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Author Topic: This thing about WGs not paying tax  (Read 8325 times)

Offline aardvark

I think on saafe it says condoms indeed are tax deductable, as are boob jobs, cars for out calls, working premises, lap tops, phones, clothes etc.  It's not the tax man's job to tell you you're running your business badly by spending all the profits and over investing.  The net is taxable not the gross, anyone self employed can do the same thing.  I thought the standard advice to not put prossie on your passport is to be a self employed massage therapist.  Who's to say what went on behind closed doors then? 

The EE girls are probably shipping it home via western union or in hand luggage under the trigger limits.  Otherwise cash can just be offset against living expenses.  If they've got kids then that can burn up a lot.  Like any cash in hand business not everything is run through the books.

The next time I see a WG who claims to declare it all and be totally legit I'm going to ask her for a VAT receipt to see what she says.

I wonder whether boob jobs really are tax deductible?  Surely the taxman would argue that it isn't a necessay business expense - she could be a pro$$ie without a boobjob.  Similarly with clothing e.g. lingerie etc.  There was a case where the taxman refused a female barrister's claim for tax relief on court suits - apparently as they could be used for purposes other than court. She lost on appeal. Just think, we could end up in a situation where every Saturday night boobjobbed tart will be telling the taxman she is pro$$ie!! Presumably a Courtesan would get her Laboutins through just by fluttering her eyelids and breathing 'dahling, we are a Courtesan'.

Offline k

Its actually not that difficult as they will be registered with the HMRC as self employed. I myself and from and live on the Isle of Man, i work in tax consultancy and planning. As they will be registered as self employed they can claim to the HMRc a figure of just under 11,000 pounds for a fiscal year, meaning that they claim national minimum wage tax bracket and are charged by the HMRC as such. The rest of their money can then be applied to a trust account and paid back to them in the form of a loan award that never needs to be paid back, the HMRC have declared all forms of loan as tax exempt due to the fact that interest is applied to any form of "loan" and you cannot pay both interest AND tax on any sum on money. Set ups like this are only available to self employed people as if your employer pays you in the form of a loan thats automatic tax evasion.

Thats a very crude description to be honest it would take days to type out all the ins and outs  but any accountant worth his salt (and who helps prossies) would be able to advise on and set up a system like this.

Its all about using the law against the government lol
I think you are going to be going head-to-head with the government over "tax avoidance" systems more and more since these problems with people like Jimmy Carr.  I believe in playing fair myself - if I earn £100k per year then I expect to pay the tax relevant to that amount.  I don't want HMRC come knocking on my door when I'm in my retirement home telling me effectively that I've got to sell it because of a loophole I've exploited being closed off.

Its actually not that difficult as they will be registered with the HMRC as self employed. I myself and from and live on the Isle of Man, i work in tax consultancy and planning. As they will be registered as self employed they can claim to the HMRc a figure of just under 11,000 pounds for a fiscal year, meaning that they claim national minimum wage tax bracket and are charged by the HMRC as such. The rest of their money can then be applied to a trust account and paid back to them in the form of a loan award that never needs to be paid back, the HMRC have declared all forms of loan as tax exempt due to the fact that interest is applied to any form of "loan" and you cannot pay both interest AND tax on any sum on money. Set ups like this are only available to self employed people as if your employer pays you in the form of a loan thats automatic tax evasion.

Thats a very crude description to be honest it would take days to type out all the ins and outs  but any accountant worth his salt (and who helps prossies) would be able to advise on and set up a system like this.

Its all about using the law against the government lol

Hold on, so let's say a WG is on £50,000 a year and declares £11,000. They I believe would therefore pay about a grand in tax. But you're saying the other £40,000 they can just somehow place in a Trust and loan back to themselves? Do the government not take any interest in where £40,000 has magically come from and why a source has decided to just lend it to to this particular woman? I have to bow to your greater understanding if you do work in the business but surely if it were that easy, everybody would be doing it?

Hold on, so let's say a WG is on £50,000 a year and declares £11,000. They I believe would therefore pay about a grand in tax. But you're saying the other £40,000 they can just somehow place in a Trust and loan back to themselves? Do the government not take any interest in where £40,000 has magically come from and why a source has decided to just lend it to to this particular woman? I have to bow to your greater understanding if you do work in the business but surely if it were that easy, everybody would be doing it?

If the WG has her own limited company (which is how I operate as someone self-employed) you can't take out a loan without tax complications. What I do is pay mysalf a salary of roughly £10,000, which is the income tax threshold. This gets a bit of NI I need to pay but is close to tax free. Then I pay myself up to around £30,000 in dividends (depending how good the year has been). This is taxed as corporation tax at 20%. I also take out some expenses and my company makes pension contributions for me (these are tax free). Typically my personal tax rate is effectively a bit under 15%. If I have a good year then my income may have been higher than that but I tend to leave that in the company as a retained profit to take out as a dividend later when either I need the money or I haven't earned as much that year.

If I wanted to pay myself more, then any income above the upper tax threshold gets taxed at an additional 25% on top of the corporation tax my company has already paid. Paying myself as a loan is possible but there are rules about what can/can't be done and how/if it's taxed. I've avoided that as HMRC seems to be going after scheme's that try to exploit these rules.

Offline JV547845

I wonder whether boob jobs really are tax deductible? 

Yeah you're right, unless the WG can confidently argue there is no mixed personal benefit to the business one she should be very careful. http://www.taxrelief4escorts.co.uk/tax-basics/income-expenses/

Offline carra100

Hold on, so let's say a WG is on £50,000 a year and declares £11,000. They I believe would therefore pay about a grand in tax. But you're saying the other £40,000 they can just somehow place in a Trust and loan back to themselves? Do the government not take any interest in where £40,000 has magically come from and why a source has decided to just lend it to to this particular woman? I have to bow to your greater understanding if you do work in the business but surely if it were that easy, everybody would be doing it?

Well not everybody is able to genuinely work outside IR35 laws which establishes who actually can and cannot be classed as being self employed. Those who force themselves outside IR35 in order to take advantage of tax planning schemes will certainly have the spotlight shined on them. Lets not be naive about tax here, it has always been a game of cat and mouse with them HMRC and they state themselves that tax avoidance is NOT against the law. In fact they have a register called DOTAS where people who actively take advantage of current law and legislation can register themselves. You cannot retrospectively be asked to pay tax back if you have followed the law to the letter. However if you bend the truth in terms of your activities, your books and your business dealings in order to shoe horn yourself to fit into their criteria then you certainly could find yourself been chased by them. However as long as you act within their own legislation they cannot convict you, when they find the loopholes they then close them, the game changes and we look for another way to maximise take home. But you cannot retrospectively be committed of a crime. Just like if a road that had a 60 mile per hour limit which was then changed to 40mph the police couldn't convict people for speeding previous to the date of legislation change. Its all Tom and Jerry.

jcdmj12

Well not everybody is able to genuinely work outside IR35 laws which establishes who actually can and cannot be classed as being self employed. Those who force themselves outside IR35 in order to take advantage of tax planning schemes will certainly have the spotlight shined on them. Lets not be naive about tax here, it has always been a game of cat and mouse with them HMRC and they state themselves that tax avoidance is NOT against the law. In fact they have a register called DOTAS where people who actively take advantage of current law and legislation can register themselves. You cannot retrospectively be asked to pay tax back if you have followed the law to the letter. However if you bend the truth in terms of your activities, your books and your business dealings in order to shoe horn yourself to fit into their criteria then you certainly could find yourself been chased by them. However as long as you act within their own legislation they cannot convict you, when they find the loopholes they then close them, the game changes and we look for another way to maximise take home. But you cannot retrospectively be committed of a crime. Just like if a road that had a 60 mile per hour limit which was then changed to 40mph the police couldn't convict people for speeding previous to the date of legislation change. Its all Tom and Jerry.


IR35 doesn't regulate who can and can't be self-employed. It's Intermediaries Legislation, and only affects usage of a Limited company or other intermediary to (in HMRC's eyes) avoid employment status and the additional tax that involves.    Unless a WG was billing through a limited company, she would never have to worry about it. There are separate tests for the self employed (available on HRMC website), but it's pretty certain a WG would pass them unless she was being paid hourly by the same person for several days a month.

Your information about DOTAS (disclosure of tax avoidance schemes) is also misleading.  Since the DOTAS legislation was introduced, it is mandatory to register any tax avoidance scheme you are involved in which fall under the DOTAS regime.  HMRC can then examine the scheme at a later date and decide whether or not it 'works' or not.  If they decide it doesn't, they can pursue you for tax due, interest and penalties, and then it's down to you to fight it via tribunal. 
« Last Edit: August 03, 2014, 08:09:33 PM by jcdmj12 »

Offline Jimmyredcab

If they are not declaring it then they have to spend it. 

Even if they stick it under their mattress for ten years they will come a cropper because all of the banknotes will have been redesigned.  Ok the notes they have can be swapped at the bank for current designs, but HMRC will be informed if a "trigger-point" is activated e.g., the total cash being submitted.

With respect you are talking cobblers.    :crazy:

Before a bank note gets withdrawn you are given lots of notice, at least a year, that is ample time to change up the old notes into the new design, needless to say you can't walk into your branch with ten grand in old notes. 

Offline Jimmyredcab

I believe in playing fair myself - if I earn £100k per year then I expect to pay the tax relevant to that amount. 

I salute you Sir, you are one in a million.     :rolleyes:

Offline k

With respect you are talking cobblers.    :crazy:

Before a bank note gets withdrawn you are given lots of notice, at least a year, that is ample time to change up the old notes into the new design, needless to say you can't walk into your branch with ten grand in old notes.
Being provocative again are we Jimmy?

How many times have I heard you say that WG's are not the most intelligent people of the human race. 

jcdmj12

Smart British girls will be doing what most cash-based businesses do: register with HMRC, declaring enough tax to explain their provable purchases (house, car, holidays where your passport gets stamped) and general lifestyle,  then using undeclared income for spending on fripperies.  The general rule is "don't take the piss".   Hector's not going to open up a full tax investigation for 5 grand spent on shoes, clothes and fancy meals, as it will cost more than that to find it.  Buying a house or car with undeclared income is painting a big red target on your back though.

I'd imagine most of the EEs are shuttling it out of the country in their luggage.
« Last Edit: August 03, 2014, 08:20:14 PM by jcdmj12 »

Thanks for all your input guys, very interesting. Two things of particular note:

1) Interesting the number of 'tax experts' who end up giving directly contradictory advice on something that can only have one correct answer.

2) Interesting how sometimes in threads, the idea that WGs DON'T earn a fortune is considered absurd, whereas in this thread the idea that they DO is being frowned upon. Reminds me of the two recent threads about discounts, one (that I started) was almost universally along the lines of 'regulars should get a discount', the other was almost universally 'regulars should never ask for a discount'.

 I guess maybe there are no hard and fast rules :drinks: :drinks:

Offline Jimmyredcab

Being provocative again are we Jimmy?


Not at all, I simply tell it as it is, that is the reason I have amassed so many enemies over the last 12 years, I wouldn't have it any other way.    :hi:

Offline k

I salute you Sir, you are one in a million.     :rolleyes:
Yes, you can be sceptical if you want to.  I've seen at first-hand people cooking the books and seen what happens to them when they get caught.  It isn't worth it.

Offline Jimmyredcab

Thanks for all your input guys, very interesting. Two things of particular note:

1) Interesting the number of 'tax experts' who end up giving directly contradictory advice on something that can only have one correct answer.


I am not a tax expert which is why I drive a cab for a living.    :hi:

What I do know 500% for sure is that anyone earning £1500 + a week in untraceable cash would be very stupid to declare it to HMRC.

Maybe you could educate us with your "correct answer".     :unknown:

jcdmj12

Thanks for all your input guys, very interesting. Two things of particular note:

1) Interesting the number of 'tax experts' who end up giving directly contradictory advice on something that can only have one correct answer.


I'm certainly not a tax expert, but this is bollocks.  Tax law is like all law, open to interpretation and hence conflicting views. That's why they have these handy things called 'courts', 'lawyers' and 'judges'. 


Fair enough, didn't mean to offend anybody. I certainly don't have the right answers myself!

Offline smiths

Thanks for all your input guys, very interesting. Two things of particular note:

1) Interesting the number of 'tax experts' who end up giving directly contradictory advice on something that can only have one correct answer.

2) Interesting how sometimes in threads, the idea that WGs DON'T earn a fortune is considered absurd, whereas in this thread the idea that they DO is being frowned upon. Reminds me of the two recent threads about discounts, one (that I started) was almost universally along the lines of 'regulars should get a discount', the other was almost universally 'regulars should never ask for a discount'.

 I guess maybe there are no hard and fast rules :drinks: :drinks:

It shows people have different opinions on things, hardly something new. As to tax, no offence to anyone but i personally would be getting qualified tax advice rather than just taking the word of someone on here who might or might not be correct.

Offline wristjob

Smart British girls will be doing what most cash-based businesses do: register with HMRC, declaring enough tax to explain their provable purchases (house, car, holidays where your passport gets stamped) and general lifestyle,  then using undeclared income for spending on fripperies.  The general rule is "don't take the piss".   Hector's not going to open up a full tax investigation for 5 grand spent on shoes, clothes and fancy meals, as it will cost more than that to find it.  Buying a house or car with undeclared income is painting a big red target on your back though.

I'd imagine most of the EEs are shuttling it out of the country in their luggage.

Exactly how I see it.

jcdmj12

It shows people have different opinions on things, hardly something new. As to tax, no offence to anyone but i personally would be getting qualified tax advice rather than just taking the word of someone on here who might or might not be correct.

+1  "But it said so on the Internet" won't cut much ice when the inspectors come a knockin'


Offline k

I am not a tax expert which is why I drive a cab for a living.    :hi:

What I do know 500% for sure is that anyone earning £1500 + a week in untraceable cash would be very stupid to declare it to HMRC.

Maybe you could educate us with your "correct answer".     :unknown:
Now who's talking BOLLOCKS!!!

Unless you meant very stupid NOT to declare it to HMRC.

But you are being provocative again, and I've bitten the bait. 

Offline Jimmyredcab

Yes, you can be sceptical if you want to.  I've seen at first-hand people cooking the books and seen what happens to them when they get caught.  It isn't worth it.

Ever seen that programme called "benefits street"  ------ those people rely on good citizens like you paying their fair share of tax.    :hi:

Offline k

I'm certainly not a tax expert, but this is bollocks.  Tax law is like all law, open to interpretation and hence conflicting views. That's why they have these handy things called 'courts', 'lawyers' and 'judges'.
Yes, but who they find in favour of is a game they play between themselves.  The best way to keep hold of your destiny is to stay out of courtrooms (unless as a juror).

Offline Jimmyredcab

Now who's talking BOLLOCKS!!!

Unless you meant very stupid NOT to declare it to HMRC.

But you are being provocative again, and I've bitten the bait.

If you honestly believe that prostitutes declare every penny that they earn then you are living in a Harry Potter fantasy world, please tell me you are winding me up.    :dash:

Offline k

Ever seen that programme called "benefits street"  ------ those people rely on good citizens like you paying their fair share of tax.    :hi:
This isn't Waddingtons Monopoly though.  As I said, I've seen people who earned big big bucks being reduced to tears by the taxman.  If it's a game then the Hare & Tortoise race, or Snakes and Ladders would be more appropriate.


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