If only Mrs. Phillip Green's wife would pay her taxes in the UK

[EggFriedRice]

I have read about Mrs.Phillip Green's wife who lives in Monaco, she is also the owner of Topshop in the UK and has been paid the biggest ever dividend in UK history, over £1 billion pounds, now what I fail to understand is why does she not live in the UK where her businesse's are located? why does she choose to live as a tax exile? Does this not lead many people to believe that she is deliberately trying to avoid paying UK tax? Yes of course we are not stupid, I have destroyed my Topshop card & will never buy another item from Topshop again, I think that Mr. & Mrs. Green are hypocrites, end of

monkeyjamtart, you hit the nail on the head.

There is a big difference between what is legal, and what is morally right and socially acceptable.

Paying your staff £7.00 an hour, while you earn £500,000 p/a is legal, but IMO it is not morally right. Given the social evils caused by extreme inequality, I do not believe it should be socially acceptable either.

Its a bit like a woman standing outside an infant school, chain smoking, and then grabbing her toddler when he comes out, calling him stupid and saying he's a waste of space. It isn't illegal, but it is certainly both immoral and socially unacceptable.

We need to start criticising rich people who behave in immoral and unacceptable ways, as well as poor ones.

mayorquimby - Oh, I didn't get that! Sorry!

Aww bless you NancyDrew. Do you believe in the tooth fairy too?

Takver- Why is paying your staff the market rate whilst making a large profit immoral?
It just good business

It is a way to make your staff feel disenfranchised and lose the best of them.

Profits in John Lewis Partnership rose 28% over the last year, vs 1.6% in the Arcadia Group. I think the fact that JLP is owned by its employees is a bloody brilliant business model and is clearly a lot more profitable in a recession.

A totally hierarchical capitalist model hasn't worked that well since the mid 20th Century uyter - there are enough collapsed businesses around to prove that

Ladybiscuit which bit do you mean - it is fairly well documented

If she didn't in fact live in Monaco then given their high profile she would be charged with tax evasion offences.

She is worth billions, isn't from the UK, doesn't work in the UK - why the hell should/would she live here?

The dividend money paid to Mrs.Green is money earned in the UK and therefore should subject to tax, but it is being taken out of this country untaxed. Give me one good reason why she should be allowed to to do this other than be legally allowed to do so. We're talking billions

I meant the bit when you believed the family moved to Monaco because it was less stressful and stayed because the children were settled. Yeah, like flying back and forth is easy. It was a tax move, nothing else and coincided with a massive upturn in their personal fortune.

He puts everything in her name so he doesn't have to pay tax Nancy. I don't know why you think that's an okay thing to do. It's despicable.

uyter - firstly, I would argue that 'paying market rate' is not good business. I believe that paying all workers a good wage, without massive inequities between them, is the way to get good results and a company where everyone works together. I don't expect everyone to take it to the extremes that I/DH do (everyone in our business is paid the same hourly rate, ourselves included, and all profits are shared at the year end - FWIW we were one of the fastest growing businesses in Wales last year).

Secondly, I believe that more equal societies are happier and more successful societies. (Just to be clear, I don't mean more equal in the state socialist sense, but in the Scandinavian sense.)

Are dividends not paid out from the companies profits which will already have been taxed through corporation tax. To tax divedend payments would be double taxing and wouldn't do much to encourage investment either

Exactly LadyBiscuit.

The problem here is not that a foreign-located owner of a UK-located company does not pay UK income tax. That is pretty common and messing with that would destroy foreign investment in UK companies.

The problem is that the REAL owner of Topshop is Philip Green, who IS UK located. He OUGHT to have a massive income and pay UK income tax on that. However, he chooses to arrange things so that most of the massive income goes to his non-UK located wife, to avoid paying UK tax. He takes a small salary instead and pays UK tax on that. This is clearly a sham since it is obviously Mr Green and not Mrs Green who is doing most of the work and therefore should be paid most of the income.

cikals, if you receive dividend payments they are taxed as income, I'm pretty certain.

You used to get an offset (can't remember the proper word) which meant that you could 'knock off' the amount that had already been paid as Corporation Tax, but it was abolished back in the 90s (by the last Conservative government, interestingly).

So effectively they are taxed twice for anyone resident in the UK.

I may be wrong, but I think that is the situation, hopefully someone will come and put me right if not.

Yes dividends are taxed as income (though I have a feeling it's at less than 40% so better than receiving a salary if you are a higher rate tax payer).

Minimising your tax bill is both sound and a very sensible thing to do. I run only a small business and I use tax avoidance measures and any board of a large company that didn't use tax avoidance measures would be ousted by the shareholders pretty quickly.

Ah, looking at this it looks as though you do still get a credit against Corporation tax paid, but only at 10% (compared to a Corporation tax rate of 21% / 28% - link here).

But tax rates on dividends are lower than tax on income - 10% up to the lower rate limit of c£32K, then 32.5% on dividend income up to £150k, then from this year 42.5% above £150K

I'm not sure why dividend income is taxed at a lower rate than wages.

Dividend income is taxed at a rate lower than income to encourage investment

dertitude - he doesn't have any shareholders as such - the family are shareholders. He minimises tax even further by 'loaning' extortionate amounts to the family which is then offset against corporation tax. Our tax laws were not designed for individuals to own this much

ladybiscuit well we will have to agree to disagree re the dispicable comment. I just cannot get outraged about a married couple holding assets in the name of the spouse whom can maximise a reduction in their tax liability. It is fairly standard practise and I would be suprised if anyone here who is a HR tax payer would not put their savings in the name of a lower rate tax paying partner.

Re their moving to Monaco, frankly I couldn't care less if it was entirely for tax purposes, however it is fairly well documented that he stopped working for health reasons and the move coincided with that.

minipie he has reportedly paid £400 million in personal income tax in the past 5 years - if that counts as a small salary in your world then I am envious.

Dividend payments paid in the UK are subject to PAYE, which for higher rate taxpayers will soon be 50%, however, they are not subject ot National Insurance.
dertitude, my DH runs his own business but does not use any tax avoidance measures, can you give me your suggestions other than move to Monaco?

Even if he has no shareholder it would still be remiss of him not to reduce the tax bill to the lowest amount possible. For example my 16 year old brother is paid a salary from my business but I wouldn't let him near it with a bargepole but he reduces my tax bill. Its just good business practice and maximises profits

well, this thread is changing my opinion of a lot of posters and no mistake.

not least that I now have great respect for Takver.

dertitude, according to the taxman this is illegal practice, unless your brother is carrying out some tasks proportionate to the wage he is receiving this is not something my DH would encourage within his business, if the taxman found out, this would land him in trouble. How is it a loophole I wonder?

No, it's tax avoidance dertitude, not good business practice. I have the greatest respect for good business practice but I don't believe a good business needs to resort to sharp practice - hence my reference to John Lewis earlier.