Invest my ltd company funds?

[trowelhead]

Hello all,

I've been considering best options with company sitting on excess profits in cash.

Can i invest this in a shares account, and if so what providers offer business accounts?

As at the moment its earning quite possibly negative returns.

I'd like to invest it quite conservatively, perhaps 50/50 stocks bonds perhaps some gold and real estate too.

Let's say approx half short term (money market/bonds??) (accessible within 6-12 months) and half can be invested for the long term

Company only requires a small float to operate, and i already draw a decent income from it and fill personal isa - don't want to draw too much more personally as it becomes very tax inefficient

Thoughts gratefully received!

[trowelhead]

rockin said:

Personal opinion,

• Sell the company and pocket your Entrepreneur's Relief. [10% tax]

• OK, so you don't want to sell - have you stuffed your pension yet?

• Otherwise just pay it out as dividend, stop moaning about income tax and be grateful you've pocketed the cash before Comrade Corbyn takes over the reins...

Thanks, company is still trading, so assuming ER is a no go - or at least i'd rather "save" it for if i need to actually sell the business in the future...

Unless it can be claimed multiple times.

Or did you mean actually sell the company? Suppose that may be one way to go

As for pension, no but the limit is 40k isn't it? Plus due to my age (28) i am reluctant to lock away funds, and would rather use ISAs etc wherever possible to stay liquid. As you mention Corbyn etc - i'm a bit uneasy with the future of pensions re pension age extensions etc

And yes, i'm certainly no miser and pay plenty of tax on current drawings! I want to avoid what would likely be a 50/60% loss to tax if i draw when i'm already paying tax at higher brackets

Edited by trowelhead on Wednesday 14th March 08:41

[trowelhead]

Jockman said:

Is your pension allowance used up? Is your wife’s allowance used up too?

For no risk option we transfer to a Cambridge & Counties 30 day savings account at 1.3%.

No assets need replacing?

No it is not used up, sadly no wife either or she could be drawing a dividend, use her isa etc.

That looks good, i'll look into the C&C option! Is that in personal name or business?

[trowelhead]

98elise said:

Why not extract it as a directors loan and invest it yourself. You need to pay interest (3% IIRC).

I take a loan and stick it in my mortgage offset. Effectively my company is making 3% instead of the mortgage company

That's a good idea, is that possible long term, i thought that triggered a 25% company tax charge (can't remember it's name) on overdrawn accounts.

If it's possible long term then i'll probably do this!

[trowelhead]

98elise said:

Why not extract it as a directors loan and invest it yourself. You need to pay interest (3% IIRC).

I take a loan and stick it in my mortgage offset. Effectively my company is making 3% instead of the mortgage company

Oh - and offset mortgage is a great idea. Never had one, are your funds guaranteed as liquid / withdrawable on short notice?

Looking to move to a new place in next couple of months, so will chat to sarnie about this as an option...

[trowelhead]

Long term loans thing sounds good - might have to ask my accountant on thoughts about this.

Also - if i open a pension, can i do a regular SIPP via HL - and my company pay directly into that

Or do i need something more complex e.g SSAS etc?

[trowelhead]

vindaloo79 said:

All claims to this exemption must be dealt with by an Inspector (see EIM26152). Experience shows that few cases meet the tests set out below.

I generally feel less contact I have with tax inspectors the less hassle and time I am going to have with them. I don't have any clue if it is a formality getting these kind of things agreed

Edited by vindaloo79 on Wednesday 14th March 13:53

I agree - don't fancy it much on that basis ha ha

[trowelhead]

98elise said:

trowelhead said:

Long term loans thing sounds good - might have to ask my accountant on thoughts about this.

Also - if i open a pension, can i do a regular SIPP via HL - and my company pay directly into that

Or do i need something more complex e.g SSAS etc?

I have a regular H&L SIPP and pay direct from my company. My accountant said this was the best way to do it.

Cheers, going to get that setup today

[trowelhead]

Been looking into this again recently.

Want to invest ltd co surplus but not lock into a pension.

Found this article, seems in short you can setup another ltd co - inter company loan, setup share account and invest...

https://www.foxymonkey.com/how-to-invest-your-comp...