Thank-you payment to long-standing service provider

Thank-you payment to long-standing service...

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Consider a small company (basically personal service style) that will be winding-up informally in the near future.

The company has very little in the way of assets / reserves (less than £20,000, which is substantially cash at bank) and virtually zilch in the way of liabilities. The reserves will, substantially, be distributed before / during the winding-up.

However, the company is also considering making a payment, by way of a thank-you, to the self-employed accountant that has dealt with the company's affairs for the last 25 or so years. Any suggestions as to the best way to arrange such a payment in these circumstances (including in the light of taxation and company accounts)? It is unlikely that the company will have sufficient profits against which and such payment can be offset (for the purposes of minimising tax).

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James Reeves
By James Reeves
14th Apr 2015 14:17

Suggestion

Why not ask the self-employed accountant?

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Replying to Chris Ash:
By mwngiol
14th Apr 2015 14:33

Gift

James Reeves wrote:

Why not ask the self-employed accountant?

Great advice unless they want it to be a surprise :p

Doesn't that new bribery act thing come into things somewhere?

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By JCresswellTax
14th Apr 2015 16:19

I think ebatch

May very well be that self-employed accountant!!

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Replying to SteveHa:
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By ebatch
14th Apr 2015 17:42

Accountant indeed ;-)

JCresswellTax wrote:

May very well be that self-employed accountant!!

- Very droll. I've been mistaken for a lawyer and a banker (and many years ago as Noel Edmonds - but we won't go there), but never before as an accountant.

 

I did try asking him (in a roundabout way) and he kept coming back to the concept of an ex-gratia payment, but also that he thought only ex-employees could be given an ex-gratia payment. And we sort of got stuck there.

 

I'd like the company to make the payment (only because he has dealt solely with the company affairs, not mine) but I wonder whether I'll end up personally making a "gift". But the spectre of "bribery" or some other foul deed seems to have now raised its head.

 

 

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