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Reply to: Bounce back tax

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Previously on "Bounce back tax"

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  • GhostofTarbera
    replied
    Originally posted by ladymuck View Post
    Tarby can give you some tips on where to find such people if needed
    £50K would last me about 6 weeks in Thailand anyhoo


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  • ladymuck
    replied
    Originally posted by elsergiovolador View Post
    Especially if one arranges wo/men in suits to extract the debt from oneself
    Tarby can give you some tips on where to find such people if needed

    Leave a comment:


  • jayn200
    replied
    Originally posted by oilboil View Post
    Maybe it does, but unless you take it out as salary, you would still be required to either service the loan until paid (and after 12 months interest is due as well) or pay back the loan before you closed the company.

    If you think the UK Gov can't touch you in Thailand you are sorely mistaken

    Similarly I can't see £50K lasting more than 3 years in Thailand having spenf a lot of time there working - yes a Thai can live on less but a "farang" with all the double-pricing etc. would really struggle to live on £16K a year for any length of time (unless you really like squalour)
    I am pretty sure it was just a joke.

    Most people here are contractors earning 100-150k+ a year (200k+ a year technically to qualify for 50k loan), probably not gonna take 50k and go on the run lol.

    Leave a comment:


  • oilboil
    replied
    Originally posted by GhostofTarbera View Post
    50K lasts a long time in retirement in Thailand / Vietnam

    Just saying like


    Sent from my iPhone using Contractor UK Forum
    Maybe it does, but unless you take it out as salary, you would still be required to either service the loan until paid (and after 12 months interest is due as well) or pay back the loan before you closed the company.

    If you think the UK Gov can't touch you in Thailand you are sorely mistaken

    Similarly I can't see £50K lasting more than 3 years in Thailand having spenf a lot of time there working - yes a Thai can live on less but a "farang" with all the double-pricing etc. would really struggle to live on £16K a year for any length of time (unless you really like squalour)

    Leave a comment:


  • elsergiovolador
    replied
    Originally posted by Old Greg View Post
    You personally owe the company money, so not as easy to walk away from the company and its debt.
    Especially if one arranges wo/men in suits to extract the debt from oneself

    Leave a comment:


  • GhostofTarbera
    replied
    Originally posted by Old Greg View Post
    You personally owe the company money, so not as easy to walk away from the company and its debt.
    50K lasts a long time in retirement in Thailand / Vietnam

    Just saying like


    Sent from my iPhone using Contractor UK Forum

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  • Old Greg
    replied
    Originally posted by jamed View Post
    In my opinion, for short term personal funding(which is pretty much the only reason a LtdCo contractor would use the BBL) is that a director's loan is the most cost-effective way of getting the money out.

    Paying it out as a salary means a nasty bit of tax, all for some short term financing. Dividends obviously incur less tax but you still are still possibly paying thousands of tax just to have some cash in your pocket now that you need to pay back in the future.

    Not sure if I'm missing something here or if there is another better way of doing it?
    You personally owe the company money, so not as easy to walk away from the company and its debt.

    Leave a comment:


  • jamed
    replied
    In my opinion, for short term personal funding(which is pretty much the only reason a LtdCo contractor would use the BBL) is that a director's loan is the most cost-effective way of getting the money out.

    Paying it out as a salary means a nasty bit of tax, all for some short term financing. Dividends obviously incur less tax but you still are still possibly paying thousands of tax just to have some cash in your pocket now that you need to pay back in the future.

    Not sure if I'm missing something here or if there is another better way of doing it?

    Leave a comment:


  • GhostofTarbera
    replied
    Originally posted by mjcp View Post
    Aren't they funds for the loans the Gov't owned British Business Bank Plc? Or is it just they who guarantee any loans issued under the Bounce back scheme?

    Either way, I doubt any banks would have problems getting seed funds / source funds as the risk is minimal, being effectively insured by the gov't.

    M
    Starling already begging funding circle for money, after burning its own money


    Sent from my iPhone using Contractor UK Forum

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  • mjcp
    replied
    Originally posted by GhostofTarbera View Post
    I see Starling bank has had to borrow £300M as ran out of money to deliver bounce back loans, I predict they close applications fiverr even in next few days

    Same for tide, they are going live this week, I predict 2 days for them


    Sent from my iPhone using Contractor UK Forum
    Aren't they funds for the loans the Gov't owned British Business Bank Plc? Or is it just they who guarantee any loans issued under the Bounce back scheme?

    Either way, I doubt any banks would have problems getting seed funds / source funds as the risk is minimal, being effectively insured by the gov't.

    M

    Leave a comment:


  • GhostofTarbera
    replied
    I see Starling bank has had to borrow £300M as ran out of money to deliver bounce back loans, I predict they close applications fiverr even in next few days

    Same for tide, they are going live this week, I predict 2 days for them


    Sent from my iPhone using Contractor UK Forum

    Leave a comment:


  • Lance
    replied
    Originally posted by elsergiovolador View Post
    A company can't make profit while providing service "inside IR35", it's impossible.
    which may be true but is entirely irrelevant to the question or the discussion.

    Leave a comment:


  • GhostofTarbera
    replied
    Originally posted by oilboil View Post
    If you are a more traditional company that requires more than just you to make money this spending it on payroll makes sense. You can't get out of COVID cash-constraints because you can't pay your staff to make your widget, and you can't sell your widgets because you've no money to pay the staff to make them. The loan just alleviates one side of the problem. If your business is otherwise viable, you will be able to sell the things you build with the loan cash and everything eventually gets back to normal.

    The other option of course is to take your £25,000 (based on a one-man limited IT consultancy turning over £100k), immediately turn it round as a £25k salary payment (incurring between £3-£10K in tax and NI - depending on other payments you make this year) then bankrupt the company and go out of business. It's essentially a £25K grant so long as you have no plans to use the company again
    Option 2 seems to be preferred approach


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  • jayn200
    replied
    Originally posted by oilboil View Post
    If you are a more traditional company that requires more than just you to make money this spending it on payroll makes sense. You can't get out of COVID cash-constraints because you can't pay your staff to make your widget, and you can't sell your widgets because you've no money to pay the staff to make them. The loan just alleviates one side of the problem. If your business is otherwise viable, you will be able to sell the things you build with the loan cash and everything eventually gets back to normal.

    The other option of course is to take your £25,000 (based on a one-man limited IT consultancy turning over £100k), immediately turn it round as a £25k salary payment (incurring between £3-£10K in tax and NI - depending on other payments you make this year) then bankrupt the company and go out of business. It's essentially a £25K grant so long as you have no plans to use the company again
    I would be weary of doing this. How would you explain it as anything other than attempting to extract the loan for personal use which is prohibited.

    What legitimate reason would a business have for issuing such a large bonus to an employee when they have lost their revenue stream. Maybe you can come up with some creative rationale or just hope it never get queried.

    Leave a comment:


  • elsergiovolador
    replied
    Originally posted by oilboil View Post
    You are obviously doing it wrong, plenty of people make a profit on providing services. Maybe you meant "you won't necessarily be able to make as much profit"???
    A company can't make profit while providing service "inside IR35", it's impossible.

    Leave a comment:

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