How much can I pay myself ? Tips

[Thehillman]

Hi , I’m completely new . Just setup my company
Made a few pound over lockdown Covid etc


I left my job , I have now opened up a Lloyds business bank account .
Now what do I do next ?
How much will I setup a payment into my own personal bank account so it means I have no big bill at the end of the year

I was told I can myself up to £350 a week .

I was going to sign up with Crunch they seem like they can setup everything and sort it all out for a fee each month

payroll etc I do not have a clue about this stuff unfortunately


Sorry but it’s all new to me

any help be grateful

 

[Scalloway]

If your limited company will be your only employment you should set up a payroll to pay you a salary. This salary will be a tax deductible expense for the company and you have a tax free personal allowance of £12,570, Also if your company pays you more than £120 a week you will get credit for NI contributions which will maintain your entitlement to certain benefits.

https://www.gov.uk/paye-for-employers/setting-up-payroll

If your company makes a profit you can take out any surplus profit after tax as dividend. You can take out £2,000 in a year before you need to pay any additional tax. Dividends paid do not affect the company's tax position.

https://www.gov.uk/tax-on-dividends

You should appoint an accountant who will guide you in this.

 

[paulears]

Have you set up as a limited company? I wonder if you’ve set up as a sole trader from how you’ve described things, and font quite understand how it works? I got this from you saying you’ve made a few pounds?

most accountants will tell you they will save you more than you cost, and as a sole trader who hates paperwork, paying staff via PAYE is horrible. I don’t get paid, I take drawings but the differences are important so an accountant is vital. They also will want you to use software they are comfy with, so see one urgently before signing up to anything.

 

[Deleted member 59730]

Made a few pound over lockdown Covid etc

That is the amount you can pay yourself!

 

[Paul MH]

payroll etc I do not have a clue about this stuff unfortunately

You should probably look into using an online accountancy firm like Crunch or Xero if you are looking to set up a limited company. There are a lot of different things you need to do to be compliant with the law. Setting up a business bank account is a small part of the process. These companies have accountants that are able to tell you what you can and can't do, and will help ensure that you are compliant legally.

You can also using a service like Companies made simple to actually set up the business if you haven't done that yet either.

 

[paulears]

The best thing I ever did was move from a big accountant to a small one - where they took the time and trouble to understand what I do. If they don't understand your business, and you - then how can they give anything other than generic advice? I'm a modest size business to my accountant - to the other people, I was tiny, insignificant and where the trainees cut their teeth. Like when I was being inspected and the only thing was a query on motoring expenses and I looked confused and my accountant said it was your car mileage - and I said, I don't have a car, I have a van, so I've always claimed all my fuel, not milage? The accountant, shuffled a few papers and said sorry I didn't know. The headings were van fuel, van insurance, van servicing, van repairs - nowhere was car mentioned. Clearly she had no idea at all what my business really was. The HMRC lady asked some spot questions - can you explain a few things? You've got 24 pairs of M&S ladies white underwear in the expenses? My accountant just dropped her jaw. I told the HMRC lady that they were for the dancers, as I needed all their underwear to match and the wardrobe lady washed them each day, so there were two sets. HMRC lady and me understood, my accountant was totally lost. My old accountant lost me soon after - my new accountant was recommended and has been brilliant, and when he doesn't understand something he asks, and often finds a better way of putting it in the books than I would have done.

 

[Elliot Green]

Hi , I’m completely new . Just setup my company
Made a few pound over lockdown Covid etc


I left my job , I have now opened up a Lloyds business bank account .
Now what do I do next ?
How much will I setup a payment into my own personal bank account so it means I have no big bill at the end of the year

I was told I can myself up to £350 a week .

I was going to sign up with Crunch they seem like they can setup everything and sort it all out for a fee each month

payroll etc I do not have a clue about this stuff unfortunately


Sorry but it’s all new to me

any help be grateful

Where does the figure £350 come from?

 

[Elliot Green]

Hi , I’m completely new . Just setup my company
Made a few pound over lockdown Covid etc


I left my job , I have now opened up a Lloyds business bank account .
Now what do I do next ?
How much will I setup a payment into my own personal bank account so it means I have no big bill at the end of the year

I was told I can myself up to £350 a week .

I was going to sign up with Crunch they seem like they can setup everything and sort it all out for a fee each month

payroll etc I do not have a clue about this stuff unfortunately


Sorry but it’s all new to me

any help be grateful

You need an accountant to sort this properly for you.