Discuss Paying yourself through a Ltd as a subby in the Business Related area at ElectriciansForums.net

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Again you have stated very strong views which are your own interpretation of tax laws. The NMW legislation is quite clear and doesn’t mention managing or silent directors or those ‘on the tools!’ it clearly only mentions those subject of a contract. No contract as a director NMW simply does not apply!

If you are working as a Director on day to day activities just because you don’t have a written contract of employment does not mean you are exempt from NMW.

To pay yourself 100% in dividends is unethical and illegal.
 
I don't want to muddy the waters but are you sure a contact has to be explicit? When i was looking at employment law for sometime who was working without a contract for a dodgy company, it appeared that a deemed concontr was automatically formed, and if the statement of employment was not provided in writing then the court would decide the terms of the contract.
Obviously that was relating to actually working for an unrelated company, but I'd be surprised if there was no equivalent here.

AsAa different topic this minimum wage thing seems risky t me as well, you'd be lucky to find an electrician happy to work for minimum wage so even then one day the hmrc might start challenging the rates of pay when working for your own company.

You first point is absolutley right. The courts will look at what was actually taking place if nothing is written down. Working as an electrician for a company and not being paid NMW will be seen as exactly that by the courts.

You second pount is also a good one. I do think eventually HMRC will look into what company directors pay themselves to ensure it is in-line with the average for that role.
 
Look, everyone can have their views but it is up to accountants to decide what is best for their clients individual circumstances. Whatever anyone says there is no single rule for tax affairs and it can be a minefield. My point in all of this and what is clear is that it is not an offence to pay yourself solely a dividend as a company director. The national minimum wage legislation quite clearly states that if a director is not subject of a contract they are not bound by the legislation, it is there in black and white. In legal terms a contract is stated in law. What is ethical does not come into it and it is not illegal to pay yourself a dividend, your argument is flawed and incorrect. End of!
 
what is this tax i hear so much about? i pay tax on beer, smokes, diesel, food, bills, materials, nowt left in the pot for any other taxes.
 
I've bitten the bullet and gone for a new accountant. She charges a monthly fee which includes self assessment, payroll, corporation tax (basically everything) so no nasty surprises this time. After just a phone call and few emails, the difference in level of service has really opened my eyes and highlighted a few things

Luckily I managed to change just in time before the new tax year and should be able to get my payroll etc set up.

Thanks everyone for comments and suggesting I change accountant :D
 

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