Tax evasion advice!

Believe it or not, this is not per se illegal or as we lawyers say: "unlawful".

Suppose this dynasty lives in a kleptocracy and by the secomnd generation they have bought a couple off politicians in an unregistered informal limited partnership. The main business was so good that pots of cash literally were kept in the boardroom! When the next generation got to take charge, they sold off the main business as a recession was obvious. They washed much of that and all the previous cash through an obliging bank. It went abroad but came back in via a foreign trust owning shares in a foreign corporation. The corporation bought large tracts of prime land. As a corporation never dies, there will never be death duties or CAT or CTT or whatever. As ownership changes within the family the legal ownership remains the same and no one thinks to notify the Revenue Commissioners of the CGT liabilities. The Corporation is said to be non-resident and all board meetings take place in tax havens. The board are all hired flunkies, often the peasants of Sark etc and they act in accordance with the wishes of the shareholders for a stipend. Different corporations are used for different purchases.

We all know the old but true saw: "the first generation makes it, the second keeps it and the third spends it!"

This structure prevents any alienation. Lawyerspeak for you may enjoy a stream of income from it, but you, the profligate third and subsequent generations, can't sell the 'cos you never control it until certain events occur. These depend on that trust I mentioned earlier! The trustees are the shareholders..... It is all controlled by whomever runs the family fortune and should that person die, the next on the list takes opver. These two persons do not travel together in view of the finite possibility of joint death. Fortunes have been expended legally trying to decide which of two persons died first as the heirs, portions taxes may all differ. Ultimately a stuffy old lawyer can be appointed backstop but when the profligates disagree the lawyers often end up inheriting a fair share.

Some of the lawyers reading this know better than me that this is merely the basic structure and it is open to Anstalten in Liechtentstein etc to be employed to vary matters.

The point is that the Revenue Commissioners have never been very diligent, for reasons related to the Haughey threats to public servants, to use the "transfer of assets abroad" legislation brought in by Richie Ruin et al in 1974.

These corporations have been used for other things also. As they accumulate funds, they would be able to buy speculative land, for development. As it was obvious to quite a few that the events of 2001 meant that the USA was going to QE until the cows came home, it was time to put the said cows out to pasture.... Selling off land bought over a generation and ad hoc as suckers, (sorry novice developers) were encountered, these would all be flogged to what many would say were their competitors and would be competitors) in the game to end all games. The end of the boom or great moderation as it was termed, was clearly nigh. Some prize sites might be kept but why? They could all be bought back after the crisis, GFC, storm etc had passed, at a fraction of what they would fetch when sold now. The proceeds might be invested in many things, but a great idea from one of those oicky ex-tax inspectors might be used: invest in making funds available for their competitors to buy the land! Thus the banks would be able to lend more and more to these parvenues, ensuring hegemony of the family fortunes.