Accountant is coming back to me on Monday, was escalated to his boss and even she wasn't certain
If anyone here would just clarify the points below I'd really appreciate it:
1. The 5% expenses inside IR35 is based on gross revenue
2. The 5% can be used for certain business expenses (accountancy for example). If you don't 'spend' the whole 5%, anything left is retained in the business as profit. This can therefore be withdrawn as a dividend, subject to CT.
3. The deemed payment calculation starts with the total turnover (VAT Exclusive) so this will leave the gain from the 13.5% FRS in the company account too. E.g
Gross turnover = £130,000
Net 20% VAT = £104,000 (this is used for deemed calc)
VAT to HMRC = 13.5% = £17,550
FRS Gain = 6.5% = £8,450
5% expenses = £6,500
So......£8,450 + £6,500 = £14,950 (this is the money my accountant right now can't explain to me what happens!)
If anyone here would just clarify the points below I'd really appreciate it:
1. The 5% expenses inside IR35 is based on gross revenue
2. The 5% can be used for certain business expenses (accountancy for example). If you don't 'spend' the whole 5%, anything left is retained in the business as profit. This can therefore be withdrawn as a dividend, subject to CT.
3. The deemed payment calculation starts with the total turnover (VAT Exclusive) so this will leave the gain from the 13.5% FRS in the company account too. E.g
Gross turnover = £130,000
Net 20% VAT = £104,000 (this is used for deemed calc)
VAT to HMRC = 13.5% = £17,550
FRS Gain = 6.5% = £8,450
5% expenses = £6,500
So......£8,450 + £6,500 = £14,950 (this is the money my accountant right now can't explain to me what happens!)
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