I know that when advising clients on how to structure salary and dividend levels the most efficient way is to get them to pay a salary part way between the first 2 NIC levels such that they get an NIC contribution on their record but don't have to pay any NIC. I also know that doing this can cause problems if a director wants a mortgage or a pension later on.
Am I the only one out there that fells uncomfortable advising every time that directors structure their pay in this way? The majority of my company clients are one-man bands often generating in excess of £100k for their companies. It almost seems like they are asking for trouble from HMRC if they take a salary of between £5 and £6k with the rest as dividends (after CT is withheld of course). Has anyone experienced HMRC trying to argue that the dividend payments should be in fact re-classified as salary?