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  1. #11

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    Quote Originally Posted by Alan @ BroomeAffinity View Post
    If you have an invoice outstanding you expect to be paid this will be an asset and therefore the dividend could potentially be legal. But take care and as said above you need to draw up a balance sheet first.
    would goodwill also count as asset?
    i.e. if you're part way through a months work but not yet got a time sheet signed, would that work count as an asset?

  2. #12

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    Get a decent accountant that offers freeagent. Your dashboard will tell you exactly what you can and can't take.

    I've worked with people with this attitude before and it's gone spectacularly wrong. I've seen a grown man close to tears after being given notice after spunking his entire reserves believing the rest of the gig will cover it.
    'CUK forum personality of 2011' - Winner - Yes really!!!!

  3. #13

    Godlike


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    I'm interested in this as it goes, as the other half is in the position that she has started something fairly recently (6 weeks ago) and has an invoice, for a month, outstanding. There is easily enough to pay all obligations tax wise + a few K surplus.

    She went without salary from her Co whilst she was working gratis for a start up.

    Are you saying, in this situation, Alan, that she could pay the back dated salary prior to actually being paid for the week invoice?

    This is theoretical, in that she doesn't operate "close to the line", anyway, far from it but would be good to know a definitive answer.

  4. #14

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    Quote Originally Posted by MrMarkyMark View Post
    Well, as you have described them, they would be illegal dividends in any case.
    They fit the exact description.
    Well yeah - but they are deemed illegal, only if you are not able to fulfill any payments ! say, your CT is due in March and you are low on balance in March because you paid yourself a huge dividend, then it is illegal. What if you don't have any obligations at that point or 2 months down the line ?

  5. #15

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    Quote Originally Posted by northernladuk View Post
    Get a decent accountant that offers freeagent. Your dashboard will tell you exactly what you can and can't take.

    I've worked with people with this attitude before and it's gone spectacularly wrong. I've seen a grown man close to tears after being given notice after spunking his entire reserves believing the rest of the gig will cover it.
    One of the reasons why some of us can work in contracting for a long, long, time and others can't.
    We can put up with bad times because we look ahead and do not take anything for granted.

    The most vulnerable I have felt was when I had not worked for just over a year, recession on, spent a lot of cash travelling and enjoying myself.
    Point being, I still had 20K in my business account after corporation tax.

  6. #16

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    Does this 20k in your co's bank account include money owed to the VAT man?

    He REALLY doesn't like when he doesn't get what's owed.

  7. #17

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    I think it's been touched on but where is your warchest in all this. Let's assume you get away with what you do. What happens if you get binned in 2, 3 or more months time and don't get a gig for a couple of months? What are you going to live on?

    Your risk is going through the roof. IMO you need to strongly consider this because you are looking at a 6 month + risk here, not just the next invoice.
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  8. #18

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    I'm just going to put this here to give the OP something to think over.

    Hi I have spent all of my tax & vat money to keep a roof over

  9. #19

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    For clarity, I suggested what I suggested because its legal. But that doesn't mean it's not stupid, or imprudent.

  10. #20

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    Quote Originally Posted by Lance View Post
    would goodwill also count as asset?
    i.e. if you're part way through a months work but not yet got a time sheet signed, would that work count as an asset?
    I don't think that's what goodwill is, but on the basis that you have to pay CT based on work done but not invoiced for then surely the same would apply for dividends.
    Special Discretion Required.

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