Self employed vs small business

[Mark Bolam]

My mate in HMP Durham.

[AHPP]

If you're serious, that requires expansion.

[Steve Bullman]

8 hours ago, AHPP said:

If you're serious,

You’ve not being paying attention for the past 15 years have you 

[Clutchy]

Any tree company IMO should be limited, for the liability side of things. Do not assume your house will not be taken, if you have signed any director guarantees which are sometimes hidden in lease agreements, they most certainly can take your personal assets 

 

If you're  a subbie its probably a lot less important/worthwhile. 

 

The advantages as limited if you're really raking it in could be: 

 

- Pay you and your wife £12,500 PA (no income tax, small bit of NI) and so long as there are 2 directors, you can offset 4k of employers NI 

 

- The rest pay as dividends after corp tax (although each year this advantage is being lessened). 

 

Very loosely speaking: 

 

Self employed on a 45k income you would take home £34,129 

 

Company with 2 directors would be closer to £39k take home after paying corp tax on the 21k left after wages 

 

Factor in an accountant at £500, you probably are better off limited, if you have a wife. 

 

If you are a sole director, its negligible. 

 

Please bare in mind ive roughly worked this out on site, so could be off a bit 

[Puffingbilly413]

8 minutes ago, Clutchy said:

Do not assume your house will not be taken, if you have signed any director guarantees which are sometimes hidden in lease agreements, they most certainly can take your personal assets 

Fair point. Not a route I have gone or would do down but understood that some might not have the choice if they want the finance.

[Mark Bolam]

Alex, I was jesting, but Clutchy has summed it up pretty well, as highlighted by Billy above.

 

A couple of mates have ended up in deep shit after their Ltd. co’s went pop, including a house repossession.

[Mik the Miller]

17 hours ago, Mark Bolam said:

<snip>

@Clutchy will have a far better grasp than me, I’m just a bitter and twisted old bastard who hates anything to do with tax.

 

Then you need to go and live in a bankrupt country. Sudan perhaps, any of the middle or Western Africa nations. Perhaps somewhere less dangerous like Argentina, Lebanon maybe, i'm sure that paying no tax will bring you great personal joy and benefit  😁

[AHPP]

1 hour ago, Mark Bolam said:

Alex, I was jesting, but Clutchy has summed it up pretty well, as highlighted by Billy above.

 

A couple of mates have ended up in deep shit after their Ltd. co’s went pop, including a house repossession.

 

They're not talking about piercing the corporate veil though. They're talking about voluntarily (albeit carelessly) parting it. Good point though.

Piercing in England is hard. You have to have been doing something dodgy. Your mates' companies going bust is going to coincide with them losing income from them and the resulting personal finance problems that usually causes (ie no money to pay the mortgage). Unless they had done something dodgy so a creditor was able to forcibly pierce the veil or they'd voluntarily parted the veil like Clutchy highlighted, it's probably less about the failure of limited liability as much as it is about the failure of business.

Edited April 27, 2023 by AHPP

[Mark Bolam]

42 minutes ago, Mik the Miller said:

 

Then you need to go and live in a bankrupt country. Sudan perhaps, any of the middle or Western Africa nations. Perhaps somewhere less dangerous like Argentina, Lebanon maybe, i'm sure that paying no tax will bring you great personal joy and benefit  😁

I don’t mind paying tax, I’ve paid quite a lot over the years.

It’s more what it’s spent, or not spent, on.

And the blatant theft that is inheritance tax.

[Mik the Miller]

1 hour ago, Mark Bolam said:

I don’t mind paying tax, I’ve paid quite a lot over the years.

It’s more what it’s spent, or not spent, on.

And the blatant theft that is inheritance tax.

 

Yes, best not to die with more than £325,000.00 in assets and cash.

You can give away £3000 a year to anyone you choose in the 7 years before you die ... tax free

You can give away/gift any amount 7 years before your death ... tax free

 

Keep records...

I am not a tax lawyer but have recently suffered from parents death.

Edited April 27, 2023 by Mik the Miller