Advantageous to use an Ltd co to invest in metals or not?

LinuxAllTheWay

Hi,

I am one of three directors is a modestly successful/profitable limited company.

We're currently looking at ways of putting our profits in medium to long term investments that are reasonably safe and offer better rewards that the savings account we're currently using (0.5%, Barclays).

After researching metals, I'm minded to think that silver, copper and titanium would be a good area for some of our money to go. Granted copper prices are trending downwards at the moment but the general consensus of opinion is that that will reverse in time.

Also, metals would only make up between 10% and 15% over our eventual investment portfolio. This thread is intended to only concentrate on metals for the time being though.

So, the questions:

1. Are we better off getting the ltd co to purchase the metals?
2. Are we better off paying out the profits as dividends and sorting our own investments out (all three of us want to invest our profits, it's just a case of where and how)?
3. I have secure storage available to me which I can use to store and metals purchase. Is purchasing a physical bar/coin a better way to go than say paper trading?
4. If purchasing physical bars/coins, can anyone recommend a service/dealer who can supply?
5. If paper trading, who would you use?

I'm sure more questions will arise but I think that's enough to be going along with. Please let me know if you need any further information.

Cheers,

Richard

smeagold

If the company runs into difficulty though the investments will be classed as assets of the company. With a Dividend, so long as your balance sheet supports it for the fiscal year(is it still taxed at 10%? its a while since I was a director of an Ltd) there no chance they can ever come after you for that dividend. Plus each of you can individually allocate what you want, in wahtever asset, as each see's fit.

If you have storage I'd go for physical, it has zero counterparty risk.

silver/gold suppliers:

https://www.bullionuk.com/

http://www.atsbullion.com/

http://www.bullionbypost.co.uk/

many are now experiencing supply delays shortages tho.

GLD SLV ETFs allow for paper trading. as does Bullion Vault(gold)

Just my 2c worth, orthers hopefully will chip in too.

Pachira

Might be worth seeking professional advice on this as depending on the amount you are looking to invest it could have implications on Corporation Tax (eg you don't want to accidentally end up being classified as a Close Investment Company), Entrepreneur Relief and IHT. You might find following site helpful:
www.traderstaxclub.co.uk

Jonbvn

smeagold wrote: »

If the company runs into difficulty though the investments will be classed as assets of the company. With a Dividend, so long as your balance sheet supports it for the fiscal year(is it still taxed at 10%? its a while since I was a director of an Ltd) there no chance they can ever come after you for that dividend. Plus each of you can individually allocate what you want, in wahtever asset, as each see's fit.

But gold pays no dividends?

xrjtg

Jonbvn wrote: »

But gold pays no dividends?

I'm sure you must know this, but to clarify: profit is extracted from limited companies in the form of dividends. Once paid out they can't be clawed back if the company goes belly-up. Any dividends on investments held are a separate issue. smeagold is pointing out that keeping investments inside a limited company is much more risky than moving them out.

smeagold

xrjtg wrote: »

I'm sure you must know this, but to clarify: profit is extracted from limited companies in the form of dividends. Once paid out they can't be clawed back if the company goes belly-up. Any dividends on investments held are a separate issue.

Thats not correct and I have experience in that, so long as the profits for the fiscal year ending support the dividend paid and were paid out, on the baisis of the years profits then the tax man cannot get that back . it was approved by the accountant and the tax of 10% was paid. The tax man chased me for 28k for a year over such this thing and in the end admitted that the div was lawfully paid on the basis of profit for that year. the case was dropped despite owing 40K in unpaid company tax,.The company is limited, limited risk

xrjtg

smeagold, I think we're in violent agreement! I was hoping to avoid any potential confusion caused by Jonvbn's dig.

I've edited my original post to make this extra clear.

smeagold

xrjtg wrote: »

smeagold, I think we're in violent agreement! I was hoping to avoid any potential confusion caused by Jonvbn's dig.

I've edited my original post to make this extra clear.

yeah your right sorry mate misread that one!!

Jonbvn

I wasn't having a dig.

Treesie

smeagold wrote: »

The company is limited, limited risk

Except to the tax man, the vat man and the bank !

LinuxAllTheWay

Thank you to everyone who has commented. Your input has been incredibly useful.

Would it be of benefit to know what my ltd company does in order to answer my questions above or would that be immaterial?