benlewis13
06-01-2007, 09:29 PM
OK guys, tell me if there is anything I can be caught out on here.
We get paid for a gig. We write off travel and subcontractors as expenses. Say that leaves us with £200. Now, say i own personally some of the lights the business uses. I then charge the business say £190 to hire those for the night. That leaves just £10 to be taxed, and then go to official company profits and shareholders (shareholders are the directors). With that £190 i charged for the lights, I give cash in hand (off the record), as a present if you like, or for whatever other reason, to the directors, as their payment for the night. Now remember my own business, is a soletrader. I just happen to be a director and shareholder of CPS Events, therefore no tax is paid on the lights as not enough income is earnt for income tax, there are no NI taxes as a low paid sole trader, and there is no corporation tax.
Is there anything you can be caught out on with that?
(Please, no harsh comments, im learning from a tax man and other business owners)
We get paid for a gig. We write off travel and subcontractors as expenses. Say that leaves us with £200. Now, say i own personally some of the lights the business uses. I then charge the business say £190 to hire those for the night. That leaves just £10 to be taxed, and then go to official company profits and shareholders (shareholders are the directors). With that £190 i charged for the lights, I give cash in hand (off the record), as a present if you like, or for whatever other reason, to the directors, as their payment for the night. Now remember my own business, is a soletrader. I just happen to be a director and shareholder of CPS Events, therefore no tax is paid on the lights as not enough income is earnt for income tax, there are no NI taxes as a low paid sole trader, and there is no corporation tax.
Is there anything you can be caught out on with that?
(Please, no harsh comments, im learning from a tax man and other business owners)