Invoicing myself to my company via and another

[Undirection]

I am director of a company (only a small Limited one) and am spending X amount of time running it with my business partner. I need to pay myself a small amount for my time (only about £1500) but don't want to have to employ myself there. Can I invoice one of my business partner's businesses and then get that one to invoice the business?

[jammy_basturd]

I'm no expert by any stretch, but invoices are for companies to receive payment - you'd still need to set up either a shareholding to receive dividends or employment to receive salary.

[PurpleMoonlight]

If you are a Director you are an employee.

You don't understand that?

[Eric Mc]

You cannot pay yourself as an "outside contractor" or for "services rendered" when you are a director of the company which is doing the paying. If you have supplied a service to your own company as a director, you must process that payment as a salaried amount - and carry out the necessary PAYE/NI calculations on that amount.

A director who is also a shareholder of their own company can draw money out of the company in the form of a dividend - subject to the usual caveats and restrictions that apply to dividends.

However, a dividend is a share out of company profits. It is not remuneration for doing work in or for the company.

[Undirection]

Ok, I understand that but the company invoicing is not mine and so can I invoice them for 'consultancy' and then they invoice my company for 'consultancy'? This way I am not invoicing my own company?

[malks222]

so you're asking if:

mr unidirection (personally) can invoice company X and they in turn invoice Unidirection Ltd for carrying out the work?

if so how would company X pay you for carrying out the work? would they just pay you as 'self employed/ sole trader'?? if so you'd need to declare this on a self assessment tax return and pay any tax/ ni associated with it.

i'm sure eric will be along in a minute to tell you otherwise, but i also dont think you can claim 'self employed/ sole trader' status if you are also the director of your own limited company. also are you employed PAYE by another company too?

[Jasandjules]

Surely as a director you are already employed. So you can either pay yourself the tax free amount each month until your target value or pay a dividend to your share class?

[jammy_basturd]

Jasandjules said:

Surely as a director you are already employed. So you can either pay yourself the tax free amount each month until your target value or pay a dividend to your share class?

This.

I'm not sure why you'd have two companies invoice each other. All that would achieve would be for two companies to swap monies. You still wouldn't receive anything personally.

[Eric Mc]

Undirection said:

Ok, I understand that but the company invoicing is not mine and so can I invoice them for 'consultancy' and then they invoice my company for 'consultancy'? This way I am not invoicing my own company?

Creating a carousel transaction to disguise the nature of the payment is called "fraud" I think.

[GuinnessMK]

Eric Mc said:

Undirection said:

Ok, I understand that but the company invoicing is not mine and so can I invoice them for 'consultancy' and then they invoice my company for 'consultancy'? This way I am not invoicing my own company?

Creating a carousel transaction to disguise the nature of the payment is called "fraud" I think.