Company directors and universal credit

Entitled_to_Anything

Did you manage to apply for Universal Credit?

If so, what did you do about corporation tax payments, as this tax only gets paid once a year, it couldn't be claimed as a monthly expense, as far as I can tell?

Thanks

tomtom256

Entitled_to_Anything wrote: »

Did you manage to apply for Universal Credit?

If so, what did you do about corporation tax payments, as this tax only gets paid once a year, it couldn't be claimed as a monthly expense, as far as I can tell?

Thanks

Start a new thread, but to answer, I believe it's an expense in thre assessment period you pay it.

In regards to how the OP's partner would be treated, is as a self-employed person.

Search for the UCD5 as it is all explained in there.

He would report his share of the expenditure and income and UC would be calculated on that. His PAYE part would be an expense under UC as calculated as such.

ChrisConnolly

Dear All
First post. Found this thread quite useful.
Regulation 77 gives a definition of a company director being treated as gainfully self employed for UC purposes.
There is an exception - which is at (5) which states: -
(5) This regulation does not apply where the person derives income from the company that is employed earnings by virtue of Chapter 8 (workers under arrangements made by intermediaries) or Chapter 9 (managed service companies) of Part 2 of ITEPA.
I have looked at ITEPA Chapter 8 and feel more confused.
Example
Fred owns a 70% controlling share in a limited company that provides a service. There is another shareholder with a 30% interest. He is employed as a director but he is the "worker" for the business. Freds company have a range of clients that contract with his limited company on terms agreed for that service. 
Freds company has a turnover of c £35,000 PA. This may be received as three invoices. 
Fred receives a basic salary and occasional a small dividend. 

On initial view UC would treat Fred being gainfully self employer in any application for Child Tax Credit.
However, Fred does not contract directly with his clients. His company does.
Would Fred's company qualify as an  "intermediary" for the purposes of Reg 77 Clause (5) ?
Tax & Legislation are not a strength of mine. I guess that the definition of "worker" in both Reg 77 and Chapter 8 may be critical.
It does appear that UC Act 2013 and ITEPA 2003 are at odds on this point. 
All comments appreciated.

NedS

Generally, company directors are treated as being gainfully self employed on UC.

One exception that I'm aware of is if the director is effectively a director only on paper and has limited input into the running/direction of the company. For example, husband and wife are both directors of the company, but wife has no day to day input into decision making in the company and only 'does the books' or other administrative tasks. One could argue that she is not gainfully self employed as she makes no meaningful input into the day to day running of the company and her earnings should be treated as regular employed earnings, assuming the company pays her a salary reported through RTI. (no sexism intended, roles may be reversed)