Hello,
Hopefully somebody can answer this one easily, I can't find the answer on hmrc website:
I know that company directors are required to file an SA tax return, but what about a company director who has no income (salary or dividends) from his company?
Does he need to file a tax return showing his income from his other employment (he's not a director of that one)?
And if so, does he then complete another Employment page for his own company showing Nil salary?
Thanks in advance
BD
Replies (8)
Please login or register to join the discussion.
Only if one is issued
The general rule is that a tax return must be completed if tax is owed, or if one has been issued.
HMRC stance is that they like to issue returns to company directors, and often trawl through Companies House records to identify them.
But, if HMRC have not sent a tax return, there is no legal obligation for the director to prepare one, unless of course the monies they have extracted creates a tax liability.
SA150
The guide to completing the tax return tells you how to disclose employments/directorships where there is no income. See section 1, Employment.
http://www.hmrc.gov.uk/worksheets/sa150.pdf
You won't need to have employment pages regarding the directorship with no income/benefits but you will need to disclose it at the Additional Information section.
As Chris08 suggested, HMRC issuing a return does not mean it must be completed.
Requirement to submit
As Chris08 suggested, HMRC issuing a return does not mean it must be completed.
I think you have that the wrong way round. The only time you are required to submit a tax return is when HMRC have given you notice to do so, If HMRC do not send a return you have no obligation to complete one, but you do have an obligation to tell them if you are liable to pay additional tax.
If a return is issued it must be completed.
You are under no obligation to complete one if none is issued and you owe no additional tax.
And remember
That in spite of what hmrc states on its website there is no statutory requirement for a director to submit a return
What I meant
Is that HMRC sometimes issue notices to complete a tax return incorrectly.
If they do that, they can be cancelled.