Profit Share Letters from Glen May LLP
@ITMark - agree that its not worth the paper its written on regards to Glen May and they are covering their backs, however in 2019 HMRC will have the right to request all LLP's in UK and overseas to declare partner overdrawn capital balances and Glen May has just effectively written this down to zero by declaring a profit share. This now means HMRC will be seeking individuals to declare it. My understanding is that with overseas LLP's HMRC's position has been to tackle it with the individual directly via self assessment challenges so I suspect at some point they will be asking us if we have received a profit share or capital payments that have not been paid back to the LLP.
Would be good to know if anyone else has a different view on this.
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Overdrawn Capital Account Scheme (Aston Mae / Glen Mae / Procorre)
Collapse
X
Collapse
-
Originally posted by ITmark View PostYes few people have received it, in my opinion it's not worth the paper it's printed on (Glen May one doesn't even have their address / tel numbers on and they've already been struck off). It's just a bit of rear end covering from them. They also (alike Procorre one - as they are the same people) don't mention any particular tax year. I'd get some professional advice and not take their word as it's biased and solely protecting themselves.
I understand what you are saying regarding not been worth the paper it is written on as Aston Mae, Glen May, Procorre, AML, Burnside etc are all pretty much just con men but what is stopping Glen May sending a copy of the letter to HMRC? Friends of mine have had self assessment anti-avoidance enquiry letters in the past and Glen May replied for them declaring exactly what business development funds were paid from the "overdrawn" capital account so HMRC know how much we have taken over the years....Leave a comment:
-
Originally posted by Smurfburger View PostHi,
In late 2016, I got a letter, from Glen May, stating my profit share, of around £25k, for calendar year 2012. The tax on this amount was declared on my 2016/17 self assessment and paid in January of this year (2018).
Today I have had another letter, from Glen May, stating that this is the penultimate financial accounts for Glen May and showing my profit share of almost £90k!! It seems they have rolled possibly three years accounts into the one profit share and so I will have to pay the tax on this amount by the end of January 2019.
That is a large amount to find.
Has anyone else had a similar letter?
Yes few people have received it, in my opinion it's not worth the paper it's printed on (Glen May one doesn't even have their address / tel numbers on and they've already been struck off). It's just a bit of rear end covering from them. They also (alike Procorre one - as they are the same people) don't mention any particular tax year. I'd get some professional advice and not take their word as it's biased and solely protecting themselves.Leave a comment:
-
Profit Share Letters from Glen May LLP
Hi,
In late 2016, I got a letter, from Glen May, stating my profit share, of around £25k, for calendar year 2012. The tax on this amount was declared on my 2016/17 self assessment and paid in January of this year (2018).
Today I have had another letter, from Glen May, stating that this is the penultimate financial accounts for Glen May and showing my profit share of almost £90k!! It seems they have rolled possibly three years accounts into the one profit share and so I will have to pay the tax on this amount by the end of January 2019.
That is a large amount to find.
Has anyone else had a similar letter?Leave a comment:
-
Originally posted by Telco7676 View Post2. the acquisition sell from procorre is using the entrepreneur relief introduced in 2015 so the valuation would be subject to 10% CGT and they claim this will clear the overdrawn balances and future profit shares.Leave a comment:
-
Overdrawn Capital Account Scheme (Aston Mae / Glen Mae / Procorre)
1. agree that any crediting of overdrawn account will result in income tax via profit share to partner.
2. the acquisition sell from procorre is using the entrepreneur relief introduced in 2015 so the valuation would be subject to 10% CGT and they claim this will clear the overdrawn balances and future profit shares.
Has anyone gone down this route?Leave a comment:
-
Overdrawn Capital accounts. profit shares and Loan Charge 2019
1. Agree that any crediting of overdrawn account will result in a tax liability to the contractor, just like the profit share for 2012 that was declared by Glen May in Oct 2016
2. The Procorre acquisition route is to use the HMRC entrepreneur relief that was introduced in 2015 - pay 10% CGT on the acquisition value and clear the overdrawn account and end the prospect of any future profit shares.
Has anyone gone down this route yet?
https://www.gov.uk/government/public...eneurs-relief-Leave a comment:
-
Originally posted by TroyT View PostHmmm, not too sure about that one. I’m pretty sure they are an overseas registered company, not UK.
Don’t think they would need to do anything with regards to Companies House.
I’ve had communication with them at the end of Jan this year.
Don't think they can dissolve a company that has partners owing money to it (overdrawn capital account balances) unless administrators have concluded that they can't get the money backLeave a comment:
-
Originally posted by Telco7676 View PostMy understanding is that LLP's using the overdrawn capital account scheme are now under pressure to clear these balances down and the only real option left is for them to declare profit shares or apply costs against it, ie an acquisition cost of a LTD company from the contractor
Questions I have and somebody here may have the answers is:
1. Does the 2019 loan charge scheme also loop in overdrawn capital account balances?
2. Has Glen May LLP been dissolved and if so does this mean no further profit shares will be issued? They applied one in 2016 for 2012 accounting year but never heard of one since.
3. Is anyone on here gone down the acquisition route with Procorre? If so would be good to hear your thoughts.
Are there really any profit shares to allocate now? If the LLP did allocate accounting profits (e.g. by crediting an overdrawn capital account), why is that not within the self-employed disguised remuneration rules now? In other words, doing that might create a tax / NIC charge today (we can argue the subtleties of the comparator for "Condition E", but that probably won't help and you'd have to think about the TAAR too).
Similarly, if your limited company is bought from you for a credit to your LLP capital account, how does that stop the current self-employed DR rules applying? Again, you need to consider the TAAR and that the "relevant benefit amount" is not reduced by any consideration you give (i.e. your shares in your limited company).
Either way is the outstanding capital account really repaid with "money"? If not, you'd end up paying tax twice. Once on the new credit to your capital account now, once on the original amount on 5 April 2019.
You'd also want to think about various other bits and pieces (like GAAR). This has a 60% penalty. Whether this could apply will depend on the facts and I have no idea what they are.Leave a comment:
-
Originally posted by Telco7676 View PostJust been reading into this thread.
I was with Aston Mae, Glen May and now Proccore.
My understanding is that LLP's using the overdrawn capital account scheme are now under pressure to clear these balances down and the only real option left is for them to declare profit shares or apply costs against it, ie an acquisition cost of a LTD company from the contractor.
Questions I have and somebody here may have the answers is:
1. Does the 2019 loan charge scheme also loop in overdrawn capital account balances?
2. Has Glen May LLP been dissolved and if so does this mean no further profit shares will be issued? They applied one in 2016 for 2012 accounting year but never heard of one since.
3. Is anyone on here gone down the acquisition route with Procorre? If so would be good to hear your thoughts.
Thanks
2. The Glen May "profit share" is, in my opinion, a paper exercise that is designed to achieve nothing other than protection for those behind Glen May.
3. Deducting the cost of acquiring a Ltd Co as a trading expense? Not a chance. The Procorre structure you should take to a competent adviser and ask some hard questions of.Leave a comment:
Partners
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Leave a comment: