Minimum Salary as Director to receive EV benefit

[cojak]

The answers are here, just read it again.

Thread closed.

[northernladuk]

Just for the record, I have done contracting for a decade previously and have tried several small and big accountants. Many a times, I have received conflicting advise from accountants so I prefer to do my own research before I take a step in any direction. I myself is an accountant (not practising accountant though) so I always try to do my own research.

Just read this again. The awful English and claiming you are an account but asking the most ridiculous questions without doing even the most basic research.

How inneresting.

[northernladuk]

You really are flailing in the dark and messing with things you don't have a clue about. I'll answer one point, the rest you really need to go and get professional help.

You need a contract of employment to be an employee.

Now go find a decent accountant.

[MollyDolly]

That doesn't make you an employee. An office holder can also be paid like that. If you were an employee you'd be subject to minimum wage laws and couldn't do the min wage as efficiently. If you are going to mess with tax at this level you really need to know what you are better.

This is precisely the reason I asked the query. I know that as an employee, minimum wage applies.
I wanted to know if I can get the EV on business without paying minimum wage to myself?

[malvolio]

Precisely.

You might not like the answer, of course, but it is the answer.

[northernladuk]

I am director as well as employee of the business. I have payroll running every month for me and getting very minimum salary from business.

Is a director eligible for EV benefit with just 2% BIK (in which case I do not have to worry about being an employee) ?

That doesn't make you an employee. An office holder can also be paid like that. If you were an employee you'd be subject to minimum wage laws and couldn't do the min wage as efficiently. If you are going to mess with tax at this level you really need to know what you are better.

[MollyDolly]

Read my first post in the thread. You aren't an employee. Given that, your question remains a non starter.

HTH...

I am director as well as employee of the business. I have payroll running every month for me and getting very minimum salary from business.

Is a director eligible for EV benefit with just 2% BIK (in which case I do not have to worry about being an employee) ?

[malvolio]

Read my first post in the thread. You aren't an employee. Given that, your question remains a non starter.

HTH...

[MollyDolly]

So you have an accountant, you have been a contractor, you understand accountancy and have asked previously about related matters and got answers, and yet you are asking a very dumb question to which the answer is blindingly obvious and apparently haven't worked out that YourCo income and your income are two unrelated things??

Something that is dumb for one person may not be dumb for others. I am here to get information. You do not have to be a bully to answer to a Newbie. Instead of ranting, you could have just provided clear answer (if you knew) or stay away from post (as you felt your time was wasted). I would have appreciated no abuse here.

In one line - if you are working through your own Ltd Co what it earns and how it is utilised is up to you as the director, getting an EV (or any other business purchase) is not related to salary in any way,

I am checking for company car given to employees like many companies allow. I may be mixing up two things here (if I knew it clearly, I would be perhaps not asking on this forum) - Company Car benefit that companies offer to employees v/s car bought by business that can be used by employees with 2% BIK (are these 2 same thing)?


Bottom line is - I want to get an EV from my own limited company where I pay 2% BIK but cost of the car is borne by my limited company.

[malvolio]

I already have an accountant and he has recommended minimum salary per month like £100 a month. I am trying to find out if his advise is correct.
Just for the record, I have done contracting for a decade previously and have tried several small and big accountants. Many a times, I have received conflicting advise from accountants so I prefer to do my own research before I take a step in any direction. I myself is an accountant (not practising accountant though) so I always try to do my own research.

On NLUK's point - why am I asking bunch of contractors - because I have got references in past on this forum that I could research further to get correct information. One professional accountant may have just one type of experience but several contractors working with several accountants bring different type of experience on this forum else no one need to come to this forum as they all can just ask professional accountants.
If you could point me in the right direction, it is highly appreciated.

So you have an accountant, you have been a contractor, you understand accountancy and have asked previously about related matters and got answers, and yet you are asking a very dumb question to which the answer is blindingly obvious and apparently haven't worked out that YourCo income and your income are two unrelated things??

In one line - if you are working through your own Ltd Co what it earns and how it is utilised is up to you as the director, getting an EV (or any other business purchase) is not related to salary in any way, and the answer to the question you now are asking is all to do with taxation bands and how they are utilised which are published on the HMRC website in some detail but the precise answer depends on your own specific taxation position.

Now stop wasting our time.

[MollyDolly]

More to the point, you are not an employee in the first place. To become one means some proper paperwork and a lot of other restrictions on what you can do.

So before trying to run (figuratively and literally), try to understand what the terms "Director", "Salary", "Officer of the Company" and the rest mean to a contractor. Just as a starter, if you assume YourCo is there to save you money and taxes, it isn't.

And NLUK is right, get an accountant first before you really cock it up.

I already have an accountant and he has recommended minimum salary per month like £100 a month. I am trying to find out if his advise is correct.
Just for the record, I have done contracting for a decade previously and have tried several small and big accountants. Many a times, I have received conflicting advise from accountants so I prefer to do my own research before I take a step in any direction. I myself is an accountant (not practising accountant though) so I always try to do my own research.

On NLUK's point - why am I asking bunch of contractors - because I have got references in past on this forum that I could research further to get correct information. One professional accountant may have just one type of experience but several contractors working with several accountants bring different type of experience on this forum else no one need to come to this forum as they all can just ask professional accountants.
If you could point me in the right direction, it is highly appreciated.

[malvolio]

More to the point, you are not an employee in the first place. To become one means some proper paperwork and a lot of other restrictions on what you can do.

So before trying to run (figuratively and literally), try to understand what the terms "Director", "Salary", "Officer of the Company" and the rest mean to a contractor. Just as a starter, if you assume YourCo is there to save you money and taxes, it isn't.

And NLUK is right, get an accountant first before you really cock it up.

[northernladuk]

Why don't you get an accountant and do it properly rather than ask a bunch of contractors?

[MollyDolly]

Hi,
I have just started a new business. I am director of my limited company. I am planning to buy an EV using business.
Do I need to pay myself national minimum wage for me to be classed as employee of the business and then take the EV benefit?
Can I take EV benefit as director of the business (not as an employee)?

I am reading online that for you to be classed as employee, national minimum wage must be paid.
If I need to pay national minimum wage then I am looking at more than £300 per week (30*10.42) and more than £15K per year.
Are my assumption correct?

I do not want to take any salary from business, if I do not have to but want to ensure that my EV purchase in business is not challenged by HMRC in coming years.

So my question is - can I buy an EV as company director while I receive just £100 per month salary from business? I have other source of income so do not need anything from business at this stage.

Thanks