The Tax I pay?

Discussion in 'Accounts & Finance' started by danny2k80, Nov 18, 2009.

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  1. danny2k80

    danny2k80 UKBF Newcomer Free Member

    28 3
    I am a director and 50% shareholder of a web development company but I also have a day job in order to help pay costs as we are a newly formed company.
    I am looking for information on a number of points.
    1. Can anyone give me a basic overview of all the taxes i will encounter being a director?
    2. What effect does being taxed as a director and owner as well as being employed in a job have?
    3. Any helpful advice or extra information would be grateful as I want to understand the taxing of a business and an employee as best as possible.

    Thanks a lot

    Daniel Smith.
     
    Posted: Nov 18, 2009 By: danny2k80 Member since: Sep 10, 2009
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  2. Alison Jones

    Alison Jones UKBF Newcomer Free Member

    902 150
    HI

    Would say it all depends on how much salary you get from your day job - if it pays enough to get your NI stamp or is more then your personal allowance use your personal allowance on that job and from company if profits pay yourself dividends. If job not enough to get NI stamp pay yourself through company enough to get NI stamp but not to pay tax and take rest in dividends.

    Alison
     
    Posted: Nov 18, 2009 By: Alison Jones Member since: Mar 14, 2008
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  3. elainec100@cheapaccounting

    [email protected] UKBF Newcomer Full Member

    13,267 2,882
    The company pays corporation tax.

    Then dividends can be distributed on any remaining profits after CT has been paid.

    As a shareholder you would be entitled to a share of divs in proportion to your share holding.

    If all of your income (salary, interest, divs etc) is below the higher rate threshold there is no further income tax to pay on your divs.

    You can take a salary from the business but as that would be second job you may be on a BR tax code - which means you pay tax on the salary.

    Only general advice can be given on a forum and I would always suggest getting specific advice on your circs from the accountant who is doing the limited co accounts.

    Just to help - these are the reporting requirements for a limited company:

    http://www.franklyaccounts.co.uk/fivefile.php
     
    Posted: Nov 19, 2009 By: [email protected] Member since: Nov 4, 2005
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  4. danny2k80

    danny2k80 UKBF Newcomer Free Member

    28 3
    I'm considering not taking a salary and just taking a dividend if possible.
    I am currently in preliminary talks with an accountant but I like talking to other people who are in a similar position.
    My salary is enough for what I currently need as for any expansion I will be seeking bank facilities.
    Could anyone tell em what the thresholds for NI and tax are.
    Thanks.
     
    Posted: Nov 19, 2009 By: danny2k80 Member since: Sep 10, 2009
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