Cyprus-Forum.com

[Lordo]

Listen Bordo, (not Bezos) I am all for companies paying their taxes and I am well aware that they will try to limit their tax liabilities whenever possible.

But you wont answer the question because you havent thought your turn over tax through properly.

Stop talking shit boy.

The only way you are going top stop these cunts from not paying their taxes is taxing turnover not profit as turnover they cannot hide or tansfer.

We have companies making billions in profit and diverting them tax heavens where there is either a low tax or no tax and you are talking about working out each sector and how much profit they make.

Get it in to your thivk head. They are not declaring their profits. Ise delay xerodjehaols gavole.

Get a fuckin life idiot.

In the meantime here is a little trick M&S plays for instance.

They move their production to countries like Malaysia or Egypt and cut their production costs because they do npt even pay the pwrkers there a living wage and employ children too in their sweatshops.
Interesting facts though, the poor sods had last year:
Group revenue = £9.0bn
Profit before Tax = £(201.2)m thats minus if you did not realise. Like fuck.

[Maximus]

and he avoids answering the question again.

[Paphitis]

You still don't get it boy. When a company declares low profit margin or no profit margin you believe them. And yet these organisations are multi national companies with thousands of outlets.

Starbucks' head of finance, Troy Alstead, was forced to portray his company as a perennial commercial flop, in order to account for its peculiar failure to record a taxable profit in the UK for 14 out of the last 15 years.

He was followed by Amazon's Andrew Cecil, who was reduced to stuttering when he was accused of being "pathetic" for his inability to disclose something as basic as how much of his firm's European sales came from the UK last year.

Last up was Google's Matt Brittin. In contrast to his two peers, Mr Brittin did not seek to evade or apologise.

Yes, of course Google minimises its tax bill, by operating in Bermuda and Ireland, he said. Google had a duty to its shareholders to minimise its costs. And besides, the UK still benefited from Google's many free products, not least its search engine, which were engineered by thousands of employees in California.

What have you done with the furquine toilet brush again, there are 20 more toilets to be cleaned yet.

Listed companies are audited by the stock exchange. It's very difficult to falsify declared profits beyond the scope of what is legal. If they get caught doing that, the shit really does hit the fan, and their stock share price tumbles because they lose credibility with investors.

But they DO minimize tax by doing legal things like:

stock adjustments and write offs of bad stock
and depreciation

Many more loop holes than that of course.

For example business trips. You can go on conventions or meet suppliers.

Registering personal vehicles under the entity

Claim a portion of your home electricity and computing infrastructure and IT - phone, internet, electricity, computers, the list goes on.

Many advantages like buying property under different entities and paying the company tax rate and distribute as a franked dividend when you are poor or have no income.

You may not like it, but there are dozens of ways to reduce tax. All legal and there is NOTHING you can do about it.

Company directors need a win somewhere. Yes, money is to be made. But let's say you are a small business. 10 or so employees. Your wages and salary bill alone is $700,000 per year. That's a very heavy burden. Then add leases, supply chain costs and all your fixed costs. Takes you up to $1.5 million. This is what you need to turnover before you make your 1st dollar of profit for the year.

Rule of thumb is this. A good business will trade on average 22 days a month. 19 days of trade cover all your fixed and non fixed costs. 2 to 3 days per month is pure profit margin. Profit declared under the Pty Ltd which the book keeper and accountant will try to dwindle away with legal claims through write offs, if they can.

Pty Ltd will pay company tax rate. Money then sits in the company's accounts where it stays until the directors decide to pay a dividend to shareholders and themselves at the time that suits their circumstances, again to reduce tax liability.

Thing you need to understand is that it is actually small and medium business that runs the country. Small and medium business employ the majority of the workforce, taking people off welfare. Without them, the country would be bankrupt.

And running a business is friggin stressful. A lot of ups and downs, and you got to watch your costs.

[Pyrpolizer]

In the meantime here is a little trick M&S plays for instance.

They move their production to countries like Malaysia or Egypt and cut their production costs because they do npt even pay the pwrkers there a living wage and employ children too in their sweatshops.
Interesting facts though, the poor sods had last year:
Group revenue = £9.0bn
Profit before Tax = £(201.2)m thats minus if you did not realise. Like fuck.

Well, if the group makes no profit, then it should worth nothing.
Settle that when the owner kicks the bucket. All heirs get nothing and the company gets dissolved.
Let's see for how long he will continue declaring losses.

[Maximus]

In the meantime here is a little trick M&S plays for instance.

They move their production to countries like Malaysia or Egypt and cut their production costs because they do npt even pay the pwrkers there a living wage and employ children too in their sweatshops.
Interesting facts though, the poor sods had last year:
Group revenue = £9.0bn
Profit before Tax = £(201.2)m thats minus if you did not realise. Like fuck.

Can you imagine if these companies pulled their production out of Turkey too.

I thought you were all about eliminating poverty not creating more of it.

Go scrub the bogs with a brillo pad will ya.

[Paphitis]

In the meantime here is a little trick M&S plays for instance.

They move their production to countries like Malaysia or Egypt and cut their production costs because they do npt even pay the pwrkers there a living wage and employ children too in their sweatshops.
Interesting facts though, the poor sods had last year:
Group revenue = £9.0bn
Profit before Tax = £(201.2)m thats minus if you did not realise. Like fuck.

Well, if the group makes no profit, then it should worth nothing.
Settle that when the owner kicks the bucket. All heirs get nothing and the company gets dissolved.
Let's see for how long he will continue declaring losses.

Not true.

You can show a loss because you bought plant and equipment or stock and spent more than money earned.

The stock/plant and equipment has a value.

In other words, the profit is sitting in plant and equipment and stock. This is just a tax delaying strategy because eventually, you will sell the stock and the profit will show the following year. On;y so far you can go. Eventually, you got to pay some tax.

Companies can do that deliberately to avoids tax but you can't do it every year.

The stock will appear on company financials and it's Addendums. For example, if the company bought a fleet of 10 cars, these cars will appear in the Profit and Loss Plant and Equipment Addendum and the Depreciation Schedules because this company will depreciate the value of these vehicles each year, to minimize tax, and claim all costs associated with these vehicles such as fuel and maintenance.

Here is an extreme example. An airline can declare a loss of 1 billion dollars. But when you drill down, the loss could be because this airline ordered 10 aircraft from Boeing.

[Paphitis]

The other thing people do not realize, is that Directors and Owners, pump in vast amounts of money into their business, especially on start up.

They can borrow against their home or other property. They can pump in their own cash.

These amounts are written up as loans to the company. Directors and owners are entitled to charge interest on those amounts. This interest is an expense to the company - which naturally raises costs and reduces profit. But the directors are pocketing the profit through interest which they would ideally do through a discretionary trust to minimize tax of course.

So what happens when you are in business is you end up with a web of companies and discretionary trusts.

For example, the company may lease an office, warehouse, or whatever. That property could be owned by the directors under a separate entity. Lease payments are still made. It';s just an easy way to move money around, create expenses, and liabilities.

And that my friends, is the best thing about capitalism. The system works.

[Paphitis]

Business evaluations are usually quite involved.

It's not just the company profit or loss. When you go to the Banks for a lown, there arte a ranmge of things a Bank will consider and yes, you can get the loan through even if the business is showing a loss.

That's because a loss, does not mean the business has lost money.

They could show a loss, because the bought lots of stock, or plant and equipment, or did a stock adjustment or write off.

The Banks know its a loss on paper but not a loss in practice.

Usually, there are many add backs to the bottom line such as:
increased stock value
increased plant and equipment
property purchase
Director Fees and Dividends
Director Salaries
Depreciation
Interest payments to Directors or loan
Maybe even one off expenses

Therefore there is an underlying profit which banks are trained to identify.

Same when selling or buying a business. These add backs need to be accounted for and verified.

Accountants and Financial analysts are trained to do this. A lay person isn't and just looks at the bottom line, sees a loss and things the business lost money which may not be the case at all.

A lay person is also liable to think that business is gaming the system. Not the case. I can tell you that in my case, I pay for a book keeper. It costs me $12000 per year. Accounting fees are circa about $20,000 per year. Then there are software license fees for everything on top. All these things to MINIMIZE TAX but to also do it legally, and not to do anything other than that because that would be breaking the law and the consequences of doing that and getting caught (and you will get caught) can be catastrophic to the business.

You also pay Management Insurance which is insurance for the Directors against negligence, law suits, audits which cover all these expenses including legal fees.

It's not uncommon that when you are in business, you have multiple entities and everything and all assets are split. That's called the family tree or Group. Companies at top of the tree, then its Trusts, then the Directors, then thewir beneficiaries.

It's literally a financially messy structure which requires a highly trained expert and eye to dissect - usually Accountants and Top Level Executive Bankers.

[miltiades]

Paphitis wrote:
They could show a loss, because the bought lots of stock, or plant and equipment, or did a stock adjustment or write off.

The Banks know its a loss on paper but not a loss in practice."

WRONG !!
Where on earth do you get your information from.
Bying stock is NOT a P& L entry but a Balance sheet.
Do change your accountant as he knows fuck all about correct accounting practices

[Paphitis]

Paphitis wrote:
They could show a loss, because the bought lots of stock, or plant and equipment, or did a stock adjustment or write off.

The Banks know its a loss on paper but not a loss in practice."

WRONG !!
Where on earth do you get your information from.
Bying stock is NOT a P& L entry but a Balance sheet.
Do change your accountant as he knows fuck all about correct accounting practices

It's a stock report addendum.

On the P&L you will only see Z Sundry Stock purchases as an expense.

The stock found in the stock report is indeed an addback and an asset item for the business.

Trained analysts know where to find profit in a company when there is no profit showing on the P&L.

And that isn't the only thing. There is a Balance Sheet and a depreciation schedule where you will find all the cars or other assets and their asset value.

The expenses for these cars or other things will be found once again in the P&L.

Not many people know how to read financials. Most people will see a reported loss and run a mile, when in actual fact there could be hundreds of thousands worth of hidden profits.