MONEY IN COMPANY BANK ACCOUNT

by **pritchard** on Fri Jan 13, 2012 5:16 pm

Suppose I have £100k in the company account. Can simply withdraw my Personal Tax Allowance from it annually, over say 10years, and thus pay no income tax or is there a Corporation Tax liability please.

by **section 44** on Fri Jan 13, 2012 5:31 pm

Beneficially, does the money belong to you or the company? If the former then why is it held by the company, if the latter then what does this money represent (e.g. capital, profits etc).

by **King_Maker** on Sun Jan 15, 2012 12:22 pm

You may be able to withdraw it as salary - tax could be due depending on your overall position for the relevant tax year.

Dividends could be used in addition or as an alternative, depending on whether the company has sufficient distributable reserves.

What does your accountant think?

by **pritchard** on Wed Jan 18, 2012 9:43 am

section 44 wrote:Beneficially, does the money belong to you or the company? If the former then why is it held by the company, if the latter then what does this money represent (e.g. capital, profits etc).

The money is company earnings from services offered to cliets. It has not been subjected to Corporation Tax so far.No income tax has been paid on it.

by **pritchard** on Wed Jan 18, 2012 10:08 am

King_Maker wrote:You may be able to withdraw it as salary - tax could be due depending on your overall position for the relevant tax year.

Dividends could be used in addition or as an alternative, depending on whether the company has sufficient distributable reserves.

What does your accountant think?

have no accountant. My overall position is simply OAP + say £2500 annually from this company account. Keeps me below my tax threshold.

No other income.

by **Generix** on Wed Jan 18, 2012 12:19 pm

pritchard wrote:
King_Maker wrote:You may be able to withdraw it as salary - tax could be due depending on your overall position for the relevant tax year.

Dividends could be used in addition or as an alternative, depending on whether the company has sufficient distributable reserves.

What does your accountant think?

have no accountant. My overall position is simply OAP + say £2500 annually from this company account. Keeps me below my tax threshold.

No other income.

I assume when you say 'company' then you mean a Ltd company bank account of which you are a director/owner? rather than a sole prop business bank account seperate to your personal account?