Bailey. Posted November 5, 2011 Share Posted November 5, 2011 Talking to my accountant in brief today, and talking about how much tax i will pay in january, he said why dont i go limited? I have no idea what the gains would be, anybody with experience with this who could comment would be much appreciated. I have a meeting with him on tuseday and dont want to go into it with no idea what im talking about, Quote Link to comment Share on other sites More sharing options...
grahamc Posted November 5, 2011 Share Posted November 5, 2011 what do you do? Quote Link to comment Share on other sites More sharing options...
Bailey. Posted November 5, 2011 Author Share Posted November 5, 2011 I repair white goods, I took over my dads business around 4 years ago, he takes the calls and does the paperwork and I do the repairs. However he doesn't take a wage. Quote Link to comment Share on other sites More sharing options...
grahamc Posted November 5, 2011 Share Posted November 5, 2011 not my area of expertise, but I am suspecting that you can right more off as a limited company Quote Link to comment Share on other sites More sharing options...
Scott Posted November 5, 2011 Share Posted November 5, 2011 I might be thinking about this wrong but if you were a limited company the company would make the money and you would give yourself a wage. You would obviously pay the standard taxes etc on the wage but the company profits would be taxed at a lower level. If you just took all the money as wages you would take a much bigger hit from the tax man. I know very little about this side of things though, it's just my very very basic understanding of the main benefit. Quote Link to comment Share on other sites More sharing options...
grahamc Posted November 5, 2011 Share Posted November 5, 2011 I might be thinking about this wrong but if you were a limited company the company would make the money and you would give yourself a wage. You would obviously pay the standard taxes etc on the wage but the company profits would be taxed at a lower level. If you just took all the money as wages you would take a much bigger hit from the tax man. I know very little about this side of things though, it's just my very very basic understanding of the main benefit. Thats correct as well... My missus runs her own LTD company for IT contracting, claims a minimum wage every month, claims a lot of expenses and then pays out dividends every 6 months. Its a little painful with having a lot of money in the business account and not being able to use it. Quote Link to comment Share on other sites More sharing options...
Ricky49 Posted November 5, 2011 Share Posted November 5, 2011 Surely your accountant would know the pro's and con's. Quote Link to comment Share on other sites More sharing options...
johnny g Posted November 5, 2011 Share Posted November 5, 2011 Thats correct as well... My missus runs her own LTD company for IT contracting, claims a minimum wage every month, claims a lot of expenses and then pays out dividends every 6 months. Its a little painful with having a lot of money in the business account and not being able to use it. Has she gone to a tax consultancy for advice on the best way to get it out? If you want info, drop me a PM Quote Link to comment Share on other sites More sharing options...
grahamc Posted November 5, 2011 Share Posted November 5, 2011 Has she gone to a tax consultancy for advice on the best way to get it out? If you want info, drop me a PM Yes, she has a big accountancy firm on the payroll, but they are very vague in the responses.... might be switching soon. But we use it as a forced savings for future plans (when we will need it to continue paying a salary) Quote Link to comment Share on other sites More sharing options...
Bailey. Posted November 5, 2011 Author Share Posted November 5, 2011 Surely your accountant would know the pro's and con's. Of course, but its my money and I want to be sure it's the right way to go, this year by a long way will be the biggest turnover by almost double, so it's never been suggested before. Quote Link to comment Share on other sites More sharing options...
scorling Posted November 5, 2011 Share Posted November 5, 2011 There are some details to consider but in the simplest of terms, and only considering the tax aspects, if you are making in excess of £25,000 year profit, then a limited company is almost certainly to be the right way to run the business. Happy to give you some more background if you want to PM me (an accountant since the days of black and white) Quote Link to comment Share on other sites More sharing options...
Bailey. Posted November 5, 2011 Author Share Posted November 5, 2011 Thanks mate;) Quote Link to comment Share on other sites More sharing options...
Guest powerslide Posted November 5, 2011 Share Posted November 5, 2011 you can claim a wider range of expenses if u have ltd company. tax on dividends is far less than the income tax you pay on your salary! if you have an office in ur house i.e. the company is registered at ur home address, u might be able to claim some of the enegery bills as company expenses! plus, if your company shows a loss in first 3 years (not sure on exact number here), you can claim back some PAYE paid on your previous job! moreover, you can also claim back VAT on your purchases, obviously, u need to be VAT registered for that! From a different point of view, if you repair something and it blows up on someone (touch wood), you only have a limited liability if ur working behind the barriers of a ltd company! the legal system treats the company as a seperate entity from you loads to fiddle around Quote Link to comment Share on other sites More sharing options...
Abz Posted November 6, 2011 Share Posted November 6, 2011 Thats correct as well... My missus runs her own LTD company for IT contracting, claims a minimum wage every month, claims a lot of expenses and then pays out dividends every 6 months. Its a little painful with having a lot of money in the business account and not being able to use it. My colleague is leaving our firm to do contracting work as a SAN Storage role, he said the same about going as a limited company & then paying himself the min wage & then everyone 3 months or so paying dividends. He is also putting his missus on the books (she will be doing admin work), so she will also be paid a wage which reduces the amount the tax man gets. A lot of accountancy companies offer this sort of service for a fee (normally between £70-150) a month, where they look after all the books & advise how much to keep aside for tax etc. I'd recommend you serious consider the options. Quote Link to comment Share on other sites More sharing options...
Wez Posted November 6, 2011 Share Posted November 6, 2011 Go LTD, with the right advice it's much better Quote Link to comment Share on other sites More sharing options...
wile e coyote Posted November 6, 2011 Share Posted November 6, 2011 We have just gone ltd after 13 years fed up now with paying too much Quote Link to comment Share on other sites More sharing options...
Bailey. Posted November 6, 2011 Author Share Posted November 6, 2011 We have just gone ltd after 13 years fed up now with paying too much We have roughly worked out I will be paying 11k tax in the next 12 months and as well as saving for a deposit it's so bloody hard, and I have friends who don't work, have kids, get there rent and council tax payed and get a nice cheque each month For £1600. It's doesn't give you much inspiration to want to work your arse Off and go through life staying true to what u was taught as a kid. Edit- rant over, a little off topic Quote Link to comment Share on other sites More sharing options...
Lbm Posted November 6, 2011 Share Posted November 6, 2011 Plenty of advice on here, but quite frankly, it is your your accountant who you are paying who should explain your options clearly, regarding your tax issues Sorry, I haven't use itallics in a while Quote Link to comment Share on other sites More sharing options...
Scott Posted November 6, 2011 Share Posted November 6, 2011 Plenty of advice on here, but quite frankly, it is your your accountant who you are paying who should explain your options clearly, regarding your tax issues Sorry, I haven't use itallics in a while What's the excuse for the bold? The bannanas? The red top after communist day? Quote Link to comment Share on other sites More sharing options...
Lbm Posted November 6, 2011 Share Posted November 6, 2011 What's the excuse for the bold? The bannanas? The red top after communist day? I was just feeling the bold. I thought too many itallics is so passé Quote Link to comment Share on other sites More sharing options...
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