Getting money out of our business.

[anony-mouse]

I part own a small ltd company, and would like to know what's the best way to get money out of the company, tax efficiently, or even if we should.

At the present the directors pay themselves just below the higher rate tax band, around £15,000 paye and £15,000 in dividends we also put £15,000 into our pensions.

This leaves a large amount of retained profits each year, and its growing fast

Do you think we should take more money out of the business? or leave it? and what's the maths behind your reasoning because I can not get my head round it.

Next Question:
We have a large amount of money on deposit, sitting there earning a little interest. Should we invest it? Where?

How does Business Angels work, does it take much time (as I need to concentrate on our growing business) can businesses invest or is it individuals, we've looked a buying premises but there's very little around.


anony-mouse

 

[mattley23]

Surely being a LTD company who makes a decent amount of profit should have an accountant. If so they will be able to advise you the easiest way to draw money out of the business the right way.

If not, id advise getting one straight away.

Otherwise you can alsways log onto www.taxationweb.co.uk and they will hel you in loads of different ways through email advice or books you can buy.

Sorry I can offer any direct advice but never been in control of a Ltd company before

 

[Let it ride!]

I currently have enquiries from 14 potential businesses that are looking for funding of which three have some real merit:

1) Company looking to expand into personal ski-training utilising specially contructed machines (already developed and produced) £250,000

2) Mail-order marketing of specialised baby skin and nursery products - £25,000 to £50,000

3) Specialised carpentry machine tool (already developed and produced)
- £40,000 to £50,000

If you have any interest come back to me.

Kind regards
Ian

 

[Gillie]

As Mattley said, I cant believe you dont have an Accountant .... he is the one to ask all these questions to, its what you pay him for .... he will advise you on your best course of action.

 

[anony-mouse]

Hi, yes we have an accountant.

But as this is a how long is a piece of string type question, his response will probably be What do you want to do. So im looking for ideas as to what others do, should we retain profits in the company or take them out, im sure there will be lots of different opinions.

 

[Gillie]

No his response should be to sit you down and explain to you all the ins and outs and talk it through with him. If he is asking what you want to do without first talking it through with you, get a new Accountant!

 

[PeteA]

Mouse this may help a little

Are you one of the 450,000 small businesses missing out on up to £2,500?
Article provided by Business121.co.uk
It was revealed last week that an estimated 450,000 small businesses have failed to claim rate relief that they are entitled to. For some small businesses the relief can be worth £2,500.


The staggering failure to communicate to small businesses that they could be entitled to Small Business Rate Relief (SBRR) and how to make their claim, was uncovered by a survey conducted by the Local Government Association. The SBRR scheme, which came into effect on 1 April 2005, was announced in the Budget in March but has been very poorly publicised. To date, less than half of the small businesses that are eligible have claimed the relief they're entitled to.
We highlighted the issue in a news article on Bytestart (see Small Business News below) and with £400 million in small business rate relief still sitting unclaimed, it's important that we get the message out to as many small businesses as possible.

WHAT IS SBRR AND WHO IS ELIGIBLE?
The Small Business Rate Relief Scheme gives eligible businesses with rateable values of below £5,000, rate relief of 50%. So it HALVES YOUR BUSINESS RATES. This relief decreases on a sliding scale by an estimated 1% for every £100 of rateable value from £5,000 to £10,000.
The relief is available to ratepayers with either; one property, or one main property and other additional properties, providing the additional properties do not have individual rateable values of more than £2,200, and the combined rateable value of all the properties is under £15,000 (or £21,500 in London).
In addition to this, eligible businesses with rateable values of between £10,000 and £14,999 (or between £10,000 and £21,499 in London) will have their liability calculated using the small business multiplier.
You can find precise details of Small Business Rate Relief on this page of the government's mybusinessrates website; http://snipurl.com/_SBRR_details

HOW TO MAKE YOUR CLAIM
As with any government scheme, it's not straightforward. If you think that you may be eligible for small business rate relief you should get in touch with your local council urgently. They will be able to tell you whether you qualify, and will calculate the exact amount of relief you are eligible for.
If you need to find the details of your local council, you can do so here
The last date for applications for this financial year is 30 September so you don't have very long to get your claim in!
Finally, with less than half of small businesses claiming their relief, the chances are, you know businesses that are missing out on this. So please do forward this email to any small business that might be eligible. You could just save them up to £2,500, and I'm sure they'll be grateful to you.