Share restructure. Alphabet shares for better divi distribution. Share restructure. Alphabet shares for better divi distribution.
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  1. #1

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    Default Share restructure. Alphabet shares for better divi distribution.

    Does anyone use alphabet shares gifted (or better sold at market value) to unconnected persons (e.g. mother/father or friend).

    Restructure plan is:

    director: 53 ordinary shares
    spouse: 47 ordinary shares
    new alphabet shares: 2 with full voting rights.

    Total 102 shares. director has >51% of Ltd.

    Anyone does it?

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    Only people that have a clue and even then they'd be pretty daft to. They probably asked their accountants first as well.

    Another tax dodging failed idea it seems.
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    Quote Originally Posted by pscont View Post
    Does anyone use alphabet shares gifted (or better sold at market value) to unconnected persons (e.g. mother/father or friend).

    Restructure plan is:

    director: 53 ordinary shares
    spouse: 47 ordinary shares
    new alphabet shares: 2 with full voting rights.

    Total 102 shares. director has >51% of Ltd.

    Anyone does it?
    MyCo has three classes of shares. All shares have equal rights. There is sound business reason for doing so.

    If you tell us the business reason for the classes of shares you propose we might be able to comment on it. Since HMRC can easily see your share structure by checking Companies House it would probably be a good idea to have a real business reason for using alphabet shares. Otherwise, you might end up in an uncomfortable investigation as to whether you are using them as income settlement or something else inappropriate.

    In short, it is possible, and might make sense in some cases, but it might be a really bad idea, and many people who get brilliant and exciting ideas about using alphabet shares are probably setting themselves up for trouble.

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    Quote Originally Posted by WordIsBond View Post
    MyCo has three classes of shares. All shares have equal rights. There is sound business reason for doing so.

    If you tell us the business reason for the classes of shares you propose we might be able to comment on it. Since HMRC can easily see your share structure by checking Companies House it would probably be a good idea to have a real business reason for using alphabet shares. Otherwise, you might end up in an uncomfortable investigation as to whether you are using them as income settlement or something else inappropriate.

    In short, it is possible, and might make sense in some cases, but it might be a really bad idea, and many people who get brilliant and exciting ideas about using alphabet shares are probably setting themselves up for trouble.
    Have a look at the OP started threads history. There is absolutely no business reason for doing any of the evasion techniques he's asking about. Just looking for a way to screw his company for more than he is due.
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    Quote Originally Posted by northernladuk View Post
    Have a look at the OP started threads history. There is absolutely no business reason for doing any of the evasion techniques he's asking about. Just looking for a way to screw his company for more than he is due.
    Evasion is an ugly word for an honest entrepreneur with a keen eye for personal growth.
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    Quote Originally Posted by Old Greg View Post
    Evasion is an ugly word for an honest entrepreneur with a keen eye for personal growth.
    Ah. Yes you are quite correct. If only there was one around I might have the chance to apologise and correct my poor phrasing.
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    Default Entrepreneurs Relief

    Might be worth noting that there is a chance that alphabet shareholdings won't qualify for entrepreneurs relief if/when the time comes to close/sell based on the new changes from the budget. Although the revenue have said this is an unintended consequence that means nothing if they want to really get you and deny relief.

    Martin
    Contratax Ltd

  8. #8

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    Quote Originally Posted by pscont View Post
    Does anyone use alphabet shares gifted (or better sold at market value) to unconnected persons (e.g. mother/father or friend).

    Restructure plan is:

    director: 53 ordinary shares
    spouse: 47 ordinary shares
    new alphabet shares: 2 with full voting rights.

    Total 102 shares. director has >51% of Ltd.

    Anyone does it?
    If the only reason to do it is to take advantage of other individuals tax allowances in order to extract more cash from the company then it is a very bad idea. Given your previous posts I think it's safe to assume this is your intention.

    If any of the cash from the new shares makes its way back to other shareholders then HMRC will regard that as evaision and tax you appropriately along with penaties and interest regardless of how much they may or may not have paid for them.

    In case of an investigation they will look at gifts or other transfers received from those individuals and match them to dividend payements they received and assume you are on the fiddle. They will also investigate the people involved and possibly charge them with conspiracy.

    Stop trying to come up with ways to play the system, none of them work and have all been thought of by others long ago. Even the ones that appeared to work at the time can come back and bite you later cf. the Loan Charge.
    "Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.

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    Quote Originally Posted by northernladuk View Post
    Have a look at the OP started threads history.
    LOL. Not being an expert in everything that everyone here has posted, and not wanting to become such, I think I'll pass. My comment is legit whether he's a chancer or not. There's sufficient usefulness to anyone reading the question who isn't a chancer, and sufficient warning to anyone who is.

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    Read the scheme enquiries thread. Then decide if its a good idea or not.....

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