MVL, then Brolly question....

[Maslins]

especially if you go through an MVL that boasts "Start your solvent liquidation to benefit from capital gains tax breaks today!" on their home page

Precisely!

I guess the other bit that's unclear is whether the question is asking if tax is a main motivator in you closing the business, or you choosing to liquidate.

If the latter, then it'd be virtually impossible to argue no, as you could strike off much cheaper, but without the tax perks.

If the former, then it's down to whether you can argue the permie job offer was so awesome and that's why you quit, rather than you had lots of cash that you wanted out tax efficiently, and took a permie role despite realistically wanting to continue contracting as you were scared of losing the tax breaks.

[pr1]

Yup, that's what I heard...but then he also said if you closed a Ltd Co to take on a permanent role you'd probably avoid being caught because tax wouldn't be the main motivation for closing. I stressed to him I wasn't happy with that because the consultation uses the phrase "arrangements have a main purpose, or one of the main purposes, of obtaining a tax advantage." There may of course be many reasons why someone's closing, but if they're getting cash out at ~10% tax, I can imagine it'll be very easy for HMRC to argue tax was one of the main purposes.

especially if you go through an MVL that boasts "Start your solvent liquidation to benefit from capital gains tax breaks today!" on their home page

[LisaContractorUmbrella]

For what it's worth, I think going brolly is a great idea

[Maslins]

That's the point. They live for vague, and you won't know until it's tested, but the guy leading the consultation at HMRC appears to be of the opinion that an employment would qualify as "activity", and the legislation would apply, subject to the other conditions being met.

Yup, that's what I heard...but then he also said if you closed a Ltd Co to take on a permanent role you'd probably avoid being caught because tax wouldn't be the main motivation for closing. I stressed to him I wasn't happy with that because the consultation uses the phrase "arrangements have a main purpose, or one of the main purposes, of obtaining a tax advantage." There may of course be many reasons why someone's closing, but if they're getting cash out at ~10% tax, I can imagine it'll be very easy for HMRC to argue tax was one of the main purposes.

[jamesbrown]

Perhaps prudent, bit wholly tho!

That's the point. They live for vague, and you won't know until it's tested, but the guy leading the consultation at HMRC appears to be of the opinion that an employment would qualify as "activity", and the legislation would apply, subject to the other conditions being met.

[stek]

As things stand, even an employee working in the same area could be regarded as caught by the new 2yr rule, since it refers to a "similar trade or activity". Until that is clarified, I wouldn't bother.

Perhaps prudent, bit wholly tho!

[jamesbrown]

I know mate, that's why I asked, seems to make a lot of sense for my situation - will contact the MVL guys on here tomorrow I think...

Cheers!

As things stand, even an employee working in the same area could be regarded as caught by the new 2yr rule, since it refers to a "similar trade or activity". Until that is clarified, I wouldn't bother.

[northernladuk]

Not a good idea... Particularly with the changes coming up and HMRC watching a raft of MVLs being rushed through and wonder if any of them are actually for a genuine business reason.

http://forums.contractoruk.com/accou...ng-ltd-co.html

[stek]

You need to be MVL'ing soon as changes are mooted for the budget. Regards the brolly, well, you'd be their employee, so I do not see a problem.

I know mate, that's why I asked, seems to make a lot of sense for my situation - will contact the MVL guys on here tomorrow I think...

Cheers!

[Fred Bloggs]

You need to be MVL'ing soon as changes are mooted for the budget. Regards the brolly, well, you'd be their employee, so I do not see a problem.

[stek]

Just a thought...

As I have no T/S etc expenses hardly at the moment, working 4 miles from home, and in view of the Div tax etc, is it worth me MVL'ing, I have a fair warchest, going brolly after that, reassigning contract etc?

Obvs I can't ask my accountant as I would effectively be sacking him....

I ask cos I am company-wise fairly rich and personally fukn skint at most effective sal/div drawings and with three kids at uni, etc....