Need rid of my accountant fast...Any good ones for under 50/pm

[THEPUMA]

If I had a non-working spouse I would definitely not do a 50/50 split unless I was damn sure that said spouse was making a 50/50 contribution to my business

OK fair enough. Are you aware that a dividend is a return on an equity investment whereas a salary is a reward for performance?

[LisaContractorUmbrella]

OK fair enough. Are you aware that a dividend is a return on an equity investment whereas a salary is a reward for performance?

Yes. So the initial investment would have to be 50/50 would it not which means that my spouse would make an equal contribution. My point is that an artificial structure is created to gain a tax advantage which has risks attached - SJD are aware of those risks and advise accordingly

[TheFaQQer]

Yes. So the initial investment would have to be 50/50 would it not which means that my spouse would make an equal contribution. My point is that an artificial structure is created to gain a tax advantage which has risks attached - SJD are aware of those risks and advise accordingly

Are you not a little biased in favour of SJD here, Lisa?

[Ravello]

Yes. So the initial investment would have to be 50/50 would it not which means that my spouse would make an equal contribution. My point is that an artificial structure is created to gain a tax advantage which has risks attached - SJD are aware of those risks and advise accordingly

That's a financial investment at whatever value is assigned to the shares at set-up, it has nothing to do with an ongoing contribution in terms of working for the company.

I could buy any publically listed share and own any available percentage of the overall shareholding without having to "contribute" to the actual day-to-day work undertaken by the company.

I would of course in those circumstances attend shareholder meetings etc. in the same way that my spouse would attend the such meetings for my limited if I chose to arrange such a set up.

[THEPUMA]

Yes. So the initial investment would have to be 50/50 would it not which means that my spouse would make an equal contribution. My point is that an artificial structure is created to gain a tax advantage which has risks attached - SJD are aware of those risks and advise accordingly

OK fair enough. Not sure if you are aware but there was a case called Arctic Systems heard at the House of Lords a few years ago. In that case, a married couple owned 50% of the shares each and made wholly unequal contributions to the business. The Lords held that the dividends, which were paid equally, were legitimate from a tax perspective.

Does that change your point of view?

[Danielsjdaccountancy]

OK fair enough. Not sure if you are aware but there was a case called Arctic Systems heard at the House of Lords a few years ago. In that case, a married couple owned 50% of the shares each and made wholly unequal contributions to the business. The Lords held that the dividends, which were paid equally, were legitimate from a tax perspective.

Does that change your point of view?

No it really doesn't. HMRC are not fans of income shifting, and will continue to look at this case by case.

Until they are happy, we won't promote share splitting. That doesn't mean however we won't allow a client to do it.

[LisaContractorUmbrella]

Are you not a little biased in favour of SJD here, Lisa?

Maybe But I do advocate caution Ltd or Umbrella and that is what they're suggesting so only a little bit biased.....perhaps......possibly

[LisaContractorUmbrella]

OK fair enough. Not sure if you are aware but there was a case called Arctic Systems heard at the House of Lords a few years ago. In that case, a married couple owned 50% of the shares each and made wholly unequal contributions to the business. The Lords held that the dividends, which were paid equally, were legitimate from a tax perspective.

Does that change your point of view?

Nope. You only have to go and look at the result of JLJ Services v HMR&C to realise that each case has to be taken on its own merits and that HMR&C are very fond of changing the goalposts. Personally I would forgoe £10k in tax savings to have the peace of mind of not having some Revenue inspector crawling all over my business but that's just personal opinion

[THEPUMA]

No it really doesn't. HMRC are not fans of income shifting, and will continue to look at this case by case.

Until they are happy, we won't promote share splitting. That doesn't mean however we won't allow a client to do it.

So do you also recommend that your clients operate on the basis that they are caught by IR35?

Incidentally, do you have any evidence that "HMRC are not fans of income shifting" in the context of contractors?

[Ravello]

The revenue will review income shifting on a case by case basis. So this means they could investigate regardless of the Arctic case, do you really want that hassle and HMRC crawling over your books.

I would like to hear about your SJD experience, so yes, please do PM Ravello.

I stick by my advice, if you would like to be running your Limited company in a certain manner, then first ask your accountant, challenge them if you are not happy with the response, research it and if you are still happy, then proceed to run it the way you want, an accountant should not be closing doors for you if you think you can pass through them.

It's your company and your responsibility and more importantly, your pocket!

PM sent.