UK Cash -> Stocks without the UK authority knowing

[jangpark]

Hello all the great minds in this forum,

I am Cambodian, came to the UK in 2013 as a student with student visa. In 2018, I married a European lady and now have the EU pre-settlement status, I still maintain a residence in Cambodia where I go every year to visit family and friends.

Now, I'm a UK Ltd company director/shareholder with an annual salary of £12,000 and £10,000 dividends. On top of that income, I have an extra £50,000 in cash every year that government is unaware of.

What I am trying to do is to use that £50,000 cash to invest in the stock market without letting UK tax authority know about it. I have done some research and so far I only have 2 ideas

Option 1. I open a stock brokerage account, declaring myself purely as Cambodian citizen and only having tax residency in Cambodia. Then I open a personal bank account in an offshore jurisdiction, give the cash to someone in the UK and they transfer that cash to my offshore bank account, and I use the money in the offshore account to fund the brokerage account.

Option 2. Incorporate an offshore company and open a company account with the stockbroker, tell the broker I am Cambodian and has no residency in the UK

Here are my questions:
-Will my setup work? Does anyone have better ideas?
-Which broker should I use? I need them to be reliable, allows citizens of any country to open account, won't freeze funds randomly, and allows a bit of margin when I buy stocks?
-Where should I open the offshore bank account? Which offshore bank is open-minded and won't ask me where this money comes from and won't freeze my funds?
-If broker and bank asks for proof of funds for my personal account, what can I give them because as far as they are concerned, I am Cambodian and Cambodians don't make £50,000 a year. How likely are they to ask for these things?
-In the scenario where I open a brokerage account for the Ltd company, and the broker asks for source of funds proof but the company doesn't have any annual account, what do I give them?
-Which offshore jurisdiction should I incorporate the company in and have the company bank account?


Thank you all very much for reading.

 

[Sols]

Are we talking physical cash (pound sterling bank notes) or is the 50,000 GBP/year sitting in a bank account?

If it's cash and if you're in no hurry, fly with it to Cambodia and deposit in cash in a bank there, giving your Cambodian passport and UK address. When they ask for source of wealth, show them your 10,000 GBP dividends earning and explain you run a successful business in the UK. Spread it out over a few banks. Let it sit for a while. Gradually pool it together and wire into a broker.

It's not risk free but because your untaxed amount so greatly outweighs your clean, taxed amount, it'll be difficult to do the usual trick of using untaxed cash for day to day spendings and save/invest the rest. Be aware that this money laundering and you're setting yourself up for crimes far, far worse than just failing to pay tax.

The most sensible would be to declare your income to the HMRC, pay taxes owed and some penalties, apologise profusely, and move on with your life.

If the 50,000 GBP/year is sitting in a bank somewhere, you're a ticking time bomb.

BTW, if whoever is paying you the 50,000 GBP/year under the table gets busted, they might also find records of you and go after you that way, in which case having the cash sitting with a bank in Cambodia isn't going to help. In fact, it's going to make things a lot worse.

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This is the probably the answer to your question.

 

[jangpark]

Sols said:
Are we talking physical cash (pound sterling bank notes) or is the 50,000 GBP/year sitting in a bank account?
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Yeah, physical cash but it could also be transferred out using Transferwise.

Sols said:
If it's cash and if you're in no hurry, fly with it to Cambodia and deposit in cash in a bank there, giving your Cambodian passport and UK address. When they ask for source of wealth, show them your 10,000 GBP dividends earning and explain you run a successful business in the UK. Spread it out over a few banks. Let it sit for a while. Gradually pool it together and wire into a broker.
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-How much cash can I take with me when flying without having customs border question me?
-And if the broker asks for my source of funds, what can I give them? As far as the broker is concerned, I'm Cambodian living in Cambodia so I can't use UK tax return to prove it. Even if I can, the amount on UK tax return is only £22,000 while I have £50,000. What will satisfy the broker?
-Which broker should I use?

Sols said:
BTW, if whoever is paying you the 50,000 GBP/year under the table gets busted, they might also find records of you and go after you that way, in which case having the cash sitting with a bank in Cambodia isn't going to help. In fact, it's going to make things a lot worse.
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-I did think about it but there is no record so it's quite a low risk

Sols said:
It's not risk free but because your untaxed amount so greatly outweighs your clean, taxed amount, it'll be difficult to do the usual trick of using untaxed cash for day to day spendings and save/invest the rest. Be aware that this money laundering and you're setting yourself up for crimes far, far worse than just failing to pay tax.
Click to expand...

Yes I am aware, thank you for the heads up