Is it legal for a shareholder to work through my company?

[Gulliver]

As others have said, there are two different issues, (a) raising invoices for work done - other than vat threshold & liability implications, no real issue (b) paying the C shareholder (dividend? salary? both?).

Alphabet shares can create issues, but I'm not unduly vexed in this circumstance.

(b) paying the C shareholder (dividend? salary? both?). - So which one?

[Jessica@WhiteFieldTax]

(b) paying the C shareholder (dividend? salary? both?). - So which one?

Drop me an email - lets not do your personal stuff in a public forum?

I'll be picking up email over the weekend.

[stek]

Is it me or us there something behind this with a piscean odour?

[malvolio]

Is it me or us there something behind this with a piscean odour?

Maybe. Rather depends on how much the brother paid for his share, doesn't it.

But as was said at the start, this is an S660a fail unless the OP is paying all the tax due on both his dividends and his brother's.

[Jessica@WhiteFieldTax]

Maybe. Rather depends on how much the brother paid for his share, doesn't it.

But as was said at the start, this is an S660a fail unless the OP is paying all the tax due on both his dividends and his brother's.

Separating from advising a client of mine (which I won't do in public) and the general point...

...no, alphabet shares are not an automatic S660a fail. Simplifying an awful lot, they are only a fail if they are bounteous. There are many commercial situations where they address the needs of a company, albeit they need to be set up properly and with advice. Away from advice to PSCs, they've been used for years, and will continue to be. Arctic Systems etc just adds a realm of complexity, as does the Employment Related Security rules, and many other aspects of the tax code.

[Gulliver]

Drop me an email - lets not do your personal stuff in a public forum?

I'll be picking up email over the weekend.

Email sent.

[northernladuk]

I thought there were two issues here, one being the different class and the other being S660?

So two elements of risk with this set up?

[ASB]

I thought there were two issues here, one being the different class and the other being S660?

So two elements of risk with this set up?

Potentially but it depends on tthe fact. There is no more or less risk of s660 issues with different classes of shares or the same class.

However the practice in which different share classes are issuued is such that there is often an element of bounty in them.

So the brother owns some shares. He does some work. It is not unreasonable for him to have an equity interest. Under those circumstances I dont see any bounty. But it could depend on when they were issued. It could also depwnd on why and what if anything was paid for them.