Director of my own company - do I qualify for the 80 per cent salary?

[cucumber66]

I’m a director of my own limited company and ordinarily earn about 28k per annum. However, since the virus hit business has dried up and I’m facing serious financial difficulties.

From what I gather, I’m also classed as an employee of my company and am paid my monthly salary through the payroll. There are no other directors or employees - it’s just me.

I can’t get hold of my accountant tonight to check whether I’m eligible for the 80% government grant and am feeling anxious as to whether I can claim this. It could be the difference between my business surviving or going under. Does anyone know?

Well we will just have to pay a dividend to top up to survive which uses up the cash quicker endangering future salaries of employees.

Since the government are giving us no help whatsoever, the very least they could do is give an amnesty on dividend tax so we can at least utilise our own funds.

Otherwise, it's massively skewed to be giving the rest of the country free handouts, yet charging us extra to live.

Petition here with over 90,000 signatures, please sign.. www.change.org/p/uk-parliament-small-ltd-company-directors-to-get-government-support-like-the-employed-and-self-employed?recruiter=29460895&utm_source=share_petition&utm_campaign=psf_combo_share_initial&utm_medium=whatsapp&utm_content=washarecopy_21080167_en-GB%3Av3&recruited_by_id=a4ef7d50-e70a-012f-b072-404046835f95

ginggang
You are asking for UNEARNED income to be reimbursed.
If that goes through the biggest beneficiaries will be the super rich and the hedge fund managers.
Not in a million years should that petition succeed.
Sorry.
Me made our bed, we have to lie in it.

On behalf of a client I have fought an FTSE100 company and made them back down on his IR35
that is where our energies should go - getting rid of IR35 and forced incorporation

All this talk about paying VAT🤣

Its collected from customers on behalf of HMRC and given to HMRC.

No you do not pay 19% corporation tax on everything its paid on net profits.

Are there no Accountants on Mumsnet?

After reading all these kinds of threads, once the world gets back to business, I shall forgo an Accountant and look for a good tax advisor instead.

After reading all these kinds of threads, once the world gets back to business, I shall forgo an Accountant and look for a good tax advisor instead.
CCAB snigger

I am furloughing but have got the digital side of my business website, email etc now contracted out to a consultant.

Hopefully it will look pretty seamless to public but I hope that doesn't come back to bite me on the bum!

@ListeningQuietly. Billionaires will not benefit as the maximum income cap is £50,000 per year for self employed people. Also it is capped at £2500 a month. You say it is unearned income, yet other people on PAYE are sitting at home doing nothing but still getting paid.
Please sign, anyone reading this who is in financial difficulty. Thank you.
chng.it/YFj8Tf7p

Unless I am missing something? All I know that we have done our best, paid our taxes, operated a legal company, of one, my husband. We were pressured to become a limited company by our suppliers and by agencies. We earn under £50,000. We have done nothing wrong, yet we are not being helped in any way. We have 3 children to support. If people have a problem with the above I don't give a shit at this point.

So if you think my situation is funny then kindly go fuck yourselves.

I totally agree wotsit
Some people are just cunts.

I have not read the thread but it is based on PAYE salaries so those with companies as here who take some salary will get the free cash and those like I am who are a sole trader self employed who declare all income and pay 40% tax + on over £50k a year do not get a single penny. Most directors who also take dividends do have some PAYE salary so the state has chosen to reward those who limit tax via a company and punish those who are sole traders and earn over £50k.

Same for high paid employees - earn £1m a year can get £2000 a month free money from the state. If you are over £50k and self employed you get not a single penny.

Same for tax evaders = Jim is a sole trader who earns £100k but is mostly paid in cash and just declares £30k - he gets the free money for he self employed. Jane earns £55k as a sole trader with no limited company and pays £20k a year on childcare costs and doesn't get a single penny.

Ever thus. And next year those of us who get none of these benefits and have no limited company will have vast amounts of new tax to pay. I hope the old and sick (and a very few others) whose lives are saved by this are very grateful in the future for the damage done to so very many ordinary citizens.

Xenia you'll only get 'free money' if you have a company if you stop trading and only do things like file your taxes.

Most directors (like me) won't be able to do that because my wage is a teeny tiny amount of my overheads. If I did that I wouldn't be able to pay the rent for the building I'm not currently using, the software I use, my insurance or accountancy fees. I wouldn't have a business to return to.

So at the minute I'm working 80 hours a week for pennies to pay everybody else and not able to apply for a penny off the government.

Whereas if I was self employed I could run my business as normal and then get a payout from the government for my wages.

We don't need to turn on each other there's lots of people losing out for one reason or another.

I really think the way they've done it has sewn a lot of resentment and division and they'd have been much better off doing a universal basic income for while the crisis was on.

they'd have been much better off doing a universal basic income for while the crisis was on.

There'll be more people who don't lose any income for the duration than those who do. Pensioners, essential workers, disabled, unemployed, those living on investment/property income etc., are unlikely to see much, if any, reduction in income. Benefits need to be targetted, not scatter-gunned.

Martin Lewis has tweeted confirmation that it's statutory duties only, so connected with filling, accounts, complying with company law etc. not client work or trying to get client work.

Take it all with a pinch of salt until officially notified by HMRC. Hearsay won't stand up in court if challenged, not even from a TV presenter!

I shall forgo an Accountant and look for a good tax advisor instead.

Properly qualified accountants (CCAB) in practice are usually tax advisors too.

Are you meaning the unqualified/unregulated glorified book-keepers who call themselves accountants?

There are also chartered tax advisors (CIOT) but they're usually more specialised tax consultants for complicated things like property portfolios, trusts, international tax, inheritance tax, capital gains, etc., rather than bog-standard self employment!

Thought this might be of interest for people watching this tread.

There is a letter regarding Limited Company Directors & self employed earning over 50K threshold been sent to the government, which needs maximum support by 5pm today.

It is sent by Advertising Producers Association, but I am sure there are freelancers from other fields in the same boat. (I am not Steve - this is copied from the email sent around by APA).

It is quite time sensitive as more people they have emailing them by 5pm today the better!

---------------------

This email has gone to the Treasury now. We have the greatest chance of success if everyone freelancer working in commercials emails [email protected] says that they:

1 Will not receive any money under the freelance scheme (assuming that is true for them of course) and
2 Support the proposals put forward below.

Of course please share with everyone you know and, in particular, all the diary services.

5pm tomorrow Monday 30th March is the deadline for responses to the Treasury on the freelancer proposals announced last week. The fact they have invited responses means there must be a prospect they will listen to what we have to say.
Best Steve
a-p-a.net
0207 434 2651

Dear Sir or Madam
Thank you for your proposals to help freelancers and for the opportunity to make comments/proposals on your steps so far. We make this submission on behalf of the many freelancers in commercials production and jointly with Moore Kingston Smith, accountants, whose clients include many of those freelancers. Our member companies engage many freelancers and our interest reflects our members concern for them.
While the proposals are welcome, our survey of freelancers in commercials production (via a Zoom call with 233 participants on Friday 27th March and emails) is that over 90% of freelancers in commercials production and advertising generally will not be able to participate. We therefore propose the following changes:
1 We propose that the £50,000 cap is removed. We appreciate that is there to focus the assistance on poorer people but it is arbitrary and a household where the sole bread winner on £50,000 or even £80,000 per year, for example, will still likely be in a parlous position without any assistance during this unprecedented time. Of course, there is still an effective cap of £2,500 per month, so, in our view, the second cap of £50,000 should be
removed. This would create parity with the salary grant where no such cap applies.
2 Most freelancers working in our sector work through a limited company through which they provide their services. Generally they are required to do so by the companies who engage them- who among other things want to avoid the possibility of their winning any employment law rights.
So we propose that in circumstances where freelancers provide their individual services through their limited company that their combined salary and dividends be counted as income for the purpose of calculating the grant. Without that, given most of what they are paid is in dividends, your intention to help them will not become a reality.
3 Many people have become freelance less than 3 years ago. It is fairly common to chop and change between employment and freelance work in our sector. We would propose that you allow anyone who is freelance to file their 5 April 2020 tax return by 31 May 2020 and for their 19/20 income to be included for the purpose of calculating the grant. Again, without this, a whole group of people will be arbitrarily left out altogether.
We appreciate your consideration of these proposals and your work to assist people and businesses during this crisis.
Best regard
Steve
Steve Davies
Chief Executive
Advertising Producers Association
a-p-a.net
0207 434 2651

I think not enough information to tell yes, but looks like there will be little support for start-up, which is very unfair. Anyone else read it that way or have I got the wrong end of the stick?

Thank you so much for posting this. I'm emailing over now.

I have already sent a letter to my local MP, but will forward it also to the address above.

I do t see how that letter is helpful if directors still have to furlough themselves to get any money at all.

@gingganggooleywotsit, more emails they receive, more likely someone is to listen.

I've also been told by two different accountants, that there is hope in directors claiming at least for the 80% of what is put through PAYE (related to the time period). I've served myself furlough notice just to be safe :).

They've both advised that this is providing you have not worked on your company within the period furloughed, meaning it might be advisable to leave any company improvements / networking / client chasing until further date. This obviously might be easier for some businesses than others.

If you are on furlough you are not allowed to answer email or post or the phone
you are only allowed to carry out statutory functions.
After three months of that most people's clients will have gone elsewhere.
Or their suppliers will have put them into liquidation ......

@furrytoebean because they are asking government to look at how the assistance is set up, and change it to include the huge number of people currently falling outside safety net. If we don't try, there is even less chance in succeeding.

There is no precedent for these handouts, treasury are pretty much making them up as they go.

Also, I have been advised that furloughing director / sole employee MIGHT be possible. For example my last contract finished some time before 1st March, for which I submitted invoice end of Feb. I am therefore furloughing myself from 2nd March, as nothing else has happened since. As precaution I've sent email to my main contacts stating just that, and that the current period of furlough is lasting until Friday 10th April, and I am not sending any work related emails between now and then.

@ListeningQuietly as mentioned, it might work better for some businesses than others.

Works for what I do, as whether there is a lockdown will determine if I have work coming in or not. I can furlough myself in three week instalments, and once time is right finish the last patch and get in touch with clients, no suppliers involved. Not ideal, but if thats the only option to be anywhere near paying rent in June...

The letter is not asking for the extension of furlough to small businesses though, but for the government to have another look at how things are set up, and maybe to extend the self employed scheme to small business directors. Or something else. Again, we can only try.