Sorry I wasn't very clear in my initial question. He wants to ultimately just have the one company, by selling company B to company A, hiving up the trade and assets of company B, then striking off B.
The additional complications arise from Inter company loans from B to A and whether it is a share for share exchanges, or a cash sale.
I haven't gone into too much detail, as the intention is to engage somebody more experienced than myself to go through the detail.
The client (and I) are around the Lincs/Notts border, but I'll bear in mind the recommendation if they can deal remotely. I hope it will be a quick enough job which doesn't require any extensive face to face discussions.
Thanks Paul, I'll check it out. I've had a play with Google Drive and that seems fairly easy, though having digital signatures might be nice. It really comes down to which is the easiest for my clients to use.
Thanks for your responses.
I looked at MyDocSafe and it seemed like it would cost about as much as the practice management software I was looking at but for just the documents element.
I'll have to have a play with the Google Drive options - I currently pay for it anyway (not that it costs much) so I might as well take advantage.
Paul - Iris Openspace - is that a free trial, or indefinitley? Is it just free for Iris customers? I wouldn't have associated Iris with a free product, unless it's a loss leader to try to sell you their other products.
Plus they explicitly pointed out the additional personal tax cost for the waiver option, but didn't bother for the dividend!
It would appear they are working on the assumption that the director would need to draw the funds to pay the additional tax as well. This is not an unreasonable assumption as, if he had the spare funds, it would be more tax efficient to pay those spare funds into the company and reduce the amount of taxable dividend declared.
That's also a good point I hadn't considered. I think I'm too used to dealing with small companies with dividends that are only taxed at basic rate. I still think their model answer could have been more clear mind!
Never mind I've twigged it, they are suggesting physically paying a dividend, then the director making a physical transfer of the cash back to the company. They are obviously thinking in terms of a discrete one off (or in this case two off) loan, rather than something akin to a directors current account and not jsut crediting a dividend to the DLA, which in practice is how most of these small companies would likely operate. Curse the perfect little world of the exam question!
My guess would be that in referring to the "credit" the IFA probably had in mind that there was salary put through payroll sufficient to give a years credit for contributory benefits purposes, but it's possibly (s)he was referring to the maxima.
One more thing...
One thing you didn't ask about and I didn't mention before is the possibility of annual maxima applying - if he had other employment before December and paid a lot of NI in that employment he could be due a refund under the annual maxima rules.
He won't be due a refund, assuming your software now has the correct details in the corrected NI payment will be the final figure.
Director's NI thresholds are pro-rata for the year in which they become a director, so in this case something around 1/3 to 1/4 of the primary and secondary thresholds (UEL will also be pro-rata, but I don't think that is the one you meant in this case), leaving £4-5k subject to NI, as I imagine your software has calculated.