Director Salary

[NAR]

This is a great board, thanx for everyone's help.

I am currently preparing all my documents to apply for Tier 1 (Entrepreneur) 200K route. I am planning to actually register a proper Ltd company with the entire 200K as the share capital and be put in the business bank account.

I want to confirm that being a director of an Ltd company (even though I own all the shares), can I pay myself a reasonable salary from the business account? I do understand that i will pay TAX on this salary separate from the business TAX. While if i register myself as Self-employed person then my understanding i can't use the 200K investment to pay salary or living expenses for myself. Please correct me if my understanding is wrong.

[entrepreneur123]

1. For intial application, to keep things simple do not put money in business account.
2. yes ofcourse u can pay salary to yourself but you cannot claim it through 200k so better to pay urself through sales your company is making in both cases i.e director or self employed.

This is a great board, thanx for everyone's help.

I am currently preparing all my documents to apply for Tier 1 (Entrepreneur) 200K route. I am planning to actually register a proper Ltd company with the entire 200K as the share capital and be put in the business bank account.

I want to confirm that being a director of an Ltd company (even though I own all the shares), can I pay myself a reasonable salary from the business account? I do understand that i will pay TAX on this salary separate from the business TAX. While if i register myself as Self-employed person then my understanding i can't use the 200K investment to pay salary or living expenses for myself. Please correct me if my understanding is wrong.

[NAR]

Thank you for prompt reply.

1 - Yes, i meant after the approval and landing (i am applying from outside the UK)
2 - I think their guide is not really clear. They tell you we need you to show 200K (+ small maintenance) and you open and invest the money in a proper company. So if am moving myself + family with 2 kids to the UK to open a business, i really need 400K to start with assuming all the 200K should be left for the company for the next three years and another 200K for the family living expenses (including house rent & schools).

They want you to come over with 200K to open a business, but they don't expect you to live off this 200K initially (until the business starts making a profit). I do understand this is probably to prevent people who don't have genuine intention to open a proper business and just want to spread out the 200K over 4 years or so but i think the guide does need to be much more clear on this point.

[Jaggers]

This is a great board, thanx for everyone's help.

I am currently preparing all my documents to apply for Tier 1 (Entrepreneur) 200K route. I am planning to actually register a proper Ltd company with the entire 200K as the share capital and be put in the business bank account.

I want to confirm that being a director of an Ltd company (even though I own all the shares), can I pay myself a reasonable salary from the business account? I do understand that i will pay TAX on this salary separate from the business TAX. While if i register myself as Self-employed person then my understanding i can't use the 200K investment to pay salary or living expenses for myself. Please correct me if my understanding is wrong.

In my refusal HO raised concern because I only allowed less than £10000.00 annually, do some good research and allow reasonable salary to director of the company.

Good luck...