would be amazed if any journalist would think it worth investigating and even more if any media company owner didn't do precisely the same thing.
It's legal for a 80 year old to shag a 16 year old but it still doesn't feel right to me! More so that Dave has played on our sense of responsibility to the nation.
As far as I am aware, the inheritance tax thing is almost ubiquitous - I know of several families of limited means (at least compared to any MP) where it has been used as part of the transfer of a family home. I would fully expect that any accountant would advise their clients of the benefits; it's been available in one form or another for decades.
And, a bit like the 80 year old and the 16 year old, as long as the parties are fully aware of what they are doing, and happy, what's the problem??? Lots of things don't feel right to me, but I do not feel that it's my place to say that they should be made illegal - though I could be convinced in certain cases.
If half the effort went into checking the finances of the really wealthy individuals, who spend fortunes dodging paying UK tax as was spent on a few middle earners from Westminster, then something good may have come out this whole pointless revelation.
Still, as long as HMRC get a backdated cheque for £180 from Jezza, all is well in the World.
You are correct to say that the extra tax is neither here nor there. That is not the point though. What the tax return and it's late filing show is that this odious, shambolic individual's financial affairs are a chaotic mess. It is a clear indication that he is totally disorganised and unfit for high office.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
I give to charity, don't include it on my tax return. I don't think I have to unless I want to claim the tax back do I? So it either tells me he gave and didn't claim or he didn't give. So not much really. But in case you were interested the Labour leader in Scotland got paid for a newspaper column, paid tax on it then gave the full amount to charity.
I also studied economics, my teacher said something similar, he offered policies like the one you suggested in a previous. One that targeted savings amongst low earners.
Not sure if bucket mostly works you should ignore the holes because it is a pain to get s new one.
In 2014 pensioners amounted to roughly 40% of all welfare spending. Pensions are 12% of the entire system. Yet this has been an area of the budget ring fenced because you have a government too scared of it's voter base to do something good yet painful for the country. I think that of every government since Thatcher I should add.
I was recently speaking to two pensioners, who both earn annually more than the average wage. They were horrified when I suggested taking away their TV license and bus pass. Both of which they hardly used. I think the time of universal benefit is dead. Even more so when you have a system that allows people, who can afford to pay tax, to not.
Yes, but pensioners pay tax too.
This report from a year ago citing earlier tax years: The average household income for pensioners rose by £500 to £21,800, with over 30% of that handed to the taxman in direct and indirect taxes.
In total, pensioners paid £47.26 billion in taxes during 2012-13. On average pensioner households paid £3,900 in indirect taxes and £2,600 in direct taxes in the 2012-13 tax year.
So, what might be paid out in benefits gets straight back to HMT anyway In the main, what it's probably not doing is going on a new tattoo, to Bet365 in Gibraltar*, or on a dozen bottles of Frosty Jack's.
Pensioners vote, and as you say, they resent any suggestion that the little perks they get should be removed. So, no political party is going to risk getting slaughtered at a General Election by upsetting them.
BTW, in case you are interested Cameron wrote a book, and the royalty receipts were donated to charity.
*Going off piste here but Peter Coates, a director of Bet365 has donated hundreds of thousands of pounds to the party. One particularly large donation coincided with the relaxation of gambling legislation and the lifting of a ban on television advertising by the Labour government. So the next time you wince as Ray Winstone mangles the English language in one of their ads, you know who to blame.
Yeah, it all seems corrupt. No matter the political taste.
You emphasised my point,we will never have a political Leader while they follow opinion polls. Also that they resent any suggestion of the removal of 'perks'. Surely if the logic is sound, it should be entertained? Equally, I thought benefits were for the needy not considered 'perks' of old age.
There is no comparison with your figures so them mean little (no offence meant). I could not see the proportion of pensioners that pay income tax. Your figures have to be relative to non pension households. I pay 30% on income and NI let alone indirect taxes. Everyone pays indirect tax so that would be an interesting comparison. I imagine it would be a higher proportion of the non-pension household. The spread of proportion of indirect tax to the household based on dirstribution of wealth would also be interesting.
Did Cameron include the donation on his tax return? Treating a charitable donation as a tax deductible might come across as a little self-serving!
Well, that's made me feel REALLY good about gift aiding my donations (which, looks the same to me).
If half the effort went into checking the finances of the really wealthy individuals, who spend fortunes dodging paying UK tax as was spent on a few middle earners from Westminster, then something good may have come out this whole pointless revelation.
Still, as long as HMRC get a backdated cheque for £180 from Jezza, all is well in the World.
You are correct to say that the extra tax is neither here nor there. That is not the point though. What the tax return and it's late filing show is that this odious, shambolic individual's financial affairs are a chaotic mess. It is a clear indication that he is totally disorganised and unfit for high office.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
I give to charity, don't include it on my tax return. I don't think I have to unless I want to claim the tax back do I? So it either tells me he gave and didn't claim or he didn't give. So not much really. But in case you were interested the Labour leader in Scotland got paid for a newspaper column, paid tax on it then gave the full amount to charity.
I also studied economics, my teacher said something similar, he offered policies like the one you suggested in a previous. One that targeted savings amongst low earners.
Not sure if bucket mostly works you should ignore the holes because it is a pain to get s new one.
In 2014 pensioners amounted to roughly 40% of all welfare spending. Pensions are 12% of the entire system. Yet this has been an area of the budget ring fenced because you have a government too scared of it's voter base to do something good yet painful for the country. I think that of every government since Thatcher I should add.
I was recently speaking to two pensioners, who both earn annually more than the average wage. They were horrified when I suggested taking away their TV license and bus pass. Both of which they hardly used. I think the time of universal benefit is dead. Even more so when you have a system that allows people, who can afford to pay tax, to not.
Yes, but pensioners pay tax too.
This report from a year ago citing earlier tax years: The average household income for pensioners rose by £500 to £21,800, with over 30% of that handed to the taxman in direct and indirect taxes.
In total, pensioners paid £47.26 billion in taxes during 2012-13. On average pensioner households paid £3,900 in indirect taxes and £2,600 in direct taxes in the 2012-13 tax year.
So, what might be paid out in benefits gets straight back to HMT anyway In the main, what it's probably not doing is going on a new tattoo, to Bet365 in Gibraltar*, or on a dozen bottles of Frosty Jack's.
Pensioners vote, and as you say, they resent any suggestion that the little perks they get should be removed. So, no political party is going to risk getting slaughtered at a General Election by upsetting them.
BTW, in case you are interested Cameron wrote a book, and the royalty receipts were donated to charity.
*Going off piste here but Peter Coates, a director of Bet365 has donated hundreds of thousands of pounds to the party. One particularly large donation coincided with the relaxation of gambling legislation and the lifting of a ban on television advertising by the Labour government. So the next time you wince as Ray Winstone mangles the English language in one of their ads, you know who to blame.
Yeah, it all seems corrupt. No matter the political taste.
You emphasised my point,we will never have a political Leader while they follow opinion polls. Also that they resent any suggestion of the removal of 'perks'. Surely if the logic is sound, it should be entertained? Equally, I thought benefits were for the needy not considered 'perks' of old age.
There is no comparison with your figures so them mean little (no offence meant). I could not see the proportion of pensioners that pay income tax. Your figures have to be relative to non pension households. I pay 30% on income and NI let alone indirect taxes. Everyone pays indirect tax so that would be an interesting comparison. I imagine it would be a higher proportion of the non-pension household. The spread of proportion of indirect tax to the household based on dirstribution of wealth would also be interesting.
Did Cameron include the donation on his tax return? Treating a charitable donation as a tax deductible might come across as a little self-serving!
You are, of course, correct. I've got a bus pass and take the winter fuel allowance. The former because it's quite useful the latter because I think I've paid enough tax over my life, so sod 'em. However, a few years ago, I watched someone from Help the Aged (now rebranded Age UK, I believe) being interviewed on TV about the winter fuel allowance. His argument on not means-testing it was two-fold. First, it would cost more to organise and administer the means testing than it would actually save. Second, there would inevitably be deserving cases that slipped through the net because it would be more difficult for them to apply for the benefit and they might not bother.
As for your question. Difficult to say. Neither Cameron or Osborne provided pdfs of their actual return. Instead they posted up letters from their accountants setting down the main points. The royalties on the book are shown as income. There is then a note explaining that it was paid away as a charitable donation. You're right about the self-serving thing. I suppose a cute politician with a favourite charity might say they increased the amount donated by an amount equivalent to the tax rebate! (BTW, I was amused to see that Osborne carefully included the £3 interest paid by his bank on his return, so he could pay the extra tax on it!)
I do have mixed feelings about the transfer of a family home. Also, I realise it is not that staight forward in many cases. If the rules allow estates that can afford the tax to not pay, then surely the rules are unfit.
I wasn't suggesting things to be made illegal, just that you can have situations where by it is both legal and many would consider immoral. As you say, it is subjective. Dave has preached to us though about our responsibility while seeming to have the means to pay for it and hasn't.
Emma Watson, Sarah Ferguson, Heather Mills, Simon Cowell and Paul Burrel all have accounts in Panama with this firm. Watson does this for privacy apparently - wonder why the others have accounts there?
All the outrage about rich bastards avoiding tax and I'm wondering how many who are so outraged work for companies operating flex benefit schemes. If so they are probably participating in a National Insurance avoidance scheme.
When you exchange salary for your personal pension contribution to be paid by the company the only benefit is a reduction in your recorded pay for calculating National Insurance contributions. The scheme exists for no other purpose.
You don't even need an account in Panama or have your own company and no one complains about it, it's perfectly legal. If the avoidance is outlawed i can hear the screams of outrage from those affected already.
Comments
Stunned that after the expenses scandal MP's, and especially party leaders and PM's, aren't a great deal more careful when it comes to money.
Doesn't reflect well on either Dave or Jerrmy (for different reasons).
There are maybe more expenses that can be taken as well.
Much like Dave, many say a part-truth without the giving the whole picture. So thank you @Alwaysneil for balancing some of the above posts that try to paint a picture of no advantage. Especially as you are a professional. Wasn't there also some angle involving interest free loans from the company as well?
Not sure why the Beast has to apologise for Jezza's tax return, especially as it was a challange about Dave not answering a question from several years earlier about a similar subject.
There is some frustration by some posters - understandably - as no matter how hard they explained people were continuing to make the situation sound much different. There's political viewpoints getting mixed up in the debate about a practice which goes on all the time by people in all kinds of walks of life, this situation has been compounded by some utterly dreadful reporting.
Forgive me if I'm being defensive, but I get the impression that it was my post that you're implying made out that this method was disadvantageous as you paid both Corporation Tax and Dividends Tax, that's not really what I was trying to convey. I did state that paying yourself via dividends can result in a comparable post-tax amount, which as Alwaysneil has pointed out, is true. Getting paid via a loan is what Jimmy Carr was doing, IIRC he took a salary that matched the personal allowance (i.e £11k) and then had an offshore company give him a loan for several thousand pounds every month - as a loan wouldn't be taxed. I haven't seen any mention of that - as that is a much shadier situation.
Needless to say, when he jumped in to the debate on Twitter he was being disingenuous (or even simply deceptive.) to try and compare his scheme with the mechanism in which thousands of contractors, small business owners and shareholders legally pay themselves each month.
Personally I don't really see a problem with it.
That was the first post I have seen mention of national insurance. Any post that has failed to do so, while defending the structure, hasn't given the whole picture. Alwaysneil said it would be comparable to income tax on a wage. Did he mean income tax and NI contributions? I have no option of deferring payment of NI on my earnings. I struggle to understand how anyone but the low paid can be able to have this option, especially when we have a health service at breaking point.
I completely agree with you though, that there's been some good discussion on here but it's quite sad that there hasn't been a very simplistic overview given in the press - or at least that I've seen. That may help people make more informed decisions about what's happened, instead we have papers fighting to name people over their sex lives.
As far as I understand it's comparable to income tax, and not combined NI contributions and income tax. So the only NI contributions would've been via his salary as Prime Minister (£140k salary = £6k NI) and his parliamentary salary when he was an MP (£75k salary = £4.8k NI).
I'm very naive as to NI, but I believe it's perfectly plausible to voluntarily make contributions - however the gov.uk guidance on this is far too much for my brain at gone midnight.
It must cost more money to check an over-complicated system and it must leave more loopholes. Why is there such resistance to a more simplified code?
I recently got fined for not paying tax on an in work benefit despite HRMC being in possession of overpaid tax at the same time. So maybe I'm just sore about the issue!
Personally I'm surprised more has not be made about Dave clearly dodging inheritance tax. But on the whole not many people seem to enjoy the idea of inheritance tax! Having been through the experience of probate, I think 350 of tax free money is a generous start. Even more so as it was not really mine, it was someone else's life and achievement/earnings.
I would be amazed if any journalist would think it worth investigating and even more if any media company owner didn't do precisely the same thing.
When I was at school doing economics, a teacher suggested the whole benefits system (and all its staff) should be abolished and for those deserving of extra Government funding, reverse income tax could be applied instead.
Now I'm sure such as system would create winners and losers.
Initially, UKIP had as its stated policy the abolition of NICs (presumably only employees contributions) with a corresponding increase in income tax rates.
A simple idea. And one I think that Osborne has also looked at. The problem was that pensioners don't pay NICs and would not have voted to pay away another 10% or whatever of their pension in tax. So to compensate, you'd have to give pensioners larger personal allowances. And so the complexity goes on. It got kicked into the long grass.
As a side issue, while Corbyn relishes pontificating on how everyone else should manage their lives, he, a wealthy man by most people's standards, fails to make any gift-aided charitable donations at all. What does that tell you about him?
I give loads to charity over the course of a year, but I'm fucked if I can remember all the payments when it comes to tax return time, so I don't bother with it.
I also studied economics, my teacher said something similar, he offered policies like the one you suggested in a previous post. One that targeted savings amongst low earners.
Not sure if bucket mostly works you should ignore the holes because it is a pain to get s new one.
In 2014 pensioners amounted to roughly 40% of all welfare spending. Pensions are 12% of the entire system. Yet this has been an area of the budget ring fenced because you have a government too scared of it's voter base to do something good yet painful for the country. I think that of every government since Thatcher I should add.
I was recently speaking to two pensioners, who both earn annually more than the average wage. They were horrified when I suggested taking away their TV license and bus pass. Both of which they hardly used. I think the time of universal benefit is dead. Even more so when you have a system that allows people, who can afford to pay tax, to not.
This report from a year ago citing earlier tax years: The average household income for pensioners rose by £500 to £21,800, with over 30% of that handed to the taxman in direct and indirect taxes.
In total, pensioners paid £47.26 billion in taxes during 2012-13. On average pensioner households paid £3,900 in indirect taxes and £2,600 in direct taxes in the 2012-13 tax year.
So, what might be paid out in benefits gets straight back to HMT anyway In the main, what it's probably not doing is going on a new tattoo, to Bet365 in Gibraltar*, or on a dozen bottles of Frosty Jack's.
Pensioners vote, and as you say, they resent any suggestion that the little perks they get should be removed. So, no political party is going to risk getting slaughtered at a General Election by upsetting them.
BTW, in case you are interested Cameron wrote a book, and the royalty receipts were donated to charity.
*Going off piste here but Peter Coates, a director of Bet365 has donated hundreds of thousands of pounds to the party. One particularly large donation coincided with the relaxation of gambling legislation and the lifting of a ban on television advertising by the Labour government. So the next time you wince as Ray Winstone mangles the English language in one of their ads, you know who to blame.
Dear low achievers (poor people), thank you for electing us, the super rich.
You emphasised my point,we will never have a political Leader while they follow opinion polls. Also that they resent any suggestion of the removal of 'perks'. Surely if the logic is sound, it should be entertained? Equally, I thought benefits were for the needy not considered 'perks' of old age.
There is no comparison with your figures so them mean little (no offence meant). I could not see the proportion of pensioners that pay income tax. Your figures have to be relative to non pension households. I pay 30% on income and NI let alone indirect taxes. Everyone pays indirect tax so that would be an interesting comparison. I imagine it would be a higher proportion of the non-pension household. The spread of proportion of indirect tax to the household based on dirstribution of wealth would also be interesting.
Did Cameron include the donation on his tax return? Treating a charitable donation as a tax deductible might come across as a little self-serving!
And, a bit like the 80 year old and the 16 year old, as long as the parties are fully aware of what they are doing, and happy, what's the problem??? Lots of things don't feel right to me, but I do not feel that it's my place to say that they should be made illegal - though I could be convinced in certain cases.
However, a few years ago, I watched someone from Help the Aged (now rebranded Age UK, I believe) being interviewed on TV about the winter fuel allowance. His argument on not means-testing it was two-fold. First, it would cost more to organise and administer the means testing than it would actually save. Second, there would inevitably be deserving cases that slipped through the net because it would be more difficult for them to apply for the benefit and they might not bother.
As for your question. Difficult to say. Neither Cameron or Osborne provided pdfs of their actual return. Instead they posted up letters from their accountants setting down the main points. The royalties on the book are shown as income. There is then a note explaining that it was paid away as a charitable donation. You're right about the self-serving thing. I suppose a cute politician with a favourite charity might say they increased the amount donated by an amount equivalent to the tax rebate! (BTW, I was amused to see that Osborne carefully included the £3 interest paid by his bank on his return, so he could pay the extra tax on it!)
I wasn't suggesting things to be made illegal, just that you can have situations where by it is both legal and many would consider immoral. As you say, it is subjective. Dave has preached to us though about our responsibility while seeming to have the means to pay for it and hasn't.
http://www.telegraph.co.uk/news/2016/05/10/panama-papers-emma-watson-named-in-latest-data-release/
When you exchange salary for your personal pension contribution to be paid by the company the only benefit is a reduction in your recorded pay for calculating National Insurance contributions. The scheme exists for no other purpose.
You don't even need an account in Panama or have your own company and no one complains about it, it's perfectly legal. If the avoidance is outlawed i can hear the screams of outrage from those affected already.