Accounts question

[BigT]

I was trying to find out who owned shares in the company.

According to this: https://s3-eu-west-1.amazonaws.com/...QVoIzPMdq3vGL8vcc86cBOv5m2QzVEbw+PesowNuJ1AU=

The company is 100% held by a holding company named Personnel Holdings Limited

Looking at that company's records it looks like it has leveraged itself to be owned by a lot of other companies. you can see them listed on page 34 here:

https://s3-eu-west-1.amazonaws.com/...nULLqfF6ADElisYADETfMd3r8+cew3KYNF+0oxr+K1AU=

I couldn't be bothered to look further into those but you can continue to follow the paper trail to get to named individuals. The majority of the securities held in shares are by companies with 'bidco', 'midco' and 'topco' in their names which is a sure fire sign this company is owned by private equity firms in the majority as these are terms they use to setup a tax efficient group of companies when they invest or buy them outright.

 

[dr_volki]

I migth be wrong but I think with companies that are privately owned (by the directors) there's a tendancy to take only basic salary either <£12000 tax free a year or perhaps under the 40% tax point (or somewhere in between) then take the rest in dividends based on the profit (after company tax) / 100 ordinary shares x the number of shares that director holds.

In short, I think its a way for directors who may well earn a lot more than £100K and into the millions to in effect only pay the corporation tax rate as a "shareholder" which I think is 19%. Personally if Im right on this, I think its THE loophole that needs to change.

or am I wrong

It’s common in small owner managed businesses, less common in bigger companies.

Definitely not happening here given the company didn’t pay a dividend this year or the previous year.

very common in small companies / contractors.
set your salary just high enough to pay enough NI to be eligible for state pension, take rest out as dividend.
however the rules slightly changed for tax year 16/17, when HMRC brought in the dividend tax for anything over £5000 (or maybe lowered it, i don't know). there is a further reduction coming in april 2018 when your dividend tax free allowance will be £2000.

 

[VincentHanna]

It's still more tax efficient though.

In 2017/18 - Say you earn £61,500 as a company director

• The £11,500 salary takes up the entire 2017/18 personal allowance.
• The first £5,000 of dividends is included within the dividend allowance.
• The next £28,500 of dividends are taxed at 7.5% (basic rate) = £2,137.50.
• The remaining £16,500 dividends are taxed at 32.5% (higher rate) = £5,362.50.
• The total dividend tax liability is £7,500.
• You would only pay £400 National Insurance

Whereas If you earn that same £61,500 on PAYE salary you would pay £13,300 in tax and £4,750 in National Insurance

A difference of £10,150!

 

[neocon]

Did you find the named individuals who are share holders?

I can see the bit about the various holding companies that own the bulk 75%.

 

[Vonhelmet]

Did you find the named individuals who are share holders?

I can see the bit about the various holding companies that own the bulk 75%.

You’d need to work your way up the chain of companies, but if it hits a PE firm as someone has said above then it’s likely to get a bit meaningless beyond that.