How soon to take all profits as dividends

[Platypus]

How's this for a good reason...

Yeah yeah, apart from that I mean !!!

Very drole

[northernladuk]

Yeah yeah, apart from that I mean !!!

Very drole

What other reason do you need? If you keep the warchest in the bank you may have the chance to withdraw it at 10% if you ever shut the company down on top of withdrawing divis.

[psychocandy]

Must admit I dont see why you'd ever not use all your 42K allowance? Surely the best bet is to use this up as much as possible and bung it in an ISA/savings account.

Not sure if taking more out is the best idea unless you really need the money. Of course, best bet if personal situation allows is to pay 50/50 with the mrs so you both get to use the tax allowance.

Failing that anything over that might as well either bung in pension or leave there for the time being.

So NLUK - what do you do? Leave as much in company as possible? i.e thats your warchest rather than your own savings? Whats the advantage in that?

I know personal savings rates are crap but they're better than business ones...

[yetanotherbob]

That's what I meant. I can't think of too many other reasons why a director would leave shareholders funds sitting dormant earning little or no interest unless of course they had a strategy for deploying capital for productive use.

I sort of thought of putting it in high interest funds abroad (~9-10% p.a.) - of course, all the profits/interest then get repatriated back to the company in the UK, then I can plan all the personal tax implications later.
Has anyone tried this sort of thing?

[northernladuk]

I sort of thought of putting it in high interest funds abroad (~9-10% p.a.) - of course, all the profits/interest then get repatriated back to the company in the UK, then I can plan all the personal tax implications later.
Has anyone tried this sort of thing?

Have you put any thought in to this at all?

[rambaugh]

I sort of thought of putting it in high interest funds abroad (~9-10% p.a.) - of course, all the profits/interest then get repatriated back to the company in the UK, then I can plan all the personal tax implications later.
Has anyone tried this sort of thing?

I do see several issues with the strategy. The main financial one is the risk of adverse currency movements. Secondly, one would have to pay the pesky fx agent commissions on conversions when repatriating / sending funds back and forth. Also, when some percentage of the company's income is derived from investments HMRC may consider you an investment company and charge higher corporation tax - this is potentially a non / minor issue. Having said all that, I don't see why its not feasible. It would seek an accountants opninion if you we're serious.

Good to see some discussion on ideas other than simply leaving funds in a "warchest" which inevitablely exposes funds to inflation risk / negative compound effect.