I'm intrigued, C, by your reference to QUOTE a leading case involving an architect that creditors can pierce the limited liability veil, the rule is you have to exercise a reasonable level of skill and care as a director , and if not the creditor can sue you personally ENDQUOTE and wonder if your could please set out the case name as far as you remember it, please?
Incidentally, I found the following Herbert Smith note https://hsfnotes.com/litigation/2013/06/13/supreme-court-confirms-corpor... led me to some amusements, and I thank you in advance for your kind help in this allegedly murky area ...
As the preparation of "dormant company" accounts should be easy, and there fore not be a significant cost/s to contractor with some simple training from their soon-to-be ex-accountant/s to be offered as a goodwill/marketing gesture to a possible future client, then surely going "dormant" is the way ahead?
And here's something for "free": as part of your marketing ... to a possible future client ... why not suggest this including wording as a "NOTE (A)" under for example micro-entity "Advances etc" to Companies House:
NOTE (A): The accounts have been prepared in accordance with the micro-entity provisions applicable to companies subject to the small companies regime. Directors declaration: During the period ended DD MM 20XX the company made 'no significant financial transactions', qualified as a 'micro-entity', only paid a £13 Confirmation Statement filing fee to Registrar of Companies, hence had been 'dormant' in accordance with Companies Act 2006 section 1169 (3) (b)(iv).
FWIW: OP might consider having a NOTE to the effect of :
During the period ended XX YYY 201Z the company made 'no significant accounting transactions', qualified as a 'Micro-entity', only paid a £13 Confirmation Statement (Form CS01) filing fee to the Registrar of Companies, hence had been 'dormant' in accordance with section 1169(3)(b)(iv) of the Companies Act 2006.
1.5.4 There are additional complications if the volunteer is also an office-holder; for example, a director of a charity incorporated as a company limited by guarantee. The HMRC Employment Income Manual states that the same principles regarding the reimbursement of expenses apply to office-holders as to other volunteers. The guidance goes on to say that if the sums involved are small, HMRC should not spend time examining the extra expenses that they incur as a result of holding office. However, the guidance then states that this only applies to „small‟ amounts of travelling and subsistence payments. If the reimbursements to office-holders amount to £8,500 or more per tax year (calculated on a source-by-source basis unless those sources can be linked), they will be treated as earnings by virtue of ITEPA 2003 section72.13
1.5.5 Therefore, even if unpaid, the office-holder risks being taxed on expenditure incurred as a result of the voluntary activity. This may be a sobering thought to those who incur high travel costs.
ENDQUOTE
Can any one out there advise me please if the above reference to ITEPA 2003 section72. etc is (A) correct, and/or (B) current, please ?
@Euan MacLennan:Do u have link for ... the current consultation?
Euan MacLennan wrote:
... Unless HMRC does a complete U-turn on the current consultation, the requirement to report the reimbursement of business expenses and with it, dispensations, will be abolished in the near future.
Do you have a website e- link for ... the current consultation, please?
@Euan MacLennan & @lionofludesch:Thanks BUT houses are needed
@Euan MacLennan & @lionofludesch: Thanks both, BUT houses are needed to be built in the UK, especially for GENERATION RENT, and I fail to see how the latest "CIS tax" arrangements help encourage any young UK based subby starting out to make a business plan, and work to it !
Unless, of course, you're based outside the UK, and can leave the UK whenever the HMRC appear in view.
All this seems to me to fail to encourage UK GDP productivity, due to an impossible to understand tax regime by a skilled bricklayer, skilled plasterer, etc - who may possibly have an IQ < 100 - unless I've misunderstood the tax situation.
@Euan MacLennan: Does the company have a 20% deduction?
Euan MacLennan wrote:
... Hence, self-employed CIS subbies either had to change to being employees or incorporate their own company.
Sorry to have to ask this, but ... Does the [CIS subby's own incorporated] company have a "CIS tax" 20% deduction made on its invoices to the main contractor, before receiving any payment/s, please ?
My answers
So try webpage:
https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim32825
I'm intrigued, C, by your reference to QUOTE a leading case involving an architect that creditors can pierce the limited liability veil, the rule is you have to exercise a reasonable level of skill and care as a director , and if not the creditor can sue you personally ENDQUOTE and wonder if your could please set out the case name as far as you remember it, please?
Incidentally, I found the following Herbert Smith note https://hsfnotes.com/litigation/2013/06/13/supreme-court-confirms-corpor... led me to some amusements, and I thank you in advance for your kind help in this allegedly murky area ...
As the preparation of "dormant company" accounts should be easy, and there fore not be a significant cost/s to contractor with some simple training from their soon-to-be ex-accountant/s to be offered as a goodwill/marketing gesture to a possible future client, then surely going "dormant" is the way ahead?
And here's something for "free": as part of your marketing ... to a possible future client ... why not suggest this including wording as a "NOTE (A)" under for example micro-entity "Advances etc" to Companies House:
NOTE (A): The accounts have been prepared in accordance with the micro-entity provisions applicable to companies subject to the small companies regime. Directors declaration: During the period ended DD MM 20XX the company made 'no significant financial transactions', qualified as a 'micro-entity', only paid a £13 Confirmation Statement filing fee to Registrar of Companies, hence had been 'dormant' in accordance with Companies Act 2006 section 1169 (3) (b)(iv).
I agree with that.
FWIW: OP might consider having a NOTE to the effect of :
During the period ended XX YYY 201Z the company made 'no significant accounting transactions', qualified as a 'Micro-entity', only paid a £13 Confirmation Statement (Form CS01) filing fee to the Registrar of Companies, hence had been 'dormant' in accordance with section 1169(3)(b)(iv) of the Companies Act 2006.
Watch out if reimbursements > £8,500 pa ?
This link: http://www.litrg.org.uk/Resources/LITRG/1_663_LITRGvolunteersexpensesrep... seems to me to imply potential problems in its para 1.5.4 and 1.5.5 :
QUOTE
1.5.4 There are additional complications if the volunteer is also an office-holder; for example, a director of a charity incorporated as a company limited by guarantee.
The HMRC Employment Income Manual states that the same principles regarding the reimbursement of expenses apply to office-holders as to other volunteers. The guidance goes on to say that if the sums involved are small, HMRC should not spend time examining the extra expenses that they incur as a result of holding office. However, the guidance then states that this only applies to „small‟ amounts of travelling and subsistence payments. If the reimbursements to office-holders amount to £8,500 or more per tax year (calculated on a source-by-source basis unless those sources can be linked), they will be treated as earnings by virtue of ITEPA 2003 section72.13
1.5.5 Therefore, even if unpaid, the office-holder risks being taxed on expenditure incurred as a result of the voluntary activity. This may be a sobering thought to those who incur high travel costs.
ENDQUOTE
Can any one out there advise me please if the above reference to ITEPA 2003 section72. etc is (A) correct, and/or (B) current, please ?
Thanks in advance for your help.
Very int on O 365
Thanks!
@Euan MacLennan:Do u have link for ... the current consultation?
Do you have a website e- link for ... the current consultation, please?
@ lionofludesch: My apologies. Thanks for the info.
My apologies. I didn't intend to get at you, in any way.
I'm not very well briefed on CIS, and I wish to thank you for your info that you've kindly set out for me.
@Euan MacLennan & @lionofludesch:Thanks BUT houses are needed
@Euan MacLennan & @lionofludesch: Thanks both, BUT houses are needed to be built in the UK, especially for GENERATION RENT, and I fail to see how the latest "CIS tax" arrangements help encourage any young UK based subby starting out to make a business plan, and work to it !
Unless, of course, you're based outside the UK, and can leave the UK whenever the HMRC appear in view.
All this seems to me to fail to encourage UK GDP productivity, due to an impossible to understand tax regime by a skilled bricklayer, skilled plasterer, etc - who may possibly have an IQ < 100 - unless I've misunderstood the tax situation.
@Euan MacLennan: Does the company have a 20% deduction?
Sorry to have to ask this, but ... Does the [CIS subby's own incorporated] company have a "CIS tax" 20% deduction made on its invoices to the main contractor, before receiving any payment/s, please ?