Quick question regarding Tax and Banking

[Maxamus]

Hi There

Do people move Corp Tax and Tax on Salary to savings account or do you leave it in the business account?

Likewise for VAT.....

[ratewhore]

CT I put in a company deposit account until it's due. PAYE and VAT I pay quarterly anyway so it's not worth moving the money around...

[xoggoth]

Rather depends what you mean by savings account. A higher paying deposit account in name of the company is a good idea in theory but if you mean transferring it to something in your own name, anything over £5k may count as a director's loan which is taxable.

I say in theory as I used to have business current and deposit accounts and on various occasions ended up paying bank charges because cheques bounced when I forget to transfer it back.

[Nixon Williams]

Generally it can get messy movings funds about, provided you have a decent account that pays good interest (eg Cater Allen)on the current account this will solve the problem.

We have had a few clients using current and deposit accounts that have gone overdrawn because the forgot to transfer, I say its not worth the bother.

Alan

[Maxamus]

Well i have a business account and a "BMM" account. No idea what the BMM account is. Im with HSBC.

The only reason i ask is because it keeps the business account tidy as your not subtracting corp tax/tax on salary that you have set aside for previous months everytime your working out divident payments for the next month....etc

[malvolio]

Well i have a business account and a "BMM" account. No idea what the BMM account is. Im with HSBC.

The only reason i ask is because it keeps the business account tidy as your not subtracting corp tax/tax on salary that you have set aside for previous months everytime your working out divident payments for the next month....etc

"Business Money Manager" - says it all, really. There aren't any short term high interest accounts these days (BMM is around 4% pa), so this is as good as anything, given that internet banking to do the transfers (instantly, if you need it) is cheap and easy.

Basically I keep working capital to cover the next month's known bills in the current a/c and shovel everything else into the deposit a/c. Add in a small agreed overdraft limit to cover the odd forgetful moment and you're covered.

[Maxamus]

so would it be a good idea to put the corp tax set aside in the "business money manager" account until it is due?

PS. is the business desposit account that you guys are referring to the same as the "BMM"?

[Fishface]

HSBC do useful 'bonds' 1,2,3,6 etc fix periods - returns from 4.2 to 5.6 that are part of the business account.

Pays the accountants fees at the end of the year

[martinb]

"Business Money Manager" - says it all, really. There aren't any short term high interest accounts these days (BMM is around 4% pa), so this is as good as anything, given that internet banking to do the transfers (instantly, if you need it) is cheap and easy.

Basically I keep working capital to cover the next month's known bills in the current a/c and shovel everything else into the deposit a/c. Add in a small agreed overdraft limit to cover the odd forgetful moment and you're covered.

Same here - keep enough in current account to cover the coming month's bills, put everything else into the deposit account (BMM). At the end of each financial year after I have worked out my approx Corp Tax I shove that (rounded up to the nearest £1k) into a 6 month bond so it matures just before the CT is payable.

[Maxamus]

HSBC do useful 'bonds' 1,2,3,6 etc fix periods - returns from 4.2 to 5.6 that are part of the business account.

Pays the accountants fees at the end of the year

got any more info on these?