"Pretend to" game UK LTD

[TheAverageGuy]

Pretend you are UK resident, and you have an LTD.
This LTD is going very well and is doing good business.
You've already took the amount of divided+ salary that will be tax efficient for you personal income taxation.
Same have been done by your co-director.
At the end of the fiscal year that will be in 3 months you will have an extra profit on the company of around 40k you will pay company tax on them but they will remain inside the company.
You can't apply for mortgages because company is too young.
What will be in your opinion the most tax efficient way to take out those money from the company?
What will be in your opinion the most tax efficient way to invest those money?

 

[Martin Everson]

TheAverageGuy said:
What will be in your opinion the most tax efficient way to take out those money from the company?
Click to expand...

£40k tax deductible pension contribution to director. Google it.

TheAverageGuy said:
What will be in your opinion the most tax efficient way to invest those money?
Click to expand...

Within your pension plan. You can choose pure cash funds or equity funds etc with the pension company. But seek professional investment advice.

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Please note my posts should not be taken as financial or tax advice. Please seek professional advice in that respect.

 

[TheAverageGuy]

Martin Everson said:
£40k tax deductible pension contribution to director. Google it.



Within your pension plan. You can choose pure cash funds or equity funds etc with the pension company. But seek professional investment advice.
Click to expand...

Thanks for your suggestion, this is the same solution that an accountant we know gave to this game.
Unfortunately this solution will also "lock" the money until the owner is 55 yo.
I would like to ear more intriguing options.

 

[DarkRevoMan]

TheAverageGuy said:
Thanks for your suggestion, this is the same solution that an accountant we know gave to this game.
Unfortunately this solution will also "lock" the money until the owner is 55 yo.
I would like to ear more intriguing options.
Click to expand...

Locking it isn't a big deal. If you structure things properly you can invest in private companies, real estate, etc. through a pension.

The other advantage is that pensions are protected in most places. You can go bankrupt and keep anything in a pension plan usually.

While not exactly the same check out what Mitt Romney did with his backdoor roth. You take cash, convert it to a pension plan (or other tax protected account) invest into private businesses, and all the gains are protected. He has $100 Million in tax protected accounts using this method.