Director exchanging assets with own company.

by **metatron** on Thu Jan 12, 2012 3:58 pm

Hi Folks,

I am considering setting up a company in which I will be the director, sole employee and shareholder.

If I put money into the company to start it up can I simply take this money back at a later date? What about tools and computers that I own now that the company will use? Could I sell them to the company?

HMRC says( http://www.hmrc.gov.uk/ct/managing/director-loan.htm )

If you're a company director or 'participator' and take money out of your company that's not a salary or a dividend - over and above any money you've put in - you're classed as having received the benefit of a director's loan.

So I am assuming as long as I'm not overcharging for things I'm selling to my company this is legal.

Any feedback is greatly appreciated

by **pawncob** on Mon Jan 16, 2012 7:04 pm

If you lend money to the company or sell it goods for which it doesn't immediately pay you, it's a loan to the company. It's your money and you can withdraw it at any time.

ALL other payments from the company to you are subject to tax.

by **metatron** on Mon Jan 16, 2012 10:02 pm

Thanks for the reply pawncob

I was just trying to work the most tax efficient way that's all. By selling goods to the company money is in my pocket and the company has tax deductible receipts for goods too. So it's a win win

This is going to be especially helpful as I'm going to be taking a tiny salary to start.

Thanks again.