Make Sense | Tax Planning
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TAX PLANNING

What are the two things you can’t avoid in life?

Death and Taxes. Even death doesn’t get you out of paying taxes, part of probate is settling outstanding tax bills before your family get your assets.

When should you start Tax Planning?

When setting up a company.
After the company is successful.
When the children are old enough to receive a dividend.

Payroll

Pay yourself a minimum salary which doesn’t attract tax or NI contributions and take the rest in dividends. (Assuming you are not caught by IR35).

Pension

You can take £40,000 per annum without tax or NI deductions (personal and company) and pay into a pension. This is invested for your retirement and you can’t access the funds until you are 55 years old. 25% can be withdrawn tax free at 55 and the rest used as an income for the rest of your life. (I can refer you to an IFA as you need to speak with financial adviser first).

Shareholders

Add your partner / spouse, children as shareholders and pay them a dividend. You must pick the right share class with no voting rights or else if you fall out, they would have a say in your company.

Expenses

It is important you offset the correct expenses for 2 reasons.

  • to make sure you are not paying tax on business expenses which are tax deductible.
  • you do not want to claim the wrong things or you will be building up a tax liability for the future.

There are many more legal ways to minimise your taxes and you should call us now for free initial consultation.

For more information contact us on

0121 356 2746