Director Salary Optimisation

Options
Our situation:
Husband and wife, both directors, both 50% owners. Our startup now has income and we want to start withdrawing.
Wife has no income this year
Husband has 30k taxable from previous job

1. From what I've read, we get employers allowance on NI up to 4k (is this corrrect?)
2. This ^^ means optimal salary is using all the 12570 allowance. Is that still true now that we're half way through the tax year? So do we pay more like 2k/month for the rest of the year or stick with 1k?
3. For the husband, is it worth taking any salary this year at all? Would be taxed at 20% income tax. Would he pay employee NI - I've heard directors NI is paid annually, but how does that interact with his 30k earned and some amount of NI paid as an employee in another company?
4. Should we take dividends this year (before declaring any profit). There's the 2k allowance that might be beneficial to use if allowed.

Thanks in advance

Comments

  • gingerdad
    gingerdad Posts: 1,919 Forumite
    Name Dropper First Post First Anniversary
    Options
    Speak to an accountant would be the best option
    The futures bright the future is Ginger
  • Sandtree
    Sandtree Posts: 10,628 Forumite
    First Anniversary First Post Name Dropper
    Options
    Speak to an accountant and consider your longer term plans for the business, pensions etc.

    Its fine to try and minimise your income, though you are then paying corporation tax, but there needs to be a plan of what you'll do with the profits retained in the company 
Meet your Ambassadors

Categories

  • All Categories
  • 343.7K Banking & Borrowing
  • 250.3K Reduce Debt & Boost Income
  • 450K Spending & Discounts
  • 235.9K Work, Benefits & Business
  • 609K Mortgages, Homes & Bills
  • 173.3K Life & Family
  • 248.5K Travel & Transport
  • 1.5M Hobbies & Leisure
  • 15.9K Discuss & Feedback
  • 15.1K Coronavirus Support Boards