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Salary, attachment of earnings & dividends

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Hello,

I have a director who has monthly drawings between £2000-£7000. Also he has attachment of earnings. Normally I would do annual salary around Personal Allowance level and rest would be as dividends. But as this is my first client who has drawings in such a high volumes I am not sure if I should increase his salary. But if I increase his salary then deductions will be higher as at the moments attachments are not attached to dividends.  Any advice appreciated. Thanks

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By Matrix
03rd Jun 2019 21:01

As an employer he has to process the earnings attachment and pay over the amounts deducted. If the net pay is then less than normal but his drawings are the same, then the dividends declared will need to be increased.

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RLI
By lionofludesch
03rd Jun 2019 21:40

What's the question here ?

Is it how to save tax ? Or how to avoid paying a court ordered debt ?

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Replying to lionofludesch:
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By krix_wm
04th Jun 2019 09:11

Neither. Just to make both worlds happy :)

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By jcace
03rd Jun 2019 23:41

Bear in mind that if you operate the payroll, you should only be doing so on the instructions of your client and not making decisions on levels of pay yourself. By all means advise the client, but let him make the decisions based on your advice.

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By JCresswellTax
04th Jun 2019 09:17

It sounds like you are trying to deal with things after the events?

Surely you must know at the time what the drawings relate to?

You don't just create a dividend minute on 5th April for the balance that isn't salary do you?

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By krix_wm
04th Jun 2019 10:28

Of course I know - company's bank account is treated as ATM, and drawings are taken for private use. Not sure if i should ask for any details.
And no, I don`t do minutes for 5th April.

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