should we be closing businesses and reopening straight away to save NI

should we be closing businesses and reopening...

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should clients close their business, and reopen immediately in order to save the NI on first 10 employees?

What about Ltds formed, but not yet trading? Is there any anti-avoidance to stop this?

Presumably for established businesses it's not worth it, but I have 3 clients that opened within the last week, set up PAYE schemes etc but haven't yet paid employees? What should be done?

Andrew 

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By JCresswellTax
22nd Jun 2010 16:54

Guidance to follow

I don't think you will get detailed guidance on this for a few months, maybe September I recall ?

It is a question I was asking but surely there will be some anti avoidance measures put in place.

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By mikewhit
22nd Jun 2010 17:49

Good value

It would be good value for those under IR35 since typically a good ~10% of their deductions to tax would be Employers' NI.

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By aiwalters
22nd Jun 2010 18:59

righty-ho I'm off to form a new business or two

for various clients. Seems a shame to waste all that money on NI when starting again a day later will save £50000. 

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Wild Billy Hickok
By Wild Billy
23rd Jun 2010 06:53

I'd wait for the legislation and guidance before doing anything

I'm sure the taxpayer will be thrilled that our first thought is how we can take advantage of a scheme designed to support genuine start-ups. What a profession!

Before anyone does something silly like closing a business and starting again, they should read Rebecca's article. The chances of there not being anti-avoidance rules alongside this are zero.

https://www.accountingweb.co.uk/topic/tax/emergency-budget-employer-relief-businesses/433727

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By aiwalters
23rd Jun 2010 07:07

genuine
I wasn't talking about phantom startups, I was refering to genuine new startups where the company has been formed, registered for vat, payroll scheme set up, but not yet trading.

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