4 ms·

Right but eventually they money has to get from the company to the consultant - either dividends or wages. Either way it'll be taxed.

by rb808 7y ago

beefield 7y ago
Yep. Eventually. Meanwhile Buffett's tax rate on his (and his companies) income is within the distance of epsilon from zero. Can you estimate when Buffett is going to need the bulk of the money from his compankes to buy a new house? How long heis going to have approximately zero tax rate, that is? My personal estimate is with a very good approximation 'never'.
- s1artibartfast 7y ago
  As long as berkshire hathaway is paying capital gains on every investment, why would you care if the money stays invested in the company?
- mrep 7y ago
  Buffet pays capital gains taxes and most economists who argue for dropping the corporate income tax only recommend so with an increase in income/cap gains taxes or even merging them.
tim333 7y ago
Yeah maybe eventually. Though people try to find loopholes eg. move abroad, transfer the money offshore, lend the money to the consultant from the company rather than paying him or her, send the money to a company owned by an opaque offshore trust and so on. Big industries spring up to facilitate the avoidance that lobby politicians to allow the loopholes and so on. It can get kind of messy.
- jhall1468 7y ago
  Literally everything you mentioned isn't a loophole, it's tax fraud. Tax loopholes are what they do within a single jurisdiction to avoid taxes. What you're suggesting is transferring money from one jurisdiction to another, which can't be done tax-free.
  - tim333 7y ago
    On example under UK law is if you work abroad for a year and deemed non UK tax resident then you could receive income tax free during that period. The K2 scheme that Jimmy Carr took part in got a lot of coverage https://en.wikipedia.org/wiki/K2_(tax_scheme) https://en.wikipedia.org/wiki/K2_(tax_scheme)
leakybit 7y ago
Only if they needed the cash, or else the corporation would be a vehicle to store wealth.

Right but eventually they money has to get from the company to the consultant - either dividends or wages. Either way it'll be taxed.

by rb808 7y ago

Right but eventually they money has to get from the company to the consultant - either dividends or wages. Either way it'll be taxed.

beefield 7y ago

Yep. Eventually. Meanwhile Buffett's tax rate on his (and his companies) income is within the distance of epsilon from zero. Can you estimate when Buffett is going to need the bulk of the money from his compankes to buy a new house? How long heis going to have approximately zero tax rate, that is? My personal estimate is with a very good approximation 'never'.

s1artibartfast 7y ago
As long as berkshire hathaway is paying capital gains on every investment, why would you care if the money stays invested in the company?
mrep 7y ago
Buffet pays capital gains taxes and most economists who argue for dropping the corporate income tax only recommend so with an increase in income/cap gains taxes or even merging them.

tim333 7y ago

Yeah maybe eventually. Though people try to find loopholes eg. move abroad, transfer the money offshore, lend the money to the consultant from the company rather than paying him or her, send the money to a company owned by an opaque offshore trust and so on. Big industries spring up to facilitate the avoidance that lobby politicians to allow the loopholes and so on. It can get kind of messy.

jhall1468 7y ago
Literally everything you mentioned isn't a loophole, it's tax fraud. Tax loopholes are what they do within a single jurisdiction to avoid taxes. What you're suggesting is transferring money from one jurisdiction to another, which can't be done tax-free.
- tim333 7y ago
  On example under UK law is if you work abroad for a year and deemed non UK tax resident then you could receive income tax free during that period. The K2 scheme that Jimmy Carr took part in got a lot of coverage https://en.wikipedia.org/wiki/K2_(tax_scheme) https://en.wikipedia.org/wiki/K2_(tax_scheme)

leakybit 7y ago

Only if they needed the cash, or else the corporation would be a vehicle to store wealth.