Claiming profit from Ltd Company

Hi,
I setup a Ltd company a few years back with an overseas partner.
Each year I sent him his % profit. I have being earning a wage but have not taken out my % profit yet.
I think this was a bad idea and I now wish to do so.

What is the best way to go about doing this. Its just a small business I run on my own so we're not talking huge figures. My partime bookeeper doesn't know the best way either.
My accountants charge threw the nose each time I have gone to them in the past so am reluctant to approach them unless I have to..
Thanks in advance...

If you can not approach your Accountant with a question like that, You would be better off to get a new Accountant who has time to deal with such a query. Is this not done at accounts review stage at year end?

You present accountant should have all the facts to do with your business. Surely a email or a meeting would get your the answers you need.

It is hard here to advice as We would not know the full facts of company profitability, your earnings, wife earnings, what it saids in shareholder aggrement about profit splits, cashflow of company etc.

No it was never mentioned to me. My accountants are a largish firm, anytime I have approached them with queries on the business they want to arrange meetings, send out official letters and in the end, bill me like its xmas bonus time... (figure of speech)

I understand what you're saying though so I guess I'll have to bite the bullet and speak with them...

Greenfield08 said:

No it was never mentioned to me. My accountants are a largish firm, anytime I have approached them with queries on the business they want to arrange meetings, send out official letters and in the end, bill me like its xmas bonus time... (figure of speech)

I understand what you're saying though so I guess I'll have to bite the bullet and speak with them...

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Its always a good idea to employ an accountant that is a good fit to your size of business. Sometimes the largest firm is not always the best for you and a smaller firm can provide just as good a service for less cost.

dbran said:

its always a good idea to employ an accountant that is a good fit to your size of business. Sometimes the largest firm is not always the best for you and a smaller firm can provide just as good a service for less cost.

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+1

If I'm reading this right - year on year your company has turned a profit (slight or not) - your partner has been paid his % of this profit and yours has been retained within the company.If this is correct, year on year you have paid corporation tax on this figure and now you want to pay this profit to your self (presumably as a director's bonus) and you will have to pay paye tax (a second tax) on these same profits.was this strategy adopted on the basis of your accountant's advise or your own ?sounds like you really need to look at your accountant and switch if necessary.

Well I wasn't sure what to do at the time so left the money there, My accountant has never mentioned this to me and I didn't bring it up.
I'm looking for the most economic way of getting those funds out.

Presumably the company has issued a dividend to the overseas partner. Dividends don't affect profit, or the tax thereon. You can also receive your profit as a dividend, but will be paying tax at the applicable rate. At least if you increase your wage, the company will be taxed on a lower profit. Your accountant should be able to run various scenarios to see which is the most tax efficient for you.
Depending on your age, you might be happy to have the company pay money into a pension fund for your eventual benefit; that also reduces the company profit and tax, and you would be entitled to a tax-free lump sum when you reach the chosen retirement age.