Is this income splitting?
Client has approcahed me who is a sole trader selling his own services as a go-kart trainer to individuals as well as selling go-kart spares and stock to individuals and companies.
His business turnover has now reached the VAT threshold and is conscious of the effect that a 20% increase will have on his business in relation to the training income as his customers are mainly individuals.
So he has come up with the idea of splitting his business into a sole trader side which sells training and a Ltd Company which sells stock and spares.
I have mentioned to him that income splitting to avoid registering for VAT isnt allowable but I am equally unsure as to whether the 2 businesses are so distinct as to be 2 seperate entities in the manner in which they trade that income splitting wouldnt be an issue here.
Can anyone advise?
- Taxfiler - SA100 - More efficient? 659 5
- See you all on the other side 705 6
- 12Pay 468 2
- dividends 637 2
- R&D 330 1
- Quarterly Reporting - The Logistics 1,193 17
- Auto enrolment contribution rates 443 3
- How long are you waiting for appeal reply 425 4
- Borrowing money to loan to company 379 1
- Mother as Guarantor for Son's mortgage 551 5
- Seeking a tax case 649 9
- When do we qualify for state pension? 510 4
- Companies house strike off 574 3
- Tax treatment of alterations to property 438 2
- Moving to the cloud 754 9
- Iris open space/doc exchange for SATRs 218 2
- How much to charge for payroll? 911 16
- Unincorporated charity transfer to CIO 219 4
- BTC vs Digita 1,093 29
- Has anyone tried calling HMRC to get tax on dividends put in code? 509 4
- HMRC Joint Filing 563
- Capital Contribution towards a company car 420
- Capital Reduction & Impact on EIS Shares 373
- IRIS and FRS 102 355
- Capitalising Finance Lease 328
- USA help 318
- Marginal rates of tax 307
- National Minimum Wage issue on Directors joining a Workplace Pension 307
- Dormant company accounts under FRS 102 295
- Class 2 NI 284