I could lose my new house what can I do please help

mouseclick

A_Nice_Englishman wrote: »

Yes I see you could look at it that way, but when I posted I had in mind that the company wasn't in fact making a profit of £1000 a month like he thought. Obviously a reputable accountant would ensure that all taxes due were paid.

I'm afraid I don't know enough about company taxation to know whether it is possible to make enough profit to pay a dividend yet not pay corporation tax.

Oh I see, sorry. I am not an expert at accounts either, and I know he is not! He just gives all his electronic figures and paperwork to the accountant, and he really pleased when he is told "no tax". He is probably guesstimating his £1000, and knowing him is forgetting about his outgoings such as website costs etc.

By the way all, his circumstances have again changed. I advised him several years ago about card tarting, and actually this is probably how his debts are so high, him being as he is. He rang earlier to say he had applied for a low interest credit card recently (0% for 13 months with 2% transfer fee) and it came through today. He intends to pay off the Citibank card and cut it up, he also hopes that he can transfer some money into his current account to carry him through to his first wage packet, so he is very relieved, though at the same time very worried about the mess he is in. But from what others have said here, it looks as if around £3K a month should get him out of immediate trouble, hopefully. But he knows he has a long way to go.
:beer: all

thecornflake

mouseclick wrote: »

He rang earlier to say he had applied for a low interest credit card recently (0% for 13 months with 2% transfer fee) and it came through today. He intends to pay off the Citibank card and cut it up, he also hopes that he can transfer some money into his current account to carry him through to his first wage packet, so he is very relieved, though at the same time very worried about the mess he is in. But from what others have said here, it looks as if around £3K a month should get him out of immediate trouble, hopefully. But he knows he has a long way to go.
:beer: all

Good sign that he got accepted for a card. It's a step in the right direction at least. I believe corporation tax is 22% or something on the profits, but I'm not sure about the tax free limit. He probably has it down as investing most of the profit back in the business or something, I'm guessing though as I don't know how it works.

Please ask him to sort out a decent SOA, then we can get him on the way to sorting it all out properly.

consultant31

mouseclick wrote: »

Talk to him not me

But you're doing all the talking for him, perhaps that's why people are saying "they".

I am immensely sorry for SLG and the situation he finds himself in, but sneaking around, hiding, sending summonses back "not known at this address" will not endear him to most of us who do pay our way.

The high taxes we pay may be a pain in the neck, but that is something else we all have to live with.

Get rid of the car (saving around £1250 a year) and stop the trips to Belgium to buy cigarettes and tobacco for (another huge saving over the course of a year).

Sarahsaver

Maybe the turnover is £1000 not the profit?
If you are a LIMITED company you can pay yourself a low salary, about 8.5k on which you have a bit of tax to pay (you have to be above the min. for NI contributions) then dividends on top of that; the dividends are taxed but the tax - corporation tax - is paid by the company, but they DO count when tax credit calculations are being made. AFAIK you pay corporation tax when profits are above 10k.
The 'accountant' does not sound reputable.

dubgirl

Hi, i have been following this thread and whilst I dont know much about tax, dividends etc, is it me or does the amount of tax credits (£70 pw) seem high. I understand that once you earned (whether single or joint) over £21,000 to £54,000then it was a fixed amount for everyone - £10 per week there abouts. I am concerned that the OP seems to want help and advice bout his debts, but doesnt want to be entirely honest and surely that is the first step in resolving the problem, well it certainly was for me - not called a light bulb moment for nothing!

hazelbunny

dubgirl wrote: »

Hi, i have been following this thread and whilst I dont know much about tax, dividends etc, is it me or does the amount of tax credits (£70 pw) seem high. I understand that once you earned (whether single or joint) over £21,000 to £54,000then it was a fixed amount for everyone - £10 per week there abouts. I am concerned that the OP seems to want help and advice bout his debts, but doesnt want to be entirely honest and surely that is the first step in resolving the problem, well it certainly was for me - not called a light bulb moment for nothing!

The op said his only income at the moment was £1000 per month, so £70 per week is spot on. He would be entitled to both child tax credits and working tax credits.

Alisonbel

If he now has this great job he needs to make sure he tell credits people. My husband got a slight, very slight, wage rise which took us just over the 21k mark. Didn't think it would make much difference so didn't think tell them, so now have no payments til aug 08 as they over paid us by £500. Sorry if I'm ranting but others seem to get away with allsorts, having read this thread I'm sure OP will find a way round this to!!

viktory

mouseclick wrote: »

Seems he told a few porkies on his mortgage application, mainly to get out of the area where he lived, because quite a high profile murder was committed near where he lived, was on a rough estate where stabbings occur, and did not want his son joining a gang. He knew this would create problems later, and of course now he has to deal with them. Now he is really happy with new neighbourhood, and school. Also he said that he asked Nemo for £20k, they gave him that, then phoned him up and offered a further £10k, which he took. Similarly, he bought a car, and they offered him finance too even though he said he had the money. So it looks as if these companies are not acting very responsibly (no surprise there I know). Anyway, discuss that with him.

As you are doing most of the talking for SLG, I am going to discuss this with, well whoever will listen! This post really makes me cross. SLG has admitted lying on the mortgage application, this is really, really bad. In fact, to my mind, it is obtaining goods by deception. Yes, he lived in a rough area, but so do many, many people. Me included. And I have a son that I worry about.

He then takes on more debt. Yes, the companies offered him the money, but he didn't have to take it!!! If he has a mortgage then they obviously see him as a low risk borrower. After all, if it all goes wrong, then can simply declare him bankrupt and take the house.

I get very angry when people blame the lending companies and not that fact that they took the money and spent it. As far as I am aware, these companies don't put a gun to your head.

Not impressed with the evasion of the TV licence fee either. I don't like paying it, but we all have to.

I do hope the SLG's new job works out well and that he manages to sort out his finances, but I would suggest that a huge change in mindset is most important. UNtil that happens SLG will never get his finances and life straight.

Finally, I agree that a proper SOA is required. Until that is posted no further help can be given. Perhaps you could help with that, mouseclick?

Debt_Free_Chick

mouseclick wrote: »

He has now gone off to chill out for a few days.

He has to do his SOA.

Not for us .... it doesn't matter whether we see it or not - but if we do, we may be able to help get his spending under control.

However, he MUST absolutely do it for himself and his family. As you can see from what he's posted, he doesn't have a clue how much money he needs each month to house, clothe & feed his family (and that includes all other stuff like insurance).

Get him to his SOA - and, if he wants our suggestions, to post it here.

thecornflake

I've sent him a budget spreadsheet that I use, which will also help him have a record of everything in one place.

I also pointed him to my diary thread which has an SOA that he can look at for a template.

I'm personally reserving judgement until I see the SOA and more details about his income etc, but I do agree on the points regarding TV license etc. I'm not condoning any illegal activity and hopefully he will get back on track and be able to start paying it asap and avoid any more dodgy stuff.