Corporation Tax or Income Tax

P

pahadia

Registered User
Messages
35
Hi All,
I work through self managed Ltd. company. I have around Euro 30,000 in company account. I am wondering what would be the best option for me. To pay corporation tax and keep money in company accounts or pay bonus to myself and pay income tax?

Any advice?

PS: I remember similar discussion on this forum in the past, but can't seem to find that thread. Sorry for creating new thread.

Many Thanks
Pahadia
 
Re: Corporation Tax or Inome Tax

Have you an accountant? If not, you should really be talking to one...
 
Re: Corporation Tax or Inome Tax

Do you need the money for the business? If so, consider leaving it there. If not, consider paying yourself the bonus.

If you leave it in the company and pay the CT, well there'll be less there when you eventually decide to take it out.
 
Re: Corporation Tax or Inome Tax

Just out of curiosity did you initially fund the company through share capital or through loan capital. As a result of good advice I was able to withdraw my initial loan capital from my company a couple of years ago tax free because the money was lent to the company instead of being invested. This may not be an option open to you.
 
Re: Corporation Tax or Inome Tax

Hi,
Niether I need this money for business nor intially I funded the company. Actually I am a contractor and collected this amount overtime in case I go out of contracts. Now is the time to take action so thinking which way to go ?

Many Thanks
Pahadia
 
Re: Corporation Tax or Inome Tax

You probably should get some advice. There would be a number of options open to you: funding a director pension plan, for example. Or if you pay tax at the top rate this year but expect business to be slow or even non-existent next year, you could leave it in there and withdraw next year at the lower tax rate.
 
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