The new anti avoidance rules on the closure of a small Limited Companies aim to treat the final distribution as income (dividend) rather than as a capital gain which generally would mean increased tax bills at that point.
Just wondering if there any tips or hints for planning round this?
One of the attractions of a Ltd Company it seemed to me was the ability to roll up profits within the Company and then when it closed the final distribution could be treated as a capital gain.
I believe this is no longer the case.
Small Limited Companies can still time the distribution of profits so dividends are only distributed so that the tax payer stays within lower rates of income tax and pension contributions could be made.
Are there any other ideas for planing to consider?
It seems to be getting to the point where the tax advantages of a small limited company are fast disappearing.