Company Savings Account

W

Wahaay

Registered User
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My Ltd company has around €150k in accrued profits picking up a pitiful rate in a Rabo 90-day account.
Has anyone any suggestions of a better place for theses funds which don't need to be touched for a number of years and which increase by approx €20k per annum.
Many thanks in advance.
 
All corporate and personal rates are low at the moment. Corporate rates are even lower than personal rates.

Not all banks publish their corporate rates. You are best doing a ring around.

0.50% is the highest corporate rate with PTSB.

You may not find a bank paying above Rabo's 0.75%.
 
Hello,

Depending on future plans and your view on risk, I would suggest you start looking at other options for the money, be it investment in the business, potential to extrat it tax efficiently or else investments with potentially low risk attached in return for slightly higher returns. All indications are that deposit rates are going to remain low for the next few years.
 
It's very inefficient to be accumulating money in a company. And if it's increasing by €20k a year, you are just making the problem bigger.

Take the money out either as salary or pension contributions and bite the tax bullet. If the company needs cash at some time in the future, you can give them a director's loan.

Brendan
 
I take your point Brendan but I'm only 3-4 years away from retirement and will be using retirement tax relief on the sale of the company.
 
Be careful not to put it into anything that could be considered an investment!!!
 
Wahaay said:
I take your point Brendan but I'm only 3-4 years away from retirement and will be using retirement tax relief on the sale of the company.
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Remember that cash is disallowable when availing of retirement relief, maintaining it in a company structure will not allow for a reduced tax removal at that point.
 
rob oyle said:
Remember that cash is disallowable when availing of retirement relief, maintaining it in a company structure will not allow for a reduced tax removal at that point.
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Is that a professional opinion? I would beg to differ!
 
Joe_90 said:
Is that a professional opinion? I would beg to differ!
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I'm not a professional in this area, but my understand from a tax exam I did was that non-business related assets are not included, so cash and other investments are out. Going to check now though!
 
Have a look at chargable business assets and chargable assets and the formula for calculating retirement relief.

Note that Irish currency (Euro) is neither a chargable business asset or a chargable asset - hence my comment about not turning it into an investment which could become a non qualifying chargable asset and result in the relief not applying.

This assumes that the cash came from trading activities and not from investments.
 
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rob oyle said:
Remember that cash is disallowable when availing of retirement relief, maintaining it in a company structure will not allow for a reduced tax removal at that point.
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This is incorrect.

Cash is effectively disregarded and can be taken out tax free by way of retirement relief (obviously subject to meeting the relevant conditions).
 
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