This morning I was reading The Guardian’s Offshore Secrets series over my Rice Krispies and tutting at the companies involved. The firms named and shamed in the report are using tax havens to not only snaffle profits away from the UK tax authorities, but also to hide their true owners from prying eyes by nominating foreign company directors who serve no purpose other than to replace real names on a form. Think of them as the company version Domains by Proxy.
Given my breakfast activities, imagine my surprise this afternoon when, while playing with my new favourite service, Duedil (try it, it’s great) I ran across a business I know quite well apparently using an offshore solution to do…well, I’m not exactly sure what.
That company is ContractorUK, which runs a news and advice site very similar to Freelance Advisor, albeit catering for the more hardcore contractor end of the market.
Rather than having a regular company setup with a few Directors, a few shareholders, ContractorUK appears to be wholly owned by a parent company called Everlast Investments Ltd based in Jersey. This is not particularly uncommon – plenty of businesses operate through Jersey for tax minimisation reasons (Amazon, for example) – although I’m not aware of any web publishing / advertising businesses which benefit from such a setup.
Of course I fell down the rabbit hole and looked up Everlast Investments which, it turns out, is itself owned by not one company but two; Blue Sapphire Ltd and Gems Secretaries Ltd, with a 50% shareholding apiece.
These two businesses are joint licensees of Gems Trustees Ltd, which is based in a PO Box in Nerine House on Guernsey, which is owned by Nerine Fiduciaries, who offer – you guessed it – offshore intermediary services in the British Virgin Islands, among other places. So, unless I’m missing something, ContractorUK’s ownership seems to disappear into the mire of the Virgin Islands using services designed to protect the anonymity of the owner and minimise tax. This seems like an incredibly extravagant financial vehicle for a medium-sized trade publisher.
I’m sure ContractorUK have their reasons for operating like this, however I just can’t see why. A tax dodge doesn’t make sense – the advertising business isn’t profitable enough to warrant such manoeuvring.
So rather than sage conclusions I leave you with a question – what’s up with that?