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So far, the best your personal earnings can be is 13150 not 16500. You need to either generate a P60 for that amount or create a dividend slip. Again, you can not earn more than 13150Imran123456 wrote:I am bit confused and I really need help to clear some doubts regarding my self employed earning through limited company. I would be grateful if you please help me to get it right.
I have to show 16500 pounds as my earnings from my own limited company. I am the sole director and shareholder of the company.I kept all my earnings in the company's bank account and did not drew any salary or any dividend from the company's account to my personal account.
My accountant has prepared my company's accounts which shows the following figures:
Turnover: 22500
Administrative expenses: 6000
Ordinary profit on ordinary activities
before taxation/Net profit 16500
taxation on ordinary profit 3350
Profit after taxation 13150
There is also a balance sheet ofcourse. He has not declared any dividend.
Now the question is would it be acceptable with the accompanied accountant letter confirming net profit. I believe it is sufficient as per the guidance which says "Self-employed earnings within a business or company structure:
If an applicant has worked in a self-employed capacity in his/her own business or company structure and has chosen to keep his/her earnings within the business or company, he/she could provide:
business or company accounts that meet
• statutory requirements and show the net profit made for the earnings period claimed; and
a letter from his/her accountant confirming • the details in those accounts.
Please advise me if it is right or in case it is wrong what should I need to do. I would be grateful if anyof you could be of any help and could you please kind enough to give a sample of accountant letter as well .
Thanking you in anticipation
Imran
Dear John,John wrote:Using your lettering :-
- See b below
- Up to you, but totally OK is your have monthly payslips. Whenever a payslip is generated, I think that is the time to move the net amount, as per that payslip, from the company account to your personal account.
- The employer's NI, whenever a salary payment is made, will be less than the Corporation Tax payable if profit is left in the company, and then paid out as dividends. So to get to the £20k mark as soon as possible it is probably better to take out salary rather than dividends, at least until the £20k mark is reached. But based upon the amount of profit you are generating, maybe your Accountant would suggest doing the other thing.