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Company director with second employment elsewhere

Company director with second employment elsewhere

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Hello, so a limited company director is currently planning to pay themselves £670 per month salary from own company (Empt Allow would not be of benefit).

They have now found another employed job elsewhere earning £7,280 PA but the company will continue. Could their own company therefore reduce the planned salary to £3,720 PA giving them total employment earnings of £11,000 but without any NI deductions from either employment?

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By JCresswellTax
30th Mar 2016 16:44

Yes

.

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By chewmac
30th Mar 2016 18:18

Definitely no aggregation of NI for directors?
Thank you very much but can I just check that there is no aggregation of national insurance for directors? This link refers to related employments but I have in mind that in one way or another something similar applies to directors: https://www.gov.uk/guidance/what-to-do-if-your-employee-has-more-than-1-job , hopefully I'm wrong. Thanks

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By zebaa
30th Mar 2016 19:23

Thinks

I think you are wrong. Happy now?

 

 

And JC is correct.

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By chewmac
30th Mar 2016 23:35

Happy to be wrong
Thanks

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By stephenkendrew
31st Mar 2016 07:59

No aggregation

as long as the employers are not related.

But, it may be beneficial to keep paying them an annual salary of £8K.

Whilst they will have tax to pay on just over £4K of their salary, the company gets tax relief so the overall tax effect is neutral. They will, however, get a net salary of about £3.5K, which will avoid dividend tax. 

 

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By chewmac
31st Mar 2016 11:40

That's an excellent planning tip, thank you

stephenkendrew wrote:

as long as the employers are not related.

But, it may be beneficial to keep paying them an annual salary of £8K.

Whilst they will have tax to pay on just over £4K of their salary, the company gets tax relief so the overall tax effect is neutral. They will, however, get a net salary of about £3.5K, which will avoid dividend tax. 

 

That's an excellent planning tip, thank you

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