Gains made using Directors Loan

[eek]

I'm trying to go down the most tax efficient route. Can you share the other options please?

For what - putting money into crypto or getting the money out?

[jamesbrown]

Worried that the crypto trading would affect ER

Investing won't affect ER/BADR because that is a personal tax relief, which is applied for via your SATR. It may well affect your ability to achieve a capital treatment in the first place, however, if your company is classified as a Close Investment Holding Company (CIHC). Quite apart from this, it's generally a bad idea to invest via your company because you don't get the favorable tax treatment of investing as an individual, such as via ISAs or by leveraging the annual CGT allowance. Quite apart from that, you're proposing to invest in cryptowafffles.

[ryan11]

For what - putting money into crypto or getting the money out?

Both I guess, you mentioned "If you're looking at a company tax avoidance manoeuvre, there are better options." So just wondering what they may be?

[eek]

Both I guess, you mentioned "If you're looking at a company tax avoidance manoeuvre, there are better options." So just wondering what they may be?

That wasn't me - my viewpoint is pay the tax HMRC think is due otherwise expect a world of pain in ways and places you couldn't imagine.

[BR14]

Is it actually possible to cash out any significant amount from crypto? it's easy to buy it, but AFAICS, Extremely difficult to cash it.

[ryan11]

cryptowafffles.

Nice, never heard that term before :-D I guess it wouldn't necessarily have to be crypto, it could be investment in Stock or a portfolio (via eToro for example). Either way I'm just trying to get an idea of the whole company vs personal investment side of it and getting some additional value from the retained earnings (*whilst waiting on accountant's response of course :-0) )

[ryan11]

That wasn't me - my viewpoint is pay the tax HMRC think is due otherwise expect a world of pain in ways and places you couldn't imagine.

ah my bad! Oh I wouldn't dream of it haha, last thing I want to do is get on the wrong side of them. I guess it was more of a question of: given that I have a good chunk of retained earnings, and any additional dividend would attract the top income tax %, would it be most tax efficient to go down the DL route and take advantage of CGT allowance etc or make the investments through my co (or via another co with a loan etc)

I've had some good responses so far anyways so thanks everyone for your input

[ryan11]

Is it actually possible to cash out any significant amount from crypto? it's easy to buy it, but AFAICS, Extremely difficult to cash it.

It depends on the crypto. If it's one of these "meme coins" or "sh*t coins" as they are often referred to, then yes I can be difficult to get money back out as many are "rug pulls" or have very poor liquidity, and usually always end in disaster.

Wouldn't be touching them!

[jamesbrown]

Nice, never heard that term before :-D I guess it wouldn't necessarily have to be crypto, it could be investment in Stock or a portfolio (via eToro for example). Either way I'm just trying to get an idea of the whole company vs personal investment side of it and getting some additional value from the retained earnings (*whilst waiting on accountant's response of course :-0) )

Yeah, fair enough. I think you're right to worry about your company being classified as a CIHC, assuming you have significant retained funds that you eventually want to extract as a capital distribution. There's some guidance surrounding the fraction of assets invested and the returns from investments relative to trading income, but it needs to be relatively small in both cases. For many reasons, personal investments, whether direct or via pension contributions, are generally a better approach.

[Lance]

It depends on the crypto. If it's one of these "meme coins" or "sh*t coins" as they are often referred to, then yes I can be difficult to get money back out as many are "rug pulls" or have very poor liquidity, and usually always end in disaster.

Wouldn't be touching them!

just convert them to BTC then sell them.... easy peasy.