tax tips – Page 3 – Minerva Accountants Bristol and Somerset

July 10, 2023July 20, 2023

Tax Tip

Entertaining your employees is quite common at Christmas and other times of the year. It’s another tax free benefit for your team provided that certain conditions are met.

• It must be open to all employees
• It must be an annual event, such as a Christmas party or Summer barbecue
• It must cost less than £150 per person. If the cost is over £150 then the FULL AMOUNT becomes taxable and not just the part above £150.
• You can have more than one event per year to make up the £150 as long as the combined cost stays below this limit

June 26, 2023June 16, 2023

Tax Tip – Don’t let your DLA (director’s loan account) get overdrawn

The company must pay tax on overdrawn loan accounts if not repaid within 9 months of the year end (and there are clauses that stop you repaying and immediately withdrawing!)

If the amount is over £10,000 then the individual director will have to pay a tax on the ‘benefit in kind’ of a beneficial loan

So please check your management accounts before taking money out of the company and ensure that you leave enough in to pay VAT, corporation tax, and any other bills.

June 19, 2023June 11, 2023

Tax tip – interest on your director’s loan account

If you have put money into your limited company that has not yet been repaid then you can pay yourself interest on this loan. This can be a tax efficient way to take money out of the company BUT you would need a CT61 form completed for HMRC each quarter.

If you’re interested then please contact us for further information.

If, on the other hand, you have borrowed money from your company then you may face a higher tax charge and even a personal tax charge. We have software to help you plan your dividends.