Originally posted by expat
No "ex" about it, mate 
I'm just saying that earnings from work, and return on working capital, are not the same thing. I'm not really judging whether the effective tax rate on them should be different, nor am I saying that contractors running Ltd Cos should refrain from legal methods of reducing taxes (I especially like the idea of working less myself). But re-classifying earnings from work as return on capital, when in reality the company is not a capitalist company, is essentially dishonest. As I said, the govt, asked for it. But it's wrong.
I'm just saying that earnings from work, and return on working capital, are not the same thing. I'm not really judging whether the effective tax rate on them should be different, nor am I saying that contractors running Ltd Cos should refrain from legal methods of reducing taxes (I especially like the idea of working less myself). But re-classifying earnings from work as return on capital, when in reality the company is not a capitalist company, is essentially dishonest. As I said, the govt, asked for it. But it's wrong.
If I were working for someone else I would be earning circa 27K. My company income is going to be about 90K ignoring costs and expenses and stuff my company makes 63K which can then be seen as working capital or profit to be spread amongst shareholders. If we only got Divvies on what we put in originally then there would be no point starting a business.
It is not about how much you put into the pot it is about how much profit your business can make.
Alan Sugar started with 100 quids worth of car ariels and a barrer. Branson started with a few quidsworth of stock. Bill Gates started with very little too.
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