Self Employed LTD Company worker entitled to anything?

Entitled_to_Anything

Thanks once more.

Ah right. If we report the money coming into the LTD company account, instead of our personal accounts, then I don't think we would qualify as we leave about 20 percent in the LTD company account for corporation tax but only pay it once a year.

So it would look like we have 20 percent more coming in each month than we can spend!

That's a shame, got a bit excited there for a minute.

calcotti

Entitled_to_Anything wrote: »

Thanks once more.

Ah right. If we report the money coming into the LTD company account, instead of our personal accounts, then I don't think we would qualify as we leave about 20 percent in the LTD company account for corporation tax but only pay it once a year.

So it would look like we have 20 percent more coming in each month than we can spend!

That's a shame, got a bit excited there for a minute.

Could look into whether or not you can phase payments of Corporation Tax - I have no idea.

whizzywoo

You can make make payments for Corporation Tax as often as you like. It's not a problem and many company directors do this especially if they are not disciplined enough to keep the money on one side.

You can normally make these payments via the Business Dashboard on the Company's Gov Gateway account.

pmlindyloo

Entitled_to_Anything wrote: »

I filled out the form on the entitled to website and it said we were entitled to some benefits, but I'm not sure this is correct.

Can anyone please provide any info?

Me and my spouse both work as freelancers through our LTD company.

We get a salary and dividends from the LTD company.

Last year, that came to £18,XXX each (haven't got the exact figure to hand).

Salary was £8,xxx and the rest dividends.

This tax year should be similar

Some more info about us:

• We have two kids in school.
• We rent privately (£1350 a month).
• Council tax is £ 1,671 per year.
• We get child benefit of about £137 per 4 weeks.
• We have no savings.
• We each work 30 hours a week (although can vary).

If I put those figures into the Entitled To website, it said that we could get Universal Credit:

Can that be right?

If so, can you claim Universal Credit when working through a limited company like we do?

If we could claim, would they need to see our bank accounts or just our tax returns?

Can we back claim for last year/months past?

Any info much appreciated!

Thanks.

I noticed that you say you get a salary. Is this through PAYG and therefore declared to HMRC?

It is possible in such a scenario that you could be both self employed and an employee.

To be honest this is complicated for anyone on this forum to work out without knowing all the specific details of how your company has been set up.

Do you have an accountant who advised that you paid each other that salary (say, for income tax thresholds?) while the rest was taken as dividends?

I am not an expert I hasten to add and this could be a complicated situation.

If you apply for Universal Credit your first meeting at the Job Centre would, no doubt, involve working out exactly how your income is treated.

calcotti

pmlindyloo wrote: »

I noticed that you say you get a salary. Is this through PAYG and therefore declared to HMRC?

It is possible in such a scenario that you could be both self employed and an employee

For tax purposes a person employed in a company they own is an employee. However for UC they are treated as if self-employed because otherwise there is too much scope to manipulate the flow of income to enhance benefit entitlement.

Entitled_to_Anything

calcotti wrote: »

Could look into whether or not you can phase payments of Corporation Tax - I have no idea.

From doing a quick search, it looks like if your business turnover is more than £1.5 m then you will pay it frequently.

In my case, I get 9 months to pay it from when the amount is calculated.

So I could pay it monthly, each month, for 9 months, That would count as a monthly expense I guess?

Entitled_to_Anything

whizzywoo wrote: »

You can make make payments for Corporation Tax as often as you like. It's not a problem and many company directors do this especially if they are not disciplined enough to keep the money on one side.

You can normally make these payments via the Business Dashboard on the Company's Gov Gateway account.

That's good to know, thanks. Is that even before the corporation tax has been calculated? If so, I guess the downside is that you might over pay?

Entitled_to_Anything

pmlindyloo wrote: »

I noticed that you say you get a salary. Is this through PAYG and therefore declared to HMRC?

It is possible in such a scenario that you could be both self employed and an employee.

To be honest this is complicated for anyone on this forum to work out without knowing all the specific details of how your company has been set up.

Do you have an accountant who advised that you paid each other that salary (say, for income tax thresholds?) while the rest was taken as dividends?

I am not an expert I hasten to add and this could be a complicated situation.

If you apply for Universal Credit your first meeting at the Job Centre would, no doubt, involve working out exactly how your income is treated.

Yes, the accountant said to pay a salary of £8,xxx. That way you don't pay any NI but get state pension credits or whatever it's called.

Then take the rest as dividends.

The income is listed on our personal tax returns as salary and dividends.

We are both the 50/50 owners of the business.

I guess Universal Credit isn't really an option with LTD company workers.

calcotti

Entitled_to_Anything wrote: »

. I guess Universal Credit isn't really an option with LTD company workers.

Yes it is, as explained in this thread.

Entitled_to_Anything

Sorry, you are right. I just can't get my head around it!

I don't see how it could work in my situation, where I'm putting money aside for end of year expenses, rather than paying those expenses monthly.