Tax Efficient Profit Split from a Private Limited company

enterthe

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Hi,

I'm starting a small limited company with an associate.

The associate will be the primary share holder (he'll own around 80%, I'll have 20%), but the profit split will be 50/50 as I'm providing the expertise.

What is the most tax efficient way to do this? I'd rather not pay 40%.

Thanks,

Enter.
 
If you're talking about a UK LTD, dividends are normally the way to go, but with an unequal share split you may find a dividend split that does not mirror equality of holdings might be subject to a non-cursory review by HMRC.

If this isn't for the long haul, or if it's effectively a one-off I'd suggest a non-LTD solution would be more appropriate.

If you're non-UK or any of the above do not apply, please disregard and seek professional advice. Actually, might be an idea to do that anyway.
 
Formally....take small salaries and large divis to minimise your NI bills...informally the company could have all sorts of expenses :eek:
 
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