Closing my company and entrepreneurs relief

[TomW1]

Hi,

I intend to close my limited company as I have now taken on full employment.

My accountant has finalised my Year 2 accounts which ended Sept 16, but I have one payment of nearly £3k which was for the month of October (Month 1 Year 3). There are no more payment/costs to the business since then and there shall be no more.

Is my accountant correct in that I can close the company and be fine to take the £3k out of my business account as payment to me via entrepreneurs relief?

If I do close the business, what tax/fees/etc (if any) will be applicable to that £3k before it reaches me?

Note - I have paid the VAT on this, £3k it is the net pay to my business.

I hope I've explained this, though I'm struggling to grasp the concept myself.

Thank you in advance for any advice

Tom

 

[Diamond Bookkeepers]

As long as you have paid the corporation tax on the money and you don't have any creditors outstanding then I believe your accountant is correct.

Check out the HMRC website - "strike-off-your-company-from-companies-register/close-down-your-company"

 

[STDFR33]

If ER applies, you can take the £3k as a capital distribution, which will be taxed at 10%.

On such a small sum, ER might not be the best thing to do. You should speak to your accountant for the best method of extraction.

 

[UK Contractor Accountant]

why don't you just wait until the 6 April 17 and then take it as a tax free dividend covered by the £5K dividend allowance