PAYE for small Ltd Co

Pricy147

Hi Everyone,

Looking for some advice.

Established a new Ltd co to invest into property for tax efficiency purposed (removal of MITR etc). Company has been running now around 15 months.

Two directors (myself and partner). My partner is full time employed - I have no other job since taking redundancy prior to the formation of the company.

Looking to take advantage of my tax free allowance for this FY. Therefore looking to setup payroll for the company. Have registered already, and now looking to download free payroll software and run payroll.

Not earned anything this year - so looking to pay myself circa 4k per month for next three months, and then lend back to the company as director loans (putting company 12k negative). Will also help me cover my NI contributions for this year. This will carry forward and help reduce corporation tax burdens when the company is more profitable in future years.

After April will then reduce to circa 1k pm (£12k pa).

So - never run payroll before having been full time employed. Is it straight forward (esp changing amounts monthly), and what would people recommend for free software given the basic use needed?

Regarding actually paying yourself as a director - do you just send the amount via online banking - or does the software undertake this task?

Any pointers or tips much appreciated.

Savvy_Sue

HMRC Basic Tools should do the job, BUT I'd strongly recommend that you get advice from your accountant! Easy to mess up the details in this situation.

Aquamania

Pricy147 wrote: »

Hi Everyone,

Looking for some advice.

Established a new Ltd co to invest into property for tax efficiency purposed (removal of MITR etc). Company has been running now around 15 months.

Two directors (myself and partner). My partner is full time employed - I have no other job since taking redundancy prior to the formation of the company.

Looking to take advantage of my tax free allowance for this FY. Therefore looking to setup payroll for the company. Have registered already, and now looking to download free payroll software and run payroll.

Not earned anything this year - so looking to pay myself circa 4k per month for next three months, and then lend back to the company as director loans (putting company 12k negative). Will also help me cover my NI contributions for this year. This will carry forward and help reduce corporation tax burdens when the company is more profitable in future years.

After April will then reduce to circa 1k pm (£12k pa).

So - never run payroll before having been full time employed. Is it straight forward (esp changing amounts monthly), and what would people recommend for free software given the basic use needed?

Regarding actually paying yourself as a director - do you just send the amount via online banking - or does the software undertake this task?

Any pointers or tips much appreciated.

https://www.gov.uk/payroll-software

I agree that you should consult your accountant especially with regards to how to best maxise your tax efficiency.

silvercar

Savvy_Sue wrote: »

HMRC Basic Tools should do the job, BUT I'd strongly recommend that you get advice from your accountant! Easy to mess up the details in this situation.

HMRC basic tools is very straightforward to run. Hmrc also run webinairs on how to use it and also on rental income.

You may want to consider paying yourself just under the NI threshold rather than the personal tax allowance, to avoid NI contributions.

Here is one link, plenty of others by searching 'optimum directors salary'.