Tax position on Share Distribution
A Client of mine has a number of shareholders, one of which owned 200 shares (out of 1040 issued) and was no longer involved in the business. After nearly 10 years they managed to buy these shares back for £8000, which was paid by the Company.
They want to give these shares to the sole Director who currently owns 20 shares.
The share's have a nominal value of £1.00 each.
My understanding is that this gift of shares would be the equivalent of a cash payment of "net" £8000 and PAYE and NI would be payable on a grossed up figure.
Does anyone have a solution that doesn't involve this expensive route? We did look at cancelling and then reissuing new shares but again, my understanding is that there would be PAYE/NI liable on the difference between purchase and real value so no benifit there.
Thanks in advance
- Data Protection and emailing documents 1,081 14
- Goods Purchased for Rental 463 26
- Taxfiler V's BTC 572 22
- Why do HMRC have a different FPS liability to the amount I sent? 1,960 25
- Does anyone have a formula to compare employment to self-employment rates? 409 8
- accounts & tax software for small accountancy firms 737 25
- Valuation of business 294 5
- CGT implications for gift of shares to connected person 148 7
- Dividend Payments 398 10
- I.d for vat registration 157 7
- Capital allowances anti-avoidance 127 4
- builder's 'cost only' job 155 1
- Myfirmsapp 624 13
- Filing past due corporation tax returns 279 1
- Completing Self-Assessment for a Director of Owner Managed Business 174 3
- CIS Deductions 134 2
- SA302's anyone?? 2,690 40
- Accounting for VAT not yet paid in year end 171 3
- Loan to Partnership is s455 tax relevant? 484 17
- Legal Counsel PC costs 90 1
- Nil Rate Band Trust - index linked debt by way of charge over property 1,009
- International interest certificate 588
- Have we escaped Gift with Reservation of Benfit & Pre-owned asset charges? - Gift after benefit 512
- NOVA 470
- Bonus Bonds 355
- Insolvency and whistle blowing 333
- Transfer of funds into recently set up company 257
- Payment for Promotional Samples 227
- TPR imposes first penalty notice fines 222
- Quickbooks 2015 152