Taxi Driver Online

Yes Andy, it was the category that caught me out, you'd think 'licensing' or something like that would be appropriate, but not 'commercial'!

Anyway, with my excellent summary, the actual case was not required!!

Dusty

So does the DPH lease the vehicles, then sub-lease them to drivers, or do the drivers sub-lease them or lease them directly from a third party.

What I can't understand is why the companies turnover is low enough not to have to file accounts.

If the drivers were paid a wage or commission, then the whole take would have to go through the books (I think) which would put them above the turnover limit (I think).

Dusty

Thats interesting about the ombudsman case.
Person buys plate, driver gets plate, council compensate person.
So the poll tax payer has had to pay for something that was given away for nothing.
Very strange.

Is not the threshold for filing with Companies House £300,000 turnover?

If so, you could easily get out of filing, by running

a Radio Circuit,

a car hire company,

and so on. Each a separate bird so-to-speak.

There is/was a company down here that had every car as a separate Limited Company, thus avoiding VAT too!

_________________
There is Significant Unmet Demand for my Opinion.

well let me tell you if you dont like it get a local citizen to oppose the accounts, and push for surcharge.

it would become a national scandal.

Wharfie

well Andy forming companies to avoid vat is unlawfull, if inland revenue or customs discover hed better like poridge.

Wharfie

Yes, I'd be surprised if he got away with that Andy, or no one would ever be registered for VAT.

He might have tried though!

Dusty

If it is £300k then they could quite easily arrange things as you say Andy.

I see that 203020 has set up a leasing company of some kind, according to the Companies House website.

Dusty

Tax avoidance is perfectly legal.

It is tax EVASION which is illegal.

Where the dividing line comes, I really don't know.

_________________
There is Significant Unmet Demand for my Opinion.

"They" did sort of get away with it. Provided it could be proven that the Companies were at "arms length from each other" (that's what was said), then no law had been broken.

They did eventually get put out, but for other reasons I understand.

Their primary problem, was that they were watched like hawks after they won (got away with) the first case, and jumped from a great height when eventually they did find something wrong. We all thought at the time, that it was a bit like waving a big red flag to a Bull, and so it proved. No one cried when they dissapeared.

_________________
There is Significant Unmet Demand for my Opinion.

I've always been of the opinion that what goes around, comes around.

Oh s***, that means I better what out.

tax avoidance is where monies are spent to avoid tax like insurance policies and capital expendature.

forming companies, or lying about turnover to avoid tax is evasion.

the lines are clear.

Wharfie

I'd have to disagree with you quite strongly on this one Wharfie. Forming Companies is all about avoidng taxation. That, along with the limits to personal liability they afford, is the most common reason they are formed.

Lying about turnover, yes, that is clearly illegal. But splitting things between companies to avoid certain thresholds is everyday stuff.

Forming companies based in the Bahamas, for example, with an office domiciled in Alderney (again for example), is common, and affords the owners tax bills of around £600 per year, irrespective of turnover.

There has been some cramping down on this since the 1985 Companies Act, but it is still widespread.

Avoidance is legal.

Evasion is illegal.

_________________
There is Significant Unmet Demand for my Opinion.

Well Andy
in that case we will have to disagree, I know very little about finance so have financial advisors and accountants, that is 2

the first Accountant is Peel and Walker
11, victoria Road
Elland West Yorkshire,

the seccond
Mr G Poppleton
Black Dyke Mills
Queensbury
Bradford

both advise me that it is unlawfull to set up companies with the intention of avoiding vat, beccause to be frank at the beggining of the year that is exactly what I proposed to do.

they did give me advice that divided my portfoli into four.

When I get financial advice it comes from no1 and is checked with number 2, only if bith aggree do I go ahead.

so I cannot say you are categoricaly wrong, but I have no confidence in using it.

all I can say that I am advised there is a clause in the company act about set ups like this avoiding or evading tax

Wharfie

I think there's a bit of truth in what both of you are saying.

If you arrange your affairs to reduce your tax but do it legally then that's avoidance. If you do it illegally then that's evasion.

It thus comes down to whether what you do is legal or not.

Simple, innit??

Dusty