Director/shareholders can at times find themselves in a situation where they have used business cash to fund personal purchases. It is important to record such transactions adequately in the company books to avoid potential issues with HMRC.
Dividend tax rules changed from 6th April 2016 onwards. All taxpayers, regardless of the rate at which they pay tax are entitled to a dividend allowance. From 6th April 2016 this was £5,000 and is set to be decreased to just £2,000 from 6th April 2018.
With the change from one tax year to the next comes a range of different tax rates, allowances and thresholds that can change the way in which you manage your taxes. A company director is typically paid a salary from the limited company, which is calculated very specifically to maximise tax-efficiency. Should you therefore increase or decrease your salary in this new tax year?
It is natural for friends and family to want the best for you, and quite often they take the opportunity to give advice based on their own circumstances. Once upon a time incorporation was, more often than not, the sensible option for a business once it's profits reached a certain level. However, in recent years changes to tax legislation means that many of the tax breaks no longer exist. Are there any remaining related tax benefits?
It isn't common knowledge that a specific type of life insurance cover, called Relevant Life insurance, is deductible for tax relief within the framework of a limited company. However, it is a valuable piece of advice, as savings of up to 52% can be made by switching policy.