Tax Advice for Local Closing down firm

[homer7929]

Hi,

I'm a local at a trading arcade in Surrey.

I have been a local for 1 year.

My split of my trading revenue is approximately £450k.

My non trading expenses (e.g. broadband, health insurance, computers) have been a palty £2k.

I am closing the business (which is a limited company) due to mental health issues and am going to work stress free for an orphaned kitten charity.

Anyway, I'd like to speak to a good accountant about my tax situation. I have a friend who's an accountant for PLC's, and he's given me the worst case scenario on my tax situation. However, he admitted that he was no personal tax expert and suggested I find a specialist. However, neither he nor I know any tax specialists.

Could anyone here provide me with some advice regarding finding a good personal tax accountant? Or how I should be minimising my tax liabilities in a legal manner? As far as I know the only non questionable way to reduce personal tax is to lock my cash into a pension, but I'm only 25 and won't be retiring for a while.

Thanks,

Homer.

 

[TheBramble]

You're not likely to get much sensible help here, but I could be wrong.

You can get tax relief if you sell an asset to a UK charity at less than market value.

Buy a wadge of stock "dealt in on the UK or another recognised stock exchange" with the funds that are still in the company. I'm assuming this is still corporate funds and you are dealing with and haven't done anything silly like given yourself a big income or dividends.

Sell it to the Orpahned Kitten Charity for £1.

Work some under-the-radar deal with the charity. I presume they are friends or at least open to a good deal. Especially if you are going to be working with them. Whatever their cut of the deal is, it's going to be a lot less than any tax liabilities and you've also saved a corptax accountant fee.

 

[donaldduke]

Hi,

I'm a local at a trading arcade in Surrey.

I have been a local for 1 year.

My split of my trading revenue is approximately £450k.

My non trading expenses (e.g. broadband, health insurance, computers) have been a palty £2k.

I am closing the business (which is a limited company) due to mental health issues and am going to work stress free for an orphaned kitten charity.

Anyway, I'd like to speak to a good accountant about my tax situation. I have a friend who's an accountant for PLC's, and he's given me the worst case scenario on my tax situation. However, he admitted that he was no personal tax expert and suggested I find a specialist. However, neither he nor I know any tax specialists.

Could anyone here provide me with some advice regarding finding a good personal tax accountant? Or how I should be minimising my tax liabilities in a legal manner? As far as I know the only non questionable way to reduce personal tax is to lock my cash into a pension, but I'm only 25 and won't be retiring for a while.

Thanks,

Homer.

Is the 450K after corporation tax? After corporation tax you will probably be left with about 350K.

If you are not going to be earning any other income for the next few years or your income is very low you can take dividends from the ltd company, as long as you are a low rate tax payer those dividends have no tax applied to them.

So in theory if you had no other income for next 10 years you could take a dividend of 35K a year with no personal tax to pay. If you had 15K in other income, you would only be able to take 20K a year of 'tax free' dividends.

If you want to shut down the company and take the money in one go, you really want to try to claim entrepreneurs tax relief, so you only pay CGT at 10% on your retained profits. You would need to speak to a good accountant to see if this is possible.

 

[donaldduke]

Another option might be given that you are free and single is to leave the country for a few years, move to zero tax country and declare a fat dividend while you are there. Again you will need to speak to a tax lawyer regarding the exact rules for doing this..

This maybe the best option ;-)

 

[Directional]

I know a tax accountant who specializes in trader tax and (legal) avoidance strategies who might be able to help you. PM me if you'd like his contact details.