PAYE & Damages - Tax Free Payment

[Old Greg]

Get an accountant for gods sake.

Where's the fun in that?

[northernladuk]

Where's the fun in that?

The fun would be the end of these stupid questions to complete strangers on a free board that this guy seems to think is a responsible way to run his business.

[Old Greg]

The fun would be the end of these stupid questions to complete strangers on a free board that this guy seems to think is a responsible way to run his business.

So don't you want him to pay himself in full, not pay tax and then assume it's ok?

[Podgy]

It is only damages if a court actually awards it as such. Otherwise it can only be 'payment in lieu of somethingorother'. I suspect the consultant is actually you aka the director and no doubt shareholder. You can deem it a sandwich allowance but it wouldn't make it so. HMRC will deem it payment unless you can satisfactorily show otherwise. I hate that word 'deemed' but that is what it is!

Seems to me even after all the good advice here which amounts to get an accountant, you are still going to pay it as 'damages'. At the end of the year, if your accountant is any good, they will question that fact and disallow it. You will then end up with an unpleasant bill. You really should listen to what is being said here.

Another thing, it appears that this event has transcended an end of tax period (corporate year). If so, and the revenue was at risk, you are likely to have made provision for it as a bad debt for which you will have already claimed some tax relief (if your acct is switched on). Now you have recieved the payment, it should be taken from provisions back to revenue and will again be subject to CT as others have already pointed out.

It was not listed as a bad debt as no invoice was raised to ClientCo - at that stage there was no guarantee of getting the £'s & no timesheet for work - it was a dispute/breach rather than bad debt for work done.

I like the idea of a large sandwich allowance tho - & could justify being so podgy.

[Clare@InTouch]

So don't you want him to pay himself in full, not pay tax and then assume it's ok?

You're wicked

[northernladuk]

It was not listed as a bad debt as no invoice was raised to ClientCo - at that stage there was no guarantee of getting the £'s & no timesheet for work - it was a dispute/breach rather than bad debt for work done.

I like the idea of a large sandwich allowance tho - & could justify being so podgy.

I do a knuckle sandwich allowance.......

[Old Greg]

You're wicked

It sounds fine to me and I'm not even an accountant.

[SimonMac]

As the basis of your argument seems to be restating the original question despite it being answered several times I assume you are just looking for a


"Yes you can do what you want" answer. If that's so then yes you can do what you want.

[Podgy]

It sounds fine to me and I'm not even an accountant.

Yeaaa - I dont know why its so wrong - and who'd know.

Some people are just so picky.

[Old Greg]

Yeaaa - I dont know why its so wrong - and who'd know.

Some people are just so picky.

Exactly. Get in there.