All, I would appreciate your comments regarding our plan on how to handle our salary/dividends/tax matters when it comes to the limited company that I have just founded together with my wife.
Mr
- He is a director of the limited company
- He is paid a salary of £8,424/year
- Owns 70% of shares and receives 70% of dividends (£2,000 tax free and the rest taxed at 7.5%)
- He works for different clients, does IT consultancy, on average 6 months long contracts, on average £400/day, on average 200 days/year - total company’s income is on average £80,000/year, expenses (travel) are on average between £5,000 - £10,000/year
Mrs
- Works part-time, for another company, earns around £20,000-25,000 per year before taxes.
- She does all the bookkeeping and paperwork for the limited company that we have founded
- Not a director, owns 30% of shares and receives 30% of dividends (£2,000 tax free and the rest taxed at 7.5%)
Mr and Mrs live under the same roof.
None of us ever goes above £46,351 (higher tax rate).
Would it sound OK to HMRC?
Many thanks for all constructive feedback.
Mr
- He is a director of the limited company
- He is paid a salary of £8,424/year
- Owns 70% of shares and receives 70% of dividends (£2,000 tax free and the rest taxed at 7.5%)
- He works for different clients, does IT consultancy, on average 6 months long contracts, on average £400/day, on average 200 days/year - total company’s income is on average £80,000/year, expenses (travel) are on average between £5,000 - £10,000/year
Mrs
- Works part-time, for another company, earns around £20,000-25,000 per year before taxes.
- She does all the bookkeeping and paperwork for the limited company that we have founded
- Not a director, owns 30% of shares and receives 30% of dividends (£2,000 tax free and the rest taxed at 7.5%)
Mr and Mrs live under the same roof.
None of us ever goes above £46,351 (higher tax rate).
Would it sound OK to HMRC?
Many thanks for all constructive feedback.
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