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Moving money from Ltd company w Joint ownership

I own a third share in a business. I would like to move some of ‘my profit’ into a new company

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Hi

I set up a limited company three years ago with two friends. We each own 33%. The profit is way beyond our expectations and each month we split 'our share' available for us to pull a dividend into a side account of the business. Effectively keeping all the money in the business but earmarking an amount for each of us as our own which we can pull as a dividend when we like. Due to not wanting to exceed the 100k mark per tax year for dividend and salaries we've each kept a large portion of this in the business to pull out at a later date. I currently have around 150k available in my 'side pot' ready to do what I like with. Instead of pulling out all this money and paying a huge amount to do so. I thought I might set up a separate company and move my amount into that business in order that I can Invest it privately in property or similar. The other two share holders would not object to this happening. Would a business loan be the best course of action here? Would moving 'my allocated amount' of money from the business protect it in anyway so that it is now under my sole ownership? Anything else I've not thought of? Any advice would be really helpful.

thanks 

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By Accountant A
15th Jun 2020 20:24

67rc

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By Chris1987
27th Apr 2020 17:34

Thanks, I’ve got onto my accountant now. I was hoping to see what options were available to me independently but if the complexities are too great then I shall be led entirely by his advice. Thanks

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By Accountant A
15th Jun 2020 20:24

086r 6cr

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By bernard michael
27th Apr 2020 13:51

How are the 3 pots shown in the accounts ??

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By andrew1211
27th Apr 2020 14:15

On an Excel spreadsheet I imagine!

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By Chris1987
27th Apr 2020 17:33

Hi

The three ‘pots’ are in separate accounts held by the business (not each shareholder) so all cash remains the property of the business until a dividend is declared and an amount is withdrawn. The separate accounts serve to show each shareholder how much they have available to them as per our own agreement but until the dividend is declared is cash at the bank owned by the business.

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By BromleyBob
28th Apr 2020 09:04

When you say, "separate accounts" do you mean separate bank accounts or accounts in the books?

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By Wanderer
27th Apr 2020 13:53

Also if your 'pot' is moved sideways like this it may well be that this makes it impossible for the other shareholders to take their 'pots' by way of dividends.

On figures such as this it will be worth taking some proper, paid for, advice.

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By John R
27th Apr 2020 14:40

If the company declared a dividend that each shareholder could draw down at will then it was made available at that time. It was therefore taxable at that time, not when it is eventually drawn!

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By Chris1987
27th Apr 2020 17:30

Hi John

Thanks for your reply. Dividends are not declared at that point, only when they are withdrawn out of the business. Essentially until that point all money belongs to the business and it is an internal agreement which governs who has what amount available to them.

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By johngroganjga
28th Apr 2020 16:06

You can't move your "pot" out of the company and into a new one, because as you say above "all money belongs to the business" (meaning company). For you to be able to move it it is has to become yours first, doesn't it?

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