A standard strategy for a small incorporated owner managed business or contractor is to extract profits from their company through a tax efficient mix of salary and dividends at the level of the higher rate income tax threshold of £42,385. For a sole director / shareholder who is entitled to the full tax free personal ...more
Director loans
There may be times when a director needs to borrow money from their own limited company. From an accounting perspective director loans are treated as follows: Loans outstanding at the balance sheet date must be disclosed in the company's financial statements and corporation tax return. Loans not repaid within 9 ...more
VAT flat rate scheme
The VAT flat rate scheme (FRS) is a simple way for small businesses to reduce administration and lower their VAT bills. With standard VAT accounting, the VAT a business pays or claims back from HMRC is the difference between the VAT charged to customers and that paid on purchases. With FRS however a business: ...more
Auto enrolment
Current pensions legislation means that every employer will need to enrol their UK based employees into a pension scheme if certain criteria are met. Guidance regarding auto enrolment: Staff aged 22 to state pension age with monthly gross earnings of £833 and above must be automatically enrolled and the company ...more
General duties of limited company directors
The Companies Act 2006 (CA) details the general duties a director of a limited company owes to the company which are to: Act only within the powers granted under the company's articles, memorandum of association and agreements of a constitutional nature such as shareholder agreements. Act in a way the director ...more