Overpayment from old contract

[SaltyLevels]

Fair enough then.... I can't help feeling you are making yourself visible at HMRC for no advantage if you running the company properly. Your call. Not something I'm comfortable with at all but sounds like you've got all bases covered.

Hopefully one of our experience accountants that post on here will give their opinion.

I look forward to it; as you can tell, not one of my strongest areas. It was literally to compartmentalise the accounts. I'll wait for the advice mentioned, but your reaction has put me ill at ease, if I am being honest.

[SaltyLevels]

I'm trying to work out the advantage of it, unless the OP feels it would shield him from a potential IR35 investigation.

I do tend to take some time off to spend with my kids every couple of years, take the summer off and take off, so tend to use this as an opportunity to clear an old company, then start a new one on our return. I like to be able to put the accounts to bed and start afresh. I also do think it helps in the event of investigation. Again, this is under advice and with full vision of HMRC, whose returned letter is kept safe.

[northernladuk]

I look forward to it; as you can tell, not one of my strongest areas. It was literally to compartmentalise the accounts. I'll wait for the advice mentioned, but your reaction has put me ill at ease, if I am being honest.

I could be wrong (wouldn't be the first time) so wait and see what either some of our other experience posters say or hopefully some of our resident accountants before getting worried. It's just not something I would personally do so wait for some more advice before worrying.

I would suggest looking round for another accountant through, a lot has changed recently and there are some great tools out there. Maybe someone with a portal like Freeagent or even the SJD spreadsheets. I think you need to take a bit more control of your finances and these tools are great for that.

[MrMarkyMark]

I do tend to take some time off to spend with my kids every couple of years, take the summer off and take off, so tend to use this as an opportunity to clear an old company, then start a new one on our return. I like to be able to put the accounts to bed and start afresh. I also do think it helps in the event of investigation. Again, this is under advice and with full vision of HMRC, whose returned letter is kept safe.

I have done similar things, taking up to a year off.

I have never closed the company down though.

[BolshieBastard]

Why is it sharp practice?

Same business. HMRC don't seem to have an issue with it, as I have spoken to them about it. So, please, why do you?

Utter bollocks. Its not a 'sharp practice.' Go see a qualified accountant before shoot off unfounded comments.

If some people dont want to do it, fair enough but the large accountancy practice I use recommended it. Im going to query it again as being worthwhile in a month or so when I go in to see them and if they still recommend it, I'll do it.

If they no longer think it necessary then I wont.

I've never had an issue with HMRC either when past companies have applied to be struck off and new one started. Then again, Im not trying to claim ER to get money out of the company or any other 'dodge.'

[TheFaQQer]

I could be wrong (wouldn't be the first time) so wait and see what either some of our other experience posters say or hopefully some of our resident accountants before getting worried. It's just not something I would personally do so wait for some more advice before worrying.

I would suggest looking round for another accountant through, a lot has changed recently and there are some great tools out there. Maybe someone with a portal like Freeagent or even the SJD spreadsheets. I think you need to take a bit more control of your finances and these tools are great for that.

I see little to no advantage of doing it - the OP and his wife must take everything out as dividends or salary if there is no tax advantage and they aren't claiming ER.

So, one presumes that the warchest is either held personally, or does not exist, which doesn't fit the way that I run my company - but each to their own.

The only benefit I can see is that it might save a couple of months of accountancy fees, but I'd have thought that the additional costs of start up and shut down would make that irrelevant. I can't see it making any impact on an IR35 investigation, because it would be fairly easy to argue that all the companies are just a tax avoidance measure (because they are attempting to avoid any investigation) - which just makes it harder and more complicated if HMRC ever do come calling.

On the assumption that ER still exists and is claimable by a one or two person close company, I'd have thought that it would be better to retain money in the company, build the war chest that way, then claim ER when shutting down for good (or at least long enough to avoid suspicion under TiS) and get the tax advantage that way.

But each to their own, and without knowing the figures, who knows whether one route is better than the other?

[MrMarkyMark]

Utter bollocks. Its not a 'sharp practice.' Go see a qualified accountant before shoot off unfounded comments.
Then again, Im not trying to claim ER to get money out of the company or any other 'dodge.'

Utter fail, please read the rest of the post, before shooting off unfounded comments .

I meant it was sharp practice if he was claiming ER.

Which it is.

[SaltyLevels]

Utter fail, please read the rest of the post, before shooting off unfounded comments .

I meant it was sharp practice if he was claiming ER.

Which it is.

Without wanting to stir a pot, your post never mentioned ER, Northern lads one did. It's also not sharp practice then, if you have a significant period between shutting down and starting again, which 6 months could be construed as.

Anyway, it's moot, that's the advice I was given, advice I took up with HMRC who seemed not to have any issues.

Some of my companies have been me trading alone, some with my wife, so there's always a difference, even if it's not been intended to be so.

As long as you're operating, trading properly, I genuinely can't see the issue here.

But next time, I will be taking ER as I'll be off for 6 months.

[MrMarkyMark]

Without wanting to stir a pot, your post never mentioned ER, Northern lads one did. It's also not sharp practice then, if you have a significant period between shutting down .

Which is why I said read the rest of the post.

I deleted my post concerning it, after you said you weren't claiming ER.
Point is I know of people who do close them on a regular basis and claim ER.

Removed post, as it was irrelevant given this response.

[SaltyLevels]

Which is why I said read the rest of the post.

I deleted my post concerning it, after you said you weren't claiming ER.
Point is I know of people who do close them on a regular basis and claim ER.

Without being funny, its kind of tricky reading posts that have been deleted. But I get the drift. I will be doing that in June, but for the right reasons from what I can see.

Apologies if I've been moody. Thanks for the responses.