Hi,
Hope you all are well.
I have been contracting for many years and have been taking salary and dividends. I also invest in SIPP every year but still got a surplus cash left. I used to have Business Savings accounts but inflation being jumped to ~10%, the 1 to 2 % savings rate is not going to save it.
I have been thinking of investing that surplus cash for a while and now seems to be the time to act on it.
This is what I have done so far.
Thanks.
Hope you all are well.
I have been contracting for many years and have been taking salary and dividends. I also invest in SIPP every year but still got a surplus cash left. I used to have Business Savings accounts but inflation being jumped to ~10%, the 1 to 2 % savings rate is not going to save it.
I have been thinking of investing that surplus cash for a while and now seems to be the time to act on it.
This is what I have done so far.
- Spoke to my accountant regarding investing this money. He advised not to invest more than 10% of cash in the name of my main trading company (used for contracting). His suggestion was to open a dedicated investment company as it will have an appropriate SIC for stock investments, open a new bank account and set up a commercial loan agreement between two companies
- He also advised that they cannot manage a Ltd Company doing stock investments so asked to get another accountant for this
- I got another accountant to do the yearly submission only, opened another limited company for Stock Investments and opened a new business bank account with cashplus bank.
- Has anyone done any stock investments in the name of their trading limited company? If so, would be great if you share some insight please? (e.g. which broker/platform, what %age of company cash was/is invested etc.)
- How to decide the commercial loan interest rate? could it 0% considering I own both the companies? Searched options related to commercial loan interest rates and realized that my trading company will have to pay 20% income tax on the interest received so want to check if it can be avoided somehow. (On a loan of £200,000 and with a 5% interest, I would have to pay £2000 to the taxman.)
- Any other suggestions on stock investing via a limited company?
Thanks.
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