Dhoon Boy Posted February 18, 2009 Share Posted February 18, 2009 Bailed-out bank fights Treasury on metal traders' bonuses State-controlled Royal Bank of Scotland is fighting the Treasury in court over a bonus scheme, the Guardian can disclose. A group of City metal traders, now owned by RBS, are trying to avoid paying income tax and national insurance contributions on six-figure bonuses, often worth several times their salaries. Bonuses were paid into an offshore trust. Cash was then provided to their spouses as "loans". Amounting to almost £1m in some cases, the cash was often used to pay off mortgages or to buy two or three houses at a time. The traders, from RBS Sempra Metals, have a history of seeking to escape tax or national insurance on their bonuses, a tax tribunal found last year. In the 1990s, traders took payment in jars of platinum sponge, a valuable greyish-black metal preparation used as an engineering catalyst, or in gold bullion. When those devices were blocked by the Revenue, Sempra's finance director, David Tregar, bought a new scheme from an accountant in the Isle of Man tax haven. The accountant, Edward Gittins, ran an offshore "employee benefit trust", which made loans to directors and executives, led by chairman Michael Hutchinson and chief executive Peter Sellars. The tribunal found that "in general, loans were not repaid". After that scheme in turn was blocked, the trust was re-christened a "family benefit trust", and made loans to the wives and relations of employees. In 2007-08, the last year of published accounts, Sempra Metals paid some $21m (£14.7m) into the family benefit trust. The tribunal said cash distributed among 30 senior employees frequently served to double a trader's salary "but in a good year could amount to a significant multiple of his annual salary". RBS bought control of Sempra Metals in April 2008, one of the final acquisitions before the credit crunch, a government bail-out and 68% Treasury control. An RBS spokesman said bonus payments into the Isle of Man were stopped when it took over Sempra, but a high court appeal against the tribunal ruling continued. It is due to be heard next month. The tribunal ruled that Sempra must pay 30% corporation tax on its bonus fund, but individual employees were not liable for contributions on their "pot". Both sides are seeking to clarify the law in the appeal. Asked why a state-funded bank was appealing against its own funders, RBS said: "The family benefit trust is presently the subject of litigation between RBS Sempra Metals and HMRC [the Revenue] and in these circumstances it is not appropriate for us to provide further comment pending the outcome of the litigation." The Treasury minister Stephen Timms, writing in the Guardian, today promises: "We will remain relentless in taking action - domestically and internationally - to tackle both tax avoidance and evasion." Link to comment Share on other sites More sharing options...
keyboarder Posted February 18, 2009 Share Posted February 18, 2009 Damaging maybe, but justifiably so. Link to comment Share on other sites More sharing options...
thebees Posted February 18, 2009 Share Posted February 18, 2009 What is the difference between them and people who own companies in BVI (or where ever) and get their 'consultancy fees' paid to that company thus avoiding tax on their earnings? or people who use 'offshore' companies as contractees to avoid paying the local tax in the place where they work? It is all filthy dirty cheating, but perfectly legal, such is the world of high finance. Link to comment Share on other sites More sharing options...
%age Posted February 18, 2009 Share Posted February 18, 2009 The Isle of Man is emerging in quite a few places. Here's recent from the Telegraph (Where is that photo taken?) Do you think they've sussed us out yet? Link to comment Share on other sites More sharing options...
Dhoon Boy Posted February 18, 2009 Author Share Posted February 18, 2009 What is the difference between them and people who own companies in BVI (or where ever) and get their 'consultancy fees' paid to that company thus avoiding tax on their earnings? or people who use 'offshore' companies as contractees to avoid paying the local tax in the place where they work? It is all filthy dirty cheating, but perfectly legal, such is the world of high finance. There's no difference, just with the current feelings toward the bailed out UK banks, this associates the Island with greedy bankers stripping out profits to be then replaced by UK taxpayers cash, and does us no good while the current review is taking place. Link to comment Share on other sites More sharing options...
%age Posted February 18, 2009 Share Posted February 18, 2009 And from the Guardian 9th Feb 09 bout Dixons doing a bit of juggling with companies and taxes. I wondered at this quote though: Despite Britain's generosity, those who run the Isle of Man continue to market their island as a tax haven Link to comment Share on other sites More sharing options...
thebees Posted February 18, 2009 Share Posted February 18, 2009 So how come it is only now that the ordinary person is taking an interest in this? Could it be because people only know what they read in the papers and do not think for themselves until it may effect them? If the government are saying 'The IoM is well regulated blah blah blah' then people are quite happy with the skullduggery, it is only when the newspapers start making noises about such things that somethings (only some, not all) are questioned, there are ways around most taxation laws and the money grabbers know it. One of my favourite accountants is also a complete bastard, lovely man but he knows the limits and knows how to work them to 'client x's benefit (all legal but similar in practice to the Enron shindig) ....'one of my favourite accountants' - that has to be the saddest thing I have ever read, I have favourite accountants Link to comment Share on other sites More sharing options...
When Skies Are Grey Posted February 18, 2009 Share Posted February 18, 2009 I love it....this socialist sabre rattling that everyone is banging on about. My conscience shall remain clear for so long as the UK non-dom rules continue to hide the UK's tax haven status in plain sight! Link to comment Share on other sites More sharing options...
enbee Posted February 18, 2009 Share Posted February 18, 2009 Reminds me of the saying about pots calling kettles black. See Guardian Tax Hypocrisy Link to comment Share on other sites More sharing options...
b4mbi Posted February 18, 2009 Share Posted February 18, 2009 The Isle of Man is emerging in quite a few places. Here's recent from the Telegraph (Where is that photo taken?) Do you think they've sussed us out yet? very good question! where is that photo taken??? I don't recognise it at all.... Link to comment Share on other sites More sharing options...
pongo Posted February 18, 2009 Share Posted February 18, 2009 where is that photo taken??? I don't recognise it at all.... Apparently the Press Association photo which accompanies the item was taken at Cullercoates (in the North East of England). ETA: The Telegraph story which %age and b4mbi were asking about, I mean. Link to comment Share on other sites More sharing options...
%age Posted February 18, 2009 Share Posted February 18, 2009 Safe haven: amid stormy financial times the Isle of Man retains its AAA rating from global credit rating agencies and has low taxes Photo: PA Ahh! I get it. It's to do with the word 'stormy' and buggar all to do wi' Isle of Man as such. It is the sort of picture that longtaletv might use as a back drop to their news stories! Link to comment Share on other sites More sharing options...
Sebrof Posted February 18, 2009 Share Posted February 18, 2009 Safe haven: amid stormy financial times the Isle of Man retains its AAA rating from global credit rating agencies and has low taxes Photo: PA [/size] Ahh! I get it. It's to do with the word 'stormy' and buggar all to do wi' Isle of Man as such. It is the sort of picture that longtaletv might use as a back drop to their news stories! A55 West of Conwy? S Link to comment Share on other sites More sharing options...
pongo Posted February 18, 2009 Share Posted February 18, 2009 Safe haven: amid stormy financial times the Isle of Man retains its AAA rating from global credit rating agencies and has low taxes Photo: PA [/size] Ahh! I get it. It's to do with the word 'stormy' and buggar all to do wi' Isle of Man as such. It is the sort of picture that longtaletv might use as a back drop to their news stories! A55 West of Conwy? S What? You don't believe me? Apparently the Press Association photo which accompanies the item was taken at Cullercoates (in the North East of England). it's in the description field of the image data: Storm hits UK...A man watches as waves hit the coastline at Cullercoates in the North East, as high winds batter the UK. PRESS ASSOCIATION Photo. Picture date: Monday March 10, 2008. Winds of more than 80mph ripped through Britain today as police warned travellers to use Link to comment Share on other sites More sharing options...
Sebrof Posted February 18, 2009 Share Posted February 18, 2009 Safe haven: amid stormy financial times the Isle of Man retains its AAA rating from global credit rating agencies and has low taxes Photo: PA [/size] Ahh! I get it. It's to do with the word 'stormy' and buggar all to do wi' Isle of Man as such. It is the sort of picture that longtaletv might use as a back drop to their news stories! A55 West of Conwy? S What? You don't believe me? Apparently the Press Association photo which accompanies the item was taken at Cullercoates (in the North East of England). it's in the description field of the image data: Storm hits UK...A man watches as waves hit the coastline at Cullercoates in the North East, as high winds batter the UK. PRESS ASSOCIATION Photo. Picture date: Monday March 10, 2008. Winds of more than 80mph ripped through Britain today as police warned travellers to use I do beg your pardon; I seem to have missed your post. No slight intended. S Link to comment Share on other sites More sharing options...
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