company perks?

[Friday Blue]

Hi all,

when I was staffy in previous companies (both blue-chipped), I noticed the managers get car and housing benefits. are these something may be I can look into setting up with my own ltd company?

the car scheme is slightly different to conventional company car scheme. They will buy/lease the cars under their own name (not under company's name), usually on personal/contract lease. They then get a monthly receipt for their monthly payment and submit it as expenses. Maintence/petrol cost however is not claim-able.

Similarly, for housing benefits, they will rent somewhere nice and just put the monthly receipts as expenses.

Do these kind of schemes attract alot of attention from taxman? Especially for a small company like mine, it will really shows up on the books as opposed to their massive blue-chip accounting records which makes these "small" expenses easy to hide. Becuase if it is as simple as it seems, then it may be a good way to offset the pre-tax profit?

Cheers

[northernladuk]

Hi all,

when I was staffy in previous companies (both blue-chipped), I noticed the managers get car and housing benefits. are these something may be I can look into setting up with my own ltd company?

the car scheme is slightly different to conventional company car scheme. They will buy/lease the cars under their own name (not under company's name), usually on personal/contract lease. They then get a monthly receipt for their monthly payment and submit it as expenses. Maintence/petrol cost however is not claim-able.

Similarly, for housing benefits, they will rent somewhere nice and just put the monthly receipts as expenses.

Do these kind of schemes attract alot of attention from taxman? Especially for a small company like mine, it will really shows up on the books as opposed to their massive blue-chip accounting records which makes these "small" expenses easy to hide. Becuase if it is as simple as it seems, then it may be a good way to offset the pre-tax profit?

Cheers

Do you have an accountant? If you are looking at this type of thing you need to get advice from him. The very quick bottom line is it is not worth doing either as a benefit. Remember benefits are often paid to keep good people, not because they are tax efficient. You can pay for anything you want for yourself but you cannot claim it back in tax so are just spending money which isn't a benefit to you at all.

If you still want to dig around to see what the fall out of each of these ideas is do a search first, cars, mortgages etc have been asked about many many times.

It isn't tax efficient to buy a company car, you will just end up paying about the same if not more once BIK and other aspects taken in to account.

The only benefit when your in an LTD is anything that will save you tax and unless it is something that is wholly and exclusively for businsess use it won't be tax efficient. Other than that the company is spending it which means it won't reach your pocket so it's your money you are spending ultimately

[MarillionFan]

Do you have an accountant? If you are looking at this type of thing you need to get advice from him. The very quick bottom line is it is not worth doing either as a benefit. Remember benefits are often paid to keep good people, not because they are tax efficient. You can pay for anything you want for yourself but you cannot claim it back in tax so are just spending money which isn't a benefit to you at all.

If you still want to dig around to see what the fall out of each of these ideas is do a search first, cars, mortgages etc have been asked about many many times.

It isn't tax efficient to buy a company car, you will just end up paying about the same if not more once BIK and other aspects taken in to account.

The only benefit when your in an LTD is anything that will save you tax and unless it is something that is wholly and exclusively for businsess use it won't be tax efficient.

WTRS*

Not normally tax efficient to add in huge bonuses.

There are benefits to things like childcare vouchers, pensions, purchasing equipment / training etc which are all about the best use of tax/claiming back VAT etc. In addition, no reason (if you're going to work at home) that you cannot claim back some costs for renting an office(TR will disagree here), take out a mobile in the business name, obviously subsistence, travel/mileage, maybe paying a partner helping you out with book keeping, maybe even a few 'business meetings over dinner' etc. But obviously they all have to be legititmate expenses in the running of the business. It's just about you reducing your tax liabilities and reducing your profit for corporation tax.

* NLUK is our CUK Rottweiler

[Taxless]

As NLUK indicates, there are a lot of things to consider and a lot more detail required.

This is about your unique circumstances and I would not recommend a DIY job.

[Tanya@SC Lee Accountant Ltd]

Yes, what Marillion Fan mentioned are very good examples for reducing the profit

Thanks
Harry Lee

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WTRS*

Not normally tax efficient to add in huge bonuses.

There are benefits to things like childcare vouchers, pensions, purchasing equipment / training etc which are all about the best use of tax/claiming back VAT etc. In addition, no reason (if you're going to work at home) that you cannot claim back some costs for renting an office(TR will disagree here), take out a mobile in the business name, obviously subsistence, travel/mileage, maybe paying a partner helping you out with book keeping, maybe even a few 'business meetings over dinner' etc. But obviously they all have to be legititmate expenses in the running of the business. It's just about you reducing your tax liabilities and reducing your profit for corporation tax.

* NLUK is our CUK Rottweiler