Setting up a limited company by myself or with my bro? Any accountants here??

Savvy_Sue

Have you been in touch with any accountants yet?

KILOCHARLIE

Sorry for the delay in replying Sue! No I haven't yet I'm afraid. Its on my to do list for next week.

CKhalvashi

pleasedelete wrote: »

Salary £10,000 or less (you pay yourself this every month - no tax and currently no employers NI but small amount personal NI). You can avoid NI altogether by paying less.

However won't build up NI credits for state benefits/pension etc.

I take £10k + divs (on over £100k p/a) for this exact reason.

antrobus

zygurat789 wrote: »

Semantics.
Any money you receive from any of these companies should, legally, be subject to PAYE.

Of course it's semantics. But the law operates on the basis of semantics. And taxation operates on the basis of the law, and so getting the semantics exactly right can be quite important sometimes.

As it so happens, the statement,

zygurat789 wrote: »

A director is an officer of the company and is, therefore by definition, an employee.

is wrong. A director is not "by definition" an employee. A director is an officer of the company who may or may not also be an employee.

For certain purposes, such as Income Tax, the distinction might not matter, because those semantically obsessed lawyers have ensured that any payments made to officeholders get treated in the same way as any payments made to employees. For example s5 of the Income Tax (Earnings and Pensions) Act 2003 - http://www.legislation.gov.uk/ukpga/2003/1/section/5

But for other purposes it does matter. See, for example Nesbitt and Nesbitt v Secretary of State for Trade and Industry.
http://www.venturegiant.com/news-channel-248-is-a-director-an-employee.aspx

antrobus

CKhalvashi wrote: »

However won't build up NI credits for state benefits/pension etc.

I take £10k + divs (on over £100k p/a) for this exact reason.

It's normally the case that directors get paid at least whatever is the NI lower earnings limit for the year in order to qualify for a pension credit; £5,700 a year or whatever the number is these days.

zygurat789

http://www.hmrc.gov.uk/payerti/getting-started/paye-basics.htm

HMRC say directors are employees.

p00hsticks

zygurat789 wrote: »

http://www.hmrc.gov.uk/payerti/getting-started/paye-basics.htm

HMRC say directors are employees.

That link says
"PAYE (Pay As You Earn) is the system that HM Revenue & Customs (HMRC) uses to collect Income Tax and National Insurance contributions (NICs) from employees (including directors of limited companies). "

To me that reads that directors MAY be employees, not necessarily that they HAVE to be .....

[Deleted User]

zygurat789 wrote: »

Semantics.
Any money you receive from any of these companies should, legally, be subject to PAYE.

That may well be your opinion, but I know of no such law requiring such.
(unless they are an employee and falls within the rules of the PAYE scheme)

[Deleted User]

zygurat789 wrote: »

http://www.hmrc.gov.uk/payerti/getting-started/paye-basics.htm

HMRC say directors are employees.

Do you have a link to that assertion? :huh:

Because it does not say that in the link you have provided

And you're the one goinig on about semantics... :cool:

zygurat789

p00hsticks wrote: »

That link says
"PAYE (Pay As You Earn) is the system that HM Revenue & Customs (HMRC) uses to collect Income Tax and National Insurance contributions (NICs) from employees (including directors of limited companies). "

To me that reads that directors MAY be employees, not necessarily that they HAVE to be .....

It can't be clearer than that.