Help for single director companies

ISASwitcher

So the Chancellor has just unveiled welcome support for 'self-employed' people. Simple question, maybe - does this support extend to people like myself who operate as a single director limited company? I am the majority shareholder and employ no staff. I have no contract of employment. I take a few hundred pounds each month in salary, the rest of my income being derived from dividends, which I received because I am a shareholder. Does the Chancellor's support package, as set out on Thursday 26 March, help me?

neilmcl

I didn't see anything in this for people like yourself tbh. Maybe when the full detail of the CJRS comes out they may allow directors to apply for the 80% salary grant, even though they can't be furloughed. I've heard rumours that they may well be looking at this but we will have to wait and see.

amykirk1996

gov.uk/government/news/chancellor-gives-support-to-millions-of-self-employed-individuals
"Those who pay themselves a salary and dividends through their own company are not covered by the scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.

neilmcl

amykirk1996 said:

gov.uk/government/news/chancellor-gives-support-to-millions-of-self-employed-individuals
"Those who pay themselves a salary and dividends through their own company are not covered by the scheme but will be covered for their salary by the Coronavirus Job Retention Scheme if they are operating PAYE schemes.

Look like the rumours are correct. It will be interesting what happens in practise when you are supposed to declare yourself as being furloughed even though you are still required to be in everyday control of your company.

nickykittykat

We will get paid 80% of our salary but when our salary is deliberately low - like £12K that is not going to cover bills!!!!  Surely there must be some way that they can help us get nearer the £2500?

Jeremy535897

If your salary was deliberately low, it means one of two things:

• you didn't need the money so left it in the company to save tax
• you took the money as dividends to save tax

rehollyne16

I am the director of my own business which I run as a limited company, myself being the only employee. I pay myself a wage from the company & also use dividends. I dot not use PAYE. Can you advise what I am able to claim for. I am a wedding photographer & all my work has been postponed cancelled for at least 3 months. I only have some moneys coming in from deposits but this is drying out. I will have no other income coming in at this time. My wife is a nurse so not sure if I would get anything through Universal credit. Thank you. I have over 3 years of tax returns.

nickykittykat

Jeremy535897 said:

If your salary was deliberately low, it means one of two things:

• you didn't need the money so left it in the company to save tax
• you took the money as dividends to save tax

- Genuine question - do you think I should be penalised for that now?  In other words  I had  a 'benefit' up front so now this crisis has hit it's tough luck?  

Jeremy535897

Given the Chancellor's comments about self employed people paying less into the system than employees (and how that's going to change), I think that is a very accurate summary. Clever way of dodging the manifesto commitment not to raise NIC.

Luvoj

ISASwitcher said:

So the Chancellor has just unveiled welcome support for 'self-employed' people. Simple question, maybe - does this support extend to people like myself who operate as a single director limited company? I am the majority shareholder and employ no staff. I have no contract of employment. I take a few hundred pounds each month in salary, the rest of my income being derived from dividends, which I received because I am a shareholder. Does the Chancellor's support package, as set out on Thursday 26 March, help me?

No, as I have been posting all day on this board, you are probably an employee and theredire covered by the already announced Coronavirus Job Retention Scheme , if you need to furlough yourself.

Potbellypig

nickykittykat said:

Jeremy535897 said:

If your salary was deliberately low, it means one of two things:

• you didn't need the money so left it in the company to save tax
• you took the money as dividends to save tax

- Genuine question - do you think I should be penalised for that now?  In other words  I had  a 'benefit' up front so now this crisis has hit it's tough luck?  

You can't deliberately give yourself a wage whereby you don't pay tax, whilst using the dividend system to pay less tax, and now expect the system to help you out. You can't have your cake and eat it.

Oh and I'm in exactly the same position.