Reply to: 30 day notice saving account recommendations?

[Jog On]

I've decided to do this:

CT - high interest business savings account
VAT - Funding circle (P2P business lending network)

This way the CT account won't take an interest hit when making VAT payments. Not going to mess around with director's loans etc, business money lives in business accounts and works towards maintaining a financially healthy business with a growing balance sheet. Just my view.

Surplus cash is another matter and the subject of gazillion other threads. Suffice it to say building the balance sheet is the order of the day. If investment/trading income surpasses contracting income and I get classed as a CIHC then I'll be a very happy man (I mean LTDco!)

[JamJarST]

Take the money put aside for CT/VAT as a director's loan, make sure you pay it back with 4% interest before 9 months after the company year end (you will need the money back in the account to pay the CT by then anyway) and you're sorted. Simples.

Don't forget to reduce your dividends accordingly so that the interets received in your personal savings account doesn't inadvertantly push you into the higher rate tax band!

[Wanderer]

I am with on this one and we are all in the same boat. I rack my brains on ways to make this work but until someone tries PUMA's option of using a trust and it passes the test I am stumped.

Take the money put aside for CT/VAT as a director's loan, make sure you pay it back with 4% interest before 9 months after the company year end (you will need the money back in the account to pay the CT by then anyway) and you're sorted. Simples.

[northernladuk]

Just thinking out loud that it might have been able to work as a director loan or something as I have all this money sat in a bank account doing sod all and derised to pay Hector early for the pittance interest they will pay.

I am with on this one and we are all in the same boat. I rack my brains on ways to make this work but until someone tries PUMA's option of using a trust and it passes the test I am stumped.

[SimonMac]

I can't see how this will be allowed. You cannot divi out money as it is not profit so how would you get it out of the company and document it? Once it is in your mortgage it cannot be Company money so would leave you open to problems on top of BIK issues. At that point the company does not have the money to pay it's CT. Not somewhere I am sure you want to go. As it accrues monthly this isn't a big amount over the year anyway is it?

Just thinking out loud that it might have been able to work as a director loan or something as I have all this money sat in a bank account doing sod all and derised to pay Hector early for the pittance interest they will pay.

[Jog On]

Think I'll stick with a high interest savings account for the CT and keep the VAT in the current account so I don't5 get penalised for drawing it out every quarter.

For surplus cash/warchest I like the lending idea but not to individuals - businesses on the other hand...:

Funding Circle

I think this will sit nicely on my income statement/balance sheet and help UKPLC as well - we're all in this together after all :d

[JamJarST]

I can't see how this will be allowed. You cannot divi out money as it is not profit so how would you get it out of the company and document it? Once it is in your mortgage it cannot be Company money so would leave you open to problems on top of BIK issues. At that point the company does not have the money to pay it's CT. Not somewhere I am sure you want to go. As it accrues monthly this isn't a big amount over the year anyway is it?

Pretty sure from an accounting perspective this is allowed but it would have to be a loan and not a divi, because as you said that has to come out of profit after tax. On the balance sheet you would have a liabilty for CT and an asset for the director's loan. Of course the loan would attract BIK or would need an interest charge of 4% (assuming over £5k) and that would probably wipe out a lot of the interest earned or saved on the mortgage or in a savings account.

[northernladuk]

What is the "legality" of drawing out my CT money (which is sat in a next to zero interest savings account) sticking it in my off set mortgage account and then paying my CT direct from my personal account when its due?

I can't see how this will be allowed. You cannot divi out money as it is not profit so how would you get it out of the company and document it? Once it is in your mortgage it cannot be Company money so would leave you open to problems on top of BIK issues. At that point the company does not have the money to pay it's CT. Not somewhere I am sure you want to go. As it accrues monthly this isn't a big amount over the year anyway is it?

[jamesbrown]

I assume the website takes the cut between the Lending rate (4%) and the Borrow Rate (7.9%), nice little earner no wonder the Banks are raking it in.

So long as the recovered defaults remain low.

[MarillionFan]

Treated as a directors loan with all associated rules shirley?

I would assume if they can take 'business money' then it's got nothing to do with a directors loan.

[jmo21]

What is the "legality" of drawing out my CT money (which is sat in a next to zero interest savings account) sticking it in my off set mortgage account and then paying my CT direct from my personal account when its due?

Treated as a directors loan with all associated rules shirley?

[Contreras]

You mentioned the Moneyfacts search engine already and there is one more that I know of :-

Compare Business Accounts, Commercial Mortgages & Loans

Best corporate bank savings accounts interest rates for business ltd limited plc public limited companies

[SimonMac]

Have you thought of something like ratesetter? (P2P with an instant access)

Peer 2 Peer Lending and Social Lending in the UK - RateSetter.com: A better way to save or borrow, peer to peer.

I assume the website takes the cut between the Lending rate (4%) and the Borrow Rate (7.9%), nice little earner no wonder the Banks are raking it in.

[SimonMac]

What is the "legality" of drawing out my CT money (which is sat in a next to zero interest savings account) sticking it in my off set mortgage account and then paying my CT direct from my personal account when its due?

[MarillionFan]

For CT/VAT money?

This looks good for some business investing however

If you can put business money in, then why not CT/VAT. It has an instant drawer facility. I used it myself recently. My only concern is that it's covered by the £85k rule (but neither is Zopa).