250K Business/Investment ideas?
Discussion
I've got a lump sum of cash £250k sat within a dormant Ltd Co. that i'd like to do something with. If I extract the funds personally it attracts income tax penalties, so i'm therefore toying with ideas of setting up another business or investment strategy. Obvious ideas such as a BTL property portfolio spring to mind, but i know that there are tax issues doing it through a Ltd Co.
It will be interesting to put it to the floor and see what others would do? I expect many Petrolhead based business ideas, but would they yield a satisfactory ROI?
It will be interesting to put it to the floor and see what others would do? I expect many Petrolhead based business ideas, but would they yield a satisfactory ROI?
I've got a lump sum of cash £250k sat within a dormant Ltd Co. that i'd like to do something with. If I extract the funds personally it attracts income tax penalties, so i'm therefore toying with ideas of setting up another business or investment strategy. Obvious ideas such as a BTL property portfolio spring to mind, but i know that there are tax issues doing it through a Ltd Co.
It will be interesting to put it to the floor and see what others would do? I expect many Petrolhead based business ideas, but would they yield a satisfactory ROI?
It will be interesting to put it to the floor and see what others would do? I expect many Petrolhead based business ideas, but would they yield a satisfactory ROI?
Remster500 said:
I've got a lump sum of cash £250k sat within a dormant Ltd Co. that i'd like to do something with. If I extract the funds personally it attracts income tax penalties, so i'm therefore toying with ideas of setting up another business or investment strategy. Obvious ideas such as a BTL property portfolio spring to mind, but i know that there are tax issues doing it through a Ltd Co.
It is generally seen as better to do BTL through a company if you are into the 40% bracket personally, what other tax issues are you aware of?Thanks for the useful input chaps.
I had originally thought about extracting the cash by winding the business up and claiming ER at 10%. However, my accountant has advised that the criteria for claiming this relief has tightened in recent years and that I'm unlikely to qualify. I am still a little unsure about this as I have friends with businesses who have successfully claimed in similar circumstance. I forget all the in's and outs about qualifying. To give a little background, the companies last sales transaction was 9mths ago but continues to have x2 Director/Shareholders (me & wife). I initially sold part of the business as a going concern and then disposed of the remaining assets, including property. I have extracted some cash by way of salaries & dividends and will continue this in current tax year. Pension contributions have also been used. There are also x2 £30k redundancy payment allowances to be made. All this will still leave circa £250k in the account to be used or removed.
This is why I'm thinking of other business ideas if extracting the funds tax efficiently isn't an option.
I had originally thought about extracting the cash by winding the business up and claiming ER at 10%. However, my accountant has advised that the criteria for claiming this relief has tightened in recent years and that I'm unlikely to qualify. I am still a little unsure about this as I have friends with businesses who have successfully claimed in similar circumstance. I forget all the in's and outs about qualifying. To give a little background, the companies last sales transaction was 9mths ago but continues to have x2 Director/Shareholders (me & wife). I initially sold part of the business as a going concern and then disposed of the remaining assets, including property. I have extracted some cash by way of salaries & dividends and will continue this in current tax year. Pension contributions have also been used. There are also x2 £30k redundancy payment allowances to be made. All this will still leave circa £250k in the account to be used or removed.
This is why I'm thinking of other business ideas if extracting the funds tax efficiently isn't an option.
Edited by Remster500 on Tuesday 6th June 10:06
How does the redundancy thing work then?
I find myself in a similar situation. There will hopefully be a decent sum of cash in business account by the time I sell all business assets. And now looking for ways of efficiently drawing it down.
At present I have a PAYE job with a separate company. I used to receive a salary from my business. My wife still receives a salary from my business. She's been with the business greater than 2 years.
I own all the shares
Can I make myself and wife redundant and pay out 30k each? If so, are there any other costs to the business of doing this? I know employee NI and paye kicks in when the payout is >30k.
I've googled but can't find definitive answers
I find myself in a similar situation. There will hopefully be a decent sum of cash in business account by the time I sell all business assets. And now looking for ways of efficiently drawing it down.
At present I have a PAYE job with a separate company. I used to receive a salary from my business. My wife still receives a salary from my business. She's been with the business greater than 2 years.
I own all the shares
Can I make myself and wife redundant and pay out 30k each? If so, are there any other costs to the business of doing this? I know employee NI and paye kicks in when the payout is >30k.
I've googled but can't find definitive answers
MrJuice said:
How does the redundancy thing work then?
I find myself in a similar situation. There will hopefully be a decent sum of cash in business account by the time I sell all business assets. And now looking for ways of efficiently drawing it down.
At present I have a PAYE job with a separate company. I used to receive a salary from my business. My wife still receives a salary from my business. She's been with the business greater than 2 years.
I own all the shares
Can I make myself and wife redundant and pay out 30k each? If so, are there any other costs to the business of doing this? I know employee NI and paye kicks in when the payout is >30k.
I've googled but can't find definitive answers
The current Redundancy allowance is unto £30k max per employee. This amount can be paid either statutory based on number of service years or can be paid ex-gratia up to the £30k max if the company decides to do so. The employee/directors position must have genuinely become redundant or the company has ceased trading. Redundancy payments up to £30k are not subject to tax or NIC. I find myself in a similar situation. There will hopefully be a decent sum of cash in business account by the time I sell all business assets. And now looking for ways of efficiently drawing it down.
At present I have a PAYE job with a separate company. I used to receive a salary from my business. My wife still receives a salary from my business. She's been with the business greater than 2 years.
I own all the shares
Can I make myself and wife redundant and pay out 30k each? If so, are there any other costs to the business of doing this? I know employee NI and paye kicks in when the payout is >30k.
I've googled but can't find definitive answers
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