paye – Numbers UK Ltd

May 5, 2015 by Rachael Carey 0

Director/shareholder reward packages: The dynamics have changed

Introduction The introduction of the Employment Allowance (“EA”) allows employers a discount of up to £2,000 off their liability to Employers’ NIC. This has added another factor into the salary vs dividend debate. There is one other complicating factor as well. The level of other taxable, non-dividend, income enjoyed by the director/shareholder. If there’s no other income A salary equivalent to the director’s personal allowance is most efficient. The additional NIC paid by the director (at 12% on the excess over £8,060) is more than compensated by the additional corporation tax saving at 20%. With no other employees, this works for companies with up to 5 directors/ shareholders. What if the director has other income? Many directors own the company premises, and enjoy a rent from that. Where rent (or indeed any other taxable income) is enjoyed by the director, a little more care is needed. The optimal position would…

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February 21, 2014 by Owen Jones 0

News

A Government give-away (with conditions)

Introduction One of the goods things to come out of recent budgets is the new holiday for Employer National Insurance Contributions (“NIC”). The Employment Allowance allows small and medium enterprises (“SME”) to deduct up to £2,000 from their employer NIC payments. The details The holiday is worth up to £2,000 per annum. This starts on April 6th 2014, and must be claimed by qualifying employers. HMRC are expecting employers to take the deduction as early as possible, so many will see the benefit on 19 May 2014 (when the first payment is NOT made. You can only claim it once, even if you run more than one PAYE scheme. If you are part of a group, only one company can claim the allowance. Who cannot claim? The main exclusions are companies and organisations that provide “public sector” services. These include: NHS services General Practitioner services the managing of housing stock…

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