If I have a business in the UK that would be taking x amount profit per year, what if I pay employees in a low tax country like Philippines (freelancer rate is 8%).
E.g. they might do £400 worth of work, but I pay them £2000. This would be reasonable because £400 worth of virtual assistants is like £2000 in the UK for a similar role.
However, I can tell the virtual assistant that their actual money is £400 and the other £1600 is for me and that they should keep that aside. I can then tell them to buy me whatever with that money and they'll agree if they're trustworthy.
Is that legal? Because if it is, I'd be taxed only 8% rather than the much higher rate in the UK