Self employed vs small business

[Rich Rule]

IIRC the IHT bit is 325k per person, so if you are married then that is doubled.

 

So 650k allowance before paying tax to the Gov.

 

At least that was the case and advice when I made out my Will a few years ago.  Me and the missus are not married and the lawyer highlighted this and advised we get married as it would be financially beneficial for my kids.

 

 

[difflock]

The brothers accountant advised him to put his two rental houses in his wifes name, for tax purposes. Then she cashed him in. Mind you it was the best 200k he ever spent.

[treevolution]

13 hours ago, Clutchy said:

Yeah I know, I think they are trying to level the playing fields after the furlough scheme 

 

Even at 0 its still slightly better than self employed but the advantage is only £50ish a month 

 

Probably not worth it once you factor in an accountant vs self assessment only

It's getting really close now that you will pay the same tax whether you're Ltd or sole trader. 

 

The only real benefit will be you can control how much tax you pay on dividends and keep yourself under the higher rate. 

 

I once went over the higher rate as a sole trader and the tax bill was massive plus I had to pay back all the child benefit. 

 

Now I can leave the profit in the company and draw it later in life. 

[scbk]

12 hours ago, difflock said:

The brothers accountant advised him to put his two rental houses in his wifes name, for tax purposes. Then she cashed him in. Mind you it was the best 200k he ever spent.

Did she run off with the accountant?!

[difflock]

No, first a Dojo, who was also a builder, then a rough as f . . .plasterer, then f.... knows as she works her way down the food chain.

I gleefully suspect that in her and the brothers local community(since they have lived all their lives in the same small town) the word is out and nobody sane would touch her.

But it must be  tough for the 2 secondary school age children.

Edited April 28, 2023 by difflock

[oldwoodcutter]

A friend of mine was recently telling me of his investigation /audit.

He keeps an attack dog in his yard, so the hmrc man is at the yard gate ringing the visitors bell, with his dog going even more mental than usual.

Anyway upon safe entry the man says well at least we know your dog food allowance is all above board.

[difflock]

7 hours ago, oldwoodcutter said:

A friend of mine was recently telling me of his investigation /audit.

He keeps an attack dog in his yard, so the hmrc man is at the yard gate ringing the visitors bell, with his dog going even more mental than usual.

Anyway upon safe entry the man says well at least we know your dog food allowance is all above board.

I dont believe that yarn🤔, I mean, come-on, a Tax Inspector with a sense of humour🙄, it never happened!🤣

[dan blocker]

On 28/04/2023 at 07:24, Rich Rule said:

IIRC the IHT bit is 325k per person, so if you are married then that is doubled.

 

So 650k allowance before paying tax to the Gov.

 

At least that was the case and advice when I made out my Will a few years ago.  Me and the missus are not married and the lawyer highlighted this and advised we get married as it would be financially beneficial for my kids.

 

 

Just went on Martin Lewis’s website to confirm what I said? Google it and it will confirm what I’m trying to say. 

[Rich Rule]

I am not actually sure what you were trying to say.

 

When I did my will it was explained like this, it was also the case when my father passed away.

 

Each person has 350 k allowance.  If one partner dies and the leaves to the other then they pass away within a designated period, the kids would be inline to pay IHT of the value exceeded 350 k.

 

The same scenario but the initial couple are married.  The kids would then have double the allowance I.e 700k before being required to pay IHT. 
 

 

[Stubby]

8 hours ago, Rich Rule said:

I am not actually sure what you were trying to say.

 

When I did my will it was explained like this, it was also the case when my father passed away.

 

Each person has 350 k allowance.  If one partner dies and the leaves to the other then they pass away within a designated period, the kids would be inline to pay IHT of the value exceeded 350 k.

 

The same scenario but the initial couple are married.  The kids would then have double the allowance I.e 700k before being required to pay IHT. 
 

 

When my old Dad passed away ( my Mum having died some years previously ) my solicitor said with all the allowances added together we could have up to one million tax free .