My client is sole shareholder of an engineering company making profits of approx £250K.
After years of procrastination, and pressure, he eventually legalised the union with his partner, who trades though a limited company as a hairdresser making profits of approx £30K.
I have told them that in the eyes of HMRC their companies are now associated with rather unpleasant tax consequences.
It seem's very unfair as there is no interdependence or trading relationship between the two companies, but I would seek confirmation that I am correct.
Assuming I am I shall recommend that she disincorprates and becomes a sole trader or LLP with her husband.
Thank you.
John Lewis
Replies (2)
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i agree that there should a concession as in the cases of PPR re
but on the other hand they dont appear to be doing to badly. i presume that monies are coming out by dividend, maybe he could increase his salary
Group?
Surely the best thing to do, tax wise, is for the two businesses to merge under a single company group and/or for the engineering company to split apart amongst divisional lines.
There are lots of tax planning options there for you to look at.
NeilW