How do I form a company?
This is quite straightforward assuming that you have basic information to hand. (such as the Company’s proposed name, Directors date of birth, place of birth, mother’s maiden!). We have in-house software and we can have a company up and running in 24 hours.
How do I pay myself?
Simply transfer funds from the business account to your personal account. Payments are normally net salary, dividends or a combination of the two. But remember, salary and dividend payments should be made as separate transactions.
How much do I pay myself?
Once you’ve agreed a salary with us, we’ll provide you with a wages summary. This provides guidance on your net salary that you can pay yourself on a monthly basis. You also have the option of taking some dividends, which are paid from remaining company profit.
How often can I make a dividend payment?
Interim dividends can be paid throughout the financial year; final dividends are paid at the end of the year. Dividends can ONLY be paid if the company has a ‘distributable profit’. Payment of dividends without profit is a breach of the Companies Act 2006. Director’s face repayment of all illegal dividends and possible prosecution. Once again, it comes down to planning, and monitoring actual against planned results in order that the payment of technically illegal dividends is avoided.
How do I pay shareholders company dividends?
The first thing you need to know is dividends are paid to shareholders from the company’s retained profit after tax, so you need to make sure the payment reflects the number and class of shares held.
Can I take a loan from the company?
Yes you can, but you should look at it as a short term measure. It’s best to speak us prior to moving funds to ensure you are aware of all the implications.
Can the company pay into my personal pension?
Definitely. The company can make payments into pension plans which are a tax deductible expense for the company.
Can the company make investments?
Yes, provided they are within the companies allowed investments and objects.
When are the company’s accounts due?
If the company is in its first year since incorporation, the accounts are normally due to be filed with Companies House within 21 months after the incorporation date however this may alter if the accounting period is changed. HMRC require accounts to be filed 12 months after the year end period. After the first year of trading, the accounts are due to be filed with Companies House 9 months after the year end and with HMRC 12 months (soon to be reduced to 9) after the company’s year end.
What is corporation tax?
Corporation tax is the tax a company pays on all its profits and gains, after deduction of allowable expenses and salary. Unlike personal tax, the same rate of corporation tax is charged on income of the company and any capital gains.
What rate is corporation tax?
The rate of corporation tax for small companies whose profits do not exceed £300,000 is currently 20% (tax year 2013-2014).
When is the company’s corporation tax due?
Usually corporation tax is due within 9 months and 1 day of the company’s year end, however this depends on the company trading date. We will advise you when and how to make payment.
What is a Companies House annual return?
An annual return is a document that is filed once a year at Companies House. It provides non-financial information about the company and ensures the public record is kept up to date. Companies House require a fee of £13 to file this document electronically and £45 to file a paper version (2013-2014). We charge a little admin fee should you require assistance for filling.
Can I do other work through my company?
Yes. Most companies Memorandums and Articles allow a wide range of business activities. You can run more than one activity through a company. As long as it is legal! We can help you understand your companies Memorandums and Articles and adopt new ones where required to suit your business needs.
What is IR35?
Be aware of this! Depending upon the nature of your business, it may affect you and potentially undermine the benefits of trading through a limited company. IR35 is HMRC tax legislation that was introduced to identify contractors who are receiving the tax benefits of working through a Limited company when they are really a disguised employee of the clients.
Does my company need an audit?
Generally your company will only be required to have a statutory audit if it is not ‘small’ company as defined by size criteria set down in The Companies Act (and amended from time tto time by Statutory Instrument). There are exceptions to this, for example if you are a company registered with the FSA. You will also be required to have an audit if more than 10% of your members require you to do so. You may also wish to have an audit for other reasons, for example if you are a members body that has to submit accounts to many members or if you are an organisation of public interest.
How do I close my company?
We can help you close the company, calculating any outstanding liabilities or refund and meeting the legal requirements, culminating in your company being struck off the register at Companies House. For detailed information, please contact us.
Posted in: FAQ