Divorce after 12 years contracting Divorce after 12 years contracting - Page 3
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  1. #21

    Fingers like lightning


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    Quote Originally Posted by flapping View Post
    I asked my accountant whether I could apply to HMRC for clearance to set-up another company within 2 years, the response I got to closing it “will restrict you from going back into contracting for 2 years.”

    Perhaps I was expecting too much from my them
    I’d get advice from a specialist who deals with closing with MVL (Maslins?) rather than your accountant who might not know all the intricacies of it.

  2. #22

    Contractor Among Contractors


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    Quote Originally Posted by flapping View Post
    I asked my accountant whether I could apply to HMRC for clearance to set-up another company within 2 years, the response I got to closing it “will restrict you from going back into contracting for 2 years.”

    Perhaps I was expecting too much from my them
    Just to clear up a few things:
    - There is nothing legally stopping anyone from closing one company and starting another.
    - There is targeted anti avoidance rules (TAAR) which can bite if you're liquidating Oldco and setup Newco doing something similar within 2 years. This doesn't stop you restarting, but can alter the tax treatment you got when closing Oldco (meaning CGT rules no longer apply to it, instead it's taxed as a dividend).
    - My understanding is this only applies when liquidating, not when striking off. Ie if you have £20k final net assets, strike off, restart same thing day after, you wouldn't be at risk from the TAAR.
    - This does not mean I would encourage everyone to build up modest (£20k-24.9k) reserves and strike off every year or two. Firstly it would be a lot of effort for modest gain, and secondly it could be attacked by HMRC via GAAR (general anti abuse rules).

    So in your situation, do of course ensure final company tax matters etc are tidied up, but then I see no issue with you taking the remaining ~£20k as capital gains (quite possibly entirely tax free if 50:50 owned and no other capital gains in the year), and you starting a new company immediately after as 100% shareholder.

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