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Draw salary from my limited company when out of contract

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    #31
    Did you ask what a shop owner does when no-one is in his shop?

    If he gave you the choice of leaving I'd snap his hand off. He must know something I don't but sounds like he doesn't have a clue what you do to me.
    Last edited by northernladuk; 7 January 2016, 14:49.
    'CUK forum personality of 2011 - Winner - Yes really!!!!

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      #32
      Originally posted by AnotherGuy View Post
      I've been in contact with them and the explanation is they don't recommend to take salary while my company is not generating income as (textual) "you can’t justify to HMRC why you want to take salary when you are not working" and (textual) "they will see it as tax avoidance".

      They said they are following HMRC guidance here

      They give me the choice to continue taking salary but apparently they ask for a written consent in case I were to be investigated by HMRC in the future.

      Absolute tulip.
      I didn't work for over a year once, due to choice, I still drew salary every month.
      In fact for all the 16 years I have been doing this, in contract, or not, I have always done so.

      Do yourself a favour, get rid of the accountant.
      The Chunt of Chunts.

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        #33
        Originally posted by MrMarkyMark View Post
        Absolute tulip.
        I didn't work for over a year once, due to choice, I still drew salary every month.
        In fact for all the 16 years I have been doing this, in contract, or not, I have always done so.
        Yep. I had 9 months of being out of contract but paid a salary every month until the company ran out cash. Only then did I think about signing on (I actually didn't, got another gig). That's the way a genuine business behaves, though some here would disagree.

        Reading it again I wonder if either AG or his accountant is confusing the word "salary" with "dividends". Paying dividends when the company has no income is hard to justify perhaps, though you can.
        Will work inside IR35. Or for food.

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          #34
          Originally posted by VectraMan View Post
          Reading it again I wonder if either AG or his accountant is confusing the word "salary" with "dividends". Paying dividends when the company has no income is hard to justify perhaps, though you can.
          No confussion regarding this. I've continued paying dividends, and also they've confirmed that is absolutely fine. The issue seems to be with salary and expenses. They think if I'm not on a contract I'm not "working" so they literally said: "You need to see yourself as the employee of the company. No company would pay a salary to you if you are not doing any work for them, same rule applies to your Ltd company as well."

          I'm a bit pissed off. Thinking what to do next.

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            #35
            Originally posted by AnotherGuy View Post
            No confussion regarding this. I've continued paying dividends, and also they've confirmed that is absolutely fine. The issue seems to be with salary and expenses. They think if I'm not on a contract I'm not "working" so they literally said: "You need to see yourself as the employee of the company. No company would pay a salary to you if you are not doing any work for them, same rule applies to your Ltd company as well.[/I]"

            I'm a bit pissed off. Thinking what to do next.
            Oh dear.

            What to do next is simple, fire the barstewards
            The Chunt of Chunts.

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              #36
              Next you get a better accountant.

              Most companies pay their employees when the employee is on holiday (I.e. Not working)
              …Maybe we ain’t that young anymore

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                #37
                Originally posted by WTFH View Post
                Next you get a better accountant.

                Most companies pay their employees when the employee is on holiday (I.e. Not working)
                Consultants, for example, get paid when they are on the bench.

                So, your accountant is a total bell end.
                The Chunt of Chunts.

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                  #38
                  You need to point out to him your job is being a contractor. That includes finding business, skilling up and at times being on the bench. Sitting on clients site working is the results of doing that work. That's you delivering your services but your job is to find that work. You should get paid for doing that job.
                  'CUK forum personality of 2011 - Winner - Yes really!!!!

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                    #39
                    I wager a lot of people here are not working whilst being paid.
                    Will work inside IR35. Or for food.

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                      #40
                      Originally posted by AnotherGuy View Post
                      No confussion regarding this. I've continued paying dividends, and also they've confirmed that is absolutely fine. The issue seems to be with salary and expenses. They think if I'm not on a contract I'm not "working" so they literally said: "You need to see yourself as the employee of the company. No company would pay a salary to you if you are not doing any work for them, same rule applies to your Ltd company as well."

                      I'm a bit pissed off. Thinking what to do next.
                      Fire them - they are clueless.

                      Ring InTouch and tell Louisa that I sent you their way (mention my forum name is fine )

                      Seriously, if they are getting this so completely wrong, then you need to worry about what else they are getting wrong.
                      Best Forum Advisor 2014
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