Originally posted by oilboil
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Previously on "Going Perm - Close Ltd co? what about Company car on HP?"
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Originally posted by GhostofTarbera View PostExplain situation to new employer get them to take over the lease
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It sets a huge precedent - he will have to dispose/purchase the car legally as soon as possible
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Originally posted by bongo77 View PostHi- long time lurker, first time poster.
I have had a Ltd. co for 5 years. Due to the market dying I am moving to a senior perm role with one of the big 4.
I am planning to be perm for at least 3-5 years.
The big 4 firm has requested that I close my company/ make it dormant or use it only to receive payments for work done prior to joining the firm t the end of July
By this time, the Ltd company will have about £50k in the bank, with another £15k in outstanding invoices & £15K corp tax and vat to pay. So effectively about £40k as payable dividends, factoring in salary and expenses between now and end of July.
Normally I would close the company to save accounting fees/ administration over the next 5 years. i realise i could prob negotiate a reduction in accounting fees if the company is dormant.
However- here's a possible complication: The company has a electric car, bought on hire purchase from Tesla, with low or neglible BIK.
Overall agreement is for roughly £60k, of which roughly £39k is still payable in another 39 monthly instalments.
Should I keep the company going to continue the car payments? Is this breaking any rules? or would it be better for the company to sell the car to me?
Clearly I am looking to comply with all accounting rules/ HMRC and my new employer, but I am not clear on the best course of action.
Any advice much appreciated.
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Explain situation to new employer get them to take over the lease
Sent from my iPhone using Contractor UK Forum
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What dogsnads says is true for a personal deal. Those are covered by different legislation.
For a business deal there are different laws. The rules might be the same. Dogsnads can maybe confirm..
However if you’re closing the company then credit records are me among less. And the liability is limited. Talk to your accountant about closing the company and handing the car back. If you can close the company legally and it owes money it’s not your problem.
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Originally posted by bongo77 View PostHi- long time lurker, first time poster.
I have had a Ltd. co for 5 years. Due to the market dying I am moving to a senior perm role with one of the big 4.
I am planning to be perm for at least 3-5 years.
The big 4 firm has requested that I close my company/ make it dormant or use it only to receive payments for work done prior to joining the firm t the end of July
By this time, the Ltd company will have about £50k in the bank, with another £15k in outstanding invoices & £15K corp tax and vat to pay. So effectively about £40k as payable dividends, factoring in salary and expenses between now and end of July.
Normally I would close the company to save accounting fees/ administration over the next 5 years. i realise i could prob negotiate a reduction in accounting fees if the company is dormant.
However- here's a possible complication: The company has a electric car, bought on hire purchase from Tesla, with low or neglible BIK.
Overall agreement is for roughly £60k, of which roughly £39k is still payable in another 39 monthly instalments.
Should I keep the company going to continue the car payments? Is this breaking any rules? or would it be better for the company to sell the car to me?
Clearly I am looking to comply with all accounting rules/ HMRC and my new employer, but I am not clear on the best course of action.
Any advice much appreciated.
This isn't them being a-holes (although they are very capable of that - I know I got good at being one too) - it's a requirement of the Audit licence
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Originally posted by bongo77 View PostHi- long time lurker, first time poster.
I have had a Ltd. co for 5 years. Due to the market dying I am moving to a senior perm role with one of the big 4.
I am planning to be perm for at least 3-5 years.
The big 4 firm has requested that I close my company/ make it dormant or use it only to receive payments for work done prior to joining the firm t the end of July
By this time, the Ltd company will have about £50k in the bank, with another £15k in outstanding invoices & £15K corp tax and vat to pay. So effectively about £40k as payable dividends, factoring in salary and expenses between now and end of July.
Normally I would close the company to save accounting fees/ administration over the next 5 years. i realise i could prob negotiate a reduction in accounting fees if the company is dormant.
However- here's a possible complication: The company has a electric car, bought on hire purchase from Tesla, with low or neglible BIK.
Overall agreement is for roughly £60k, of which roughly £39k is still payable in another 39 monthly instalments.
Should I keep the company going to continue the car payments? Is this breaking any rules? or would it be better for the company to sell the car to me?
Clearly I am looking to comply with all accounting rules/ HMRC and my new employer, but I am not clear on the best course of action.
Any advice much appreciated.
If you have paid over half of the total finance amount, then you can voluntarily terminate the deal legally. if you havent paid back 50% of the finance then you may find it harder handing the car back.
Bear in mind the car market has shifted drastically since the covid 19 outbreak but was tuliping beforehand. In previous years, HP companies may have worked with you even if you havent paid back more than 50% of the finance but may now play hardball because there's a severely restricted market out there with fewer buyers etc.
You wont beable to sell the car to yourself without the finance company's agreement. You need to discuss options with them.
You can keep your co open as long as you want but will need to file returns even if not trading.
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Going Perm - Close Ltd co? what about Company car on HP?
Hi- long time lurker, first time poster.
I have had a Ltd. co for 5 years. Due to the market dying I am moving to a senior perm role with one of the big 4.
I am planning to be perm for at least 3-5 years.
The big 4 firm has requested that I close my company/ make it dormant or use it only to receive payments for work done prior to joining the firm t the end of July
By this time, the Ltd company will have about £50k in the bank, with another £15k in outstanding invoices & £15K corp tax and vat to pay. So effectively about £40k as payable dividends, factoring in salary and expenses between now and end of July.
Normally I would close the company to save accounting fees/ administration over the next 5 years. i realise i could prob negotiate a reduction in accounting fees if the company is dormant.
However- here's a possible complication: The company has a electric car, bought on hire purchase from Tesla, with low or neglible BIK.
Overall agreement is for roughly £60k, of which roughly £39k is still payable in another 39 monthly instalments.
Should I keep the company going to continue the car payments? Is this breaking any rules? or would it be better for the company to sell the car to me?
Clearly I am looking to comply with all accounting rules/ HMRC and my new employer, but I am not clear on the best course of action.
Any advice much appreciated.
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