SATR Question : Completing Employment Page for Ltd Company director

[dagenheis]

Hi,

Do we need to fill in the Self Assessment Tax return employment page for being a Ltd company director if there was no salary or benefit paid to the director ? The company does not operate PAYE. Moreover, dividend payment is within dividend allowance which are reported on a separate page anyway.

It does not take much time to fill a blank employment page with the option "if you were a Company director" checked (X). But just wanted to do a sanity check as the notes below sort of suggest the employment page is not required for Company Director if there is no income but they may deregister for SATR which is really not an issue in this instance.


Appreciate your thoughts. Cheers!

N.B:
The 2018 sa102-notes for employment page reads
"Box 6 If you were a company director Put ‘X’ in the box if you received income orbenefits as a company director. If you were a
company director and didn’t receive any income or benefits, but expect to do so in future, put ‘X’ in the box as this may save you having to re-register for Self Assessment.

[TheCyclingProgrammer]

I’m fairly certain you don’t, there’s nothing to report. In fact I’m not sure it lets you submit it wil no income or benefits. The note backs this up. All it means is if you submit a nil return you may get removed from the self assessment system and need to contact HMRC if you have taxable dividends next year.

[mudskipper]

A timely article - not quite the same as the OP's question, but useful for some.

HMRC changes guidance for directors’ returns | AccountingWEB

[TheCyclingProgrammer]

A timely article - not quite the same as the OP's question, but useful for some.

HMRC changes guidance for directors’ returns | AccountingWEB

Finally.

[dagenheis]

I’m fairly certain you don’t, there’s nothing to report. In fact I’m not sure it lets you submit it wil no income or benefits. The note backs this up. All it means is if you submit a nil return you may get removed from the self assessment system and need to contact HMRC if you have taxable dividends next year.

I am able to save employment page with no income or benefits. Cheers for the article, there is another Tribunal case reported with the same conclusion. It will certainly save some time next year.

So in this particular cases, there is a reasonable basis (TR notes below) to establish that we don't need to submit an employment page as there are no salary or benefits paid to the company director. Although the TR uses the term "income" I assume it is same as salary/benefits/expenses as dividends are covered separately. Perhaps I should at least add a note that "XYZ is company director of the ABC Ltd but there are no wages/benefits paid to the director"

Option 2 is to submit the company director employment page with zero income and benefits.

Yes/No - preferred option?


==================
The TR form":
Were you an employee, director, office holder or agency worker in the year to 5 April 2018? Please read the notes before answering. Fill in a separate ‘Employment’ page for each employment, directorship and so on. On each ‘Employment’ page you complete, enter any other payments, expenses or benefits related to that employment. Say how many ‘Employment’ pages you are completing in

Both the TR sa150 notes and sa102 employment page notes read.

Fill in the ‘Employment’ page if you:
• work for an employer who deducts tax
through PAYE
• received income as a company director

[Craig@Clarity]

Hi,

Do we need to fill in the Self Assessment Tax return employment page for being a Ltd company director if there was no salary or benefit paid to the director ? The company does not operate PAYE. Moreover, dividend payment is within dividend allowance which are reported on a separate page anyway.

It does not take much time to fill a blank employment page with the option "if you were a Company director" checked (X). But just wanted to do a sanity check as the notes below sort of suggest the employment page is not required for Company Director if there is no income but they may deregister for SATR which is really not an issue in this instance.


Appreciate your thoughts. Cheers!

N.B:
The 2018 sa102-notes for employment page reads
"Box 6 If you were a company director Put ‘X’ in the box if you received income orbenefits as a company director. If you were a
company director and didn’t receive any income or benefits, but expect to do so in future, put ‘X’ in the box as this may save you having to re-register for Self Assessment.

You don't need to complete the employment page if you don't have a PAYE scheme in place. Moreover, if your total income is less than £50k and divi's is less than £10k and you have no other income (capital gains, property etc), then you don't need to do a tax return at all (obviously tell Hector to note it on his file so they don't expect one from you and fine you for late filing) regardless of if you're a director.

[dagenheis]

You don't need to complete the employment page if you don't have a PAYE scheme in place. Moreover, if your total income is less than £50k and divi's is less than £10k and you have no other income (capital gains, property etc), then you don't need to do a tax return at all (obviously tell Hector to note it on his file so they don't expect one from you and fine you for late filing) regardless of if you're a director.

Cheers Craig - understood about the employment page as there is no PAYE active. But not sure about the basis of what you have mentioned about £50k and divi less than £10k? Reading through the article shared above, wouldn't it be simpler to say instead that there is no need to submit SATR if there is no taxable income during the year unless I have missed a fine point in your assertionyour response is based on someother TR guidelines?


If divi is less than £10k (but higher than divi allowance of 5k in 2017/18) then there is basic rate divi tax payable. So there is a need to file SATR.

[Craig@Clarity]

Cheers Craig - understood about the employment page as there is no PAYE active. But not sure about the basis of what you have mentioned about £50k and divi less than £10k? Reading through the article shared above, wouldn't it be simpler to say instead that there is no need to submit SATR if there is no taxable income during the year unless I have missed a fine point in your assertionyour response is based on someother TR guidelines?


If divi is less than £10k (but higher than divi allowance of 5k in 2017/18) then there is basic rate divi tax payable. So there is a need to file SATR.

Of course you're right. I was just outlining as I assumed it is generally known that if you have taxable income, a tax return must be submitted. If you have divi's above the dividend allowance and over and above used personal tax allowance then, again, a tax return must be submitted. However, if there was a scenario where the only income was £9k worth of dividends and zero salary, even though the £9k dividends exceeds the allowance, there is no tax to pay due to unused personal allowances.

[TheCyclingProgrammer]

If divi is less than £10k (but higher than divi allowance of 5k in 2017/18) then there is basic rate divi tax payable. So there is a need to file SATR.

I could be wrong, but I believe the "£10k or more dividends" figure w.r.t needing to submit a tax return comes from HMRC's guidance and the level at which they can collect unpaid tax through your tax code. IOW, if you have £5k of dividends, with £3k of those taxable, because it's under the £10k threshold you may be able to have your tax code adjusted instead if you don't already submit a tax return.