Buying a Property question

[seeourbee]

Because I don't do this sort of advice for a living.

Thanks for all the sensible replies though.

[SueEllen]

Because I don't do this sort of advice for a living.

Thanks for all the sensible replies though.

Then maybe you should talk to one of your friends' who does.

Though their advise will be worth what you paid for it.

[kaiser78]

Hi,

So I have a large amount of cash sat in my limited company (I am a contractor). I would like to buy a small property and use this as the deposit. If I withdraw the lump sum as a dividend I will incur income tax at 32.5% on my person (net 22.5%). So can I then use the the company's cash to make the deposit directly, i.e. the company becomes part owner of the property ? That's not the activities of the company of course, so it is ok ?
Secondly, what about making a non-interest bearing Directors loan account for the same amount to my person. My person then uses this as a deposit for the property as normal.
Any advice welcomed ! Thanks

Thanks.

I'm a qualified accountant, so wont be messing up.

However I'm just exploring what's the most efficient way to do this. Directors loans do not sound the way forward. And it looks like there are more reliefs and allowances available to Individuals rather than companies, despite the company being cash rich.

This is confusing/worrying - aren't these basic accounting principles that are being raised here, whereas even though you may not be a specialist contractor accountant, any field of accounting should be versed with these principles ?

[seeourbee]

You know what, forget it.

I asked a question here as I thought I'd get some professional respectable answers and advice. Instead I get a load of IT geeks who have nothing better to do than troll the internet as they don't have any lives themselves to be getting on with.

Forget it.

[stek]

Thanks.

I'm a qualified accountant, so wont be messing up.

However I'm just exploring what's the most efficient way to do this. Directors loans do not sound the way forward. And it looks like there are more reliefs and allowances available to Individuals rather than companies, despite the company being cash rich.

Chartered, Certified or Cost?

[Scruff]

That was a quick Flounce? I'm quite happy to be an IT Geek, who also happens to be a Beancounter... In a previous life of course. I'm not a Troll, however, since they live under bridges in Norway.

[PerfectStorm]

Am I reading right, that if you've maxed out this year's dividends but still need to take a large sum out for a deposit, is it best to take it out before April or always defer?

[northernladuk]

You know what, forget it.

I asked a question here as I thought I'd get some professional respectable answers and advice. Instead I get a load of IT geeks who have nothing better to do than troll the internet as they don't have any lives themselves to be getting on with.

Forget it.

To be fair you did get some respectable advice, maybe not all of it but some

[mudskipper]

You posted your question on Saturday morning. If you hang around, you might get some sensible answers when the proper accountants get back to work in the morning.

[No2politics]

You can take a director's loan and pay 3% interest to your Ltd to avoid BIK. Buy the property in your personal name. Then repay the loan with rental income or an equity release (if you're adding value to the property. You can only release equity after 6 months ownership) or with dividends taken out (if planned carefully) at basic rate tax level this FY and next FY.

Note that director's loan has to be re-paid within a very strict timeframe, else you are liable to 25% tax on the loan amount.

See https://www.gov.uk/directors-loans/y...-company-money.

BTW I have done this.

EDIT: with Osbourne's tax rape on individual BTL owners, you might want to research buying the property entirely under the company name. This is more for future-proofing under a more efficient tax shelter, but depends on your long term plan with regards to property.

So you buy the property personaly using a directors loan. What happens after 9 months after company year end when u need to pay it back and your money is locked away?