Originally posted by spoovy
View Post
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Leaving cash in ltd business long term
Collapse
X
-
-
Originally posted by spoovy View PostThanks for the reply. So what's the savvy way to do it?
If you're going to keep drawing funds out as dividend, you'll need to make sure you have retained profit to keep them legal. If the company is making a loss due to no revenue but ongoing costs (see insurance above, etc) then you'll want to claim a CT rebate.Comment
-
Originally posted by ladymuck View PostI'd keep the professional indemnity insurance for a year after your last contract ends, just in case. If you have any niggling doubts over the IR35 status of any of your contracts, you may want to keep investigation cover in place as queries can come in 6 years later and HMRC can go back further if they smell a rat.Comment
-
Originally posted by spoovy View PostThanks, I was thinking of keeping the IR35 insurance, but I hadn't considered PI. I will keep that too.
And inflation hasn't been considered.
You say long term? But long term for this is madness. Maybe 2/3 years at the most.
Perhaps it's best just to take the money and stick it into a savings fund/offset/gold.See You Next TuesdayComment
-
Originally posted by Lance View Postwith those fees, and any accountancy needed you're getting into a 4 figure sum annually. This is at least 2% (and growing as the value decreases). This is a very high fee to pay if you compare against a management fee for an investment. And this isn't going to grow.
And inflation hasn't been considered.
You say long term? But long term for this is madness. Maybe 2/3 years at the most.
Perhaps it's best just to take the money and stick it into a savings fund/offset/gold.
* Take it out, pay 5k upfront. 45k remains. At 2% pa from offset/investment whatever: after 3 years approx 47,500k.
* Leave it in. 50k - ~1k pa in costs over 3 years = 47k.
So definitely not worth it if timeframe over 3 years. Less than 3 years it might be, but there's not much in it.
Meh, I think I'll just close up shop.Comment
-
Originally posted by spoovy View PostThanks for the reply. I was thinking of dropping the accountant and insurance policies straight away, as there will likely be no turnover while I'm a permie and I've timed the switchover to end neatly with this tax year. If I did lose the permie role I'd get them back again pronto of course. I'll look into the other costs as you suggest. Ta.
So definitely not worth it if timeframe over 3 years. Less than 3 years it might be, but there's not much in it.
Meh, I think I'll just close up shop.'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
-
Originally posted by spoovy View PostWell I'd be paying 5k up front if I close the business in ER. So I either (Very rough figures obviously and yep not factoring inflation):
* Take it out, pay 5k upfront. 45k remains. At 2% pa from offset/investment whatever: after 3 years approx 47,500k.
* Leave it in. 50k - ~1k pa in costs over 3 years = 47k.
So definitely not worth it if timeframe over 3 years. Less than 3 years it might be, but there's not much in it.
Meh, I think I'll just close up shop.
£50k in co
allowed £12k before CGT kicks in.
10% of the remainder is £3800 in CGT. But you still need to pay for the insolvency.
Stop doing back of a fag packet numbers. You cannot make a proper comparison like this.See You Next TuesdayComment
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Comment