1 / 40

Business Tax Planning Strategies for 2010

drake
Download Presentation

Business Tax Planning Strategies for 2010

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

    1. Business Tax Planning Strategies for 2010  Chair: Russell Dowd Standard Life Peter Rayney Peter Rayney Tax Consulting Ltd

    2. Business Tax Planning Strategies for 2010  Peter Rayney Peter Rayney Tax Consulting Ltd

    3. Business Tax Planning Strategies for 2010 Choice of trading vehicle Income extraction from small companies Spousal dividends (Income shifting techniques) CGT and Entrepreneurs’ relief (ER) changes

    4. Choice of trading vehicle

    5. Company v Partnership v LLP

    6. Tax - Company v Partnership v LLP

    7. Using an Unlimited Company?

    8. Sale of goodwill at MV

    9. The Tornados - Telstar

    10. Sale of goodwill at MV

    11. Joe - Case study

    12. Joe Meek’s recording studio

    13. Corporate tax - goodwill

    14. Post-incorporation balance sheet

    15. Income extraction from small companies

    16. Dividend taxation – 2010/11

    17. Bonus v Dividends – 2010/11 Basic Ł60,000

    20.

    21. Spousal dividends (income shifting techniques)

    22. Maximum tax-free dividend – 2010/11

    23. Paying dividends to spouses Is issue/transfer of shares to spouse a ‘settlement’ Arctic Systems - key conclusions Pearce v Young - non-voting preference shares Inter-spousal settlement exemption Not where shares are ‘wholly or substantially a right to income’ Ordinary shares - bundle of rights

    25. Paying dividends to spouses Is issue/transfer of shares to spouse a ‘settlement’ Arctic Systems - key conclusions Pearce v Young - non-voting preference shares Inter-spousal settlement exemption Not where shares are ‘wholly or substantially a right to income’ Ordinary shares - bundle of rights

    26. Dividend-splitting – 2010/11

    27. David & Iman

    28. CGT and Entrepreneurs’ relief (ER) changes

    29. CGT rates on qualifying share sales

    30. ER – share sale 3.5 Owner managers selling shares would need to satisfy the normal ER conditions within the year before the share sale (as shown above)3.5 Owner managers selling shares would need to satisfy the normal ER conditions within the year before the share sale (as shown above)

    31. ER

    32. ER – share sale 3.5 Owner managers selling shares would need to satisfy the normal ER conditions within the year before the share sale (as shown above)3.5 Owner managers selling shares would need to satisfy the normal ER conditions within the year before the share sale (as shown above)

    33. ER – Trading Company/Group test 3.6 The ‘trading company/trading group’ requirements have been ‘borrowed’ from the business taper rules. A company/group therefore qualifies provided it exists wholly for the purpose of carrying on one or more trades (on a commercial basis), subject to the disregard rule for insignificant non-trading activities.   A company is permitted to have non-trading activities provided they do not have a substantial effect on the company’s overall activities. HMRC take the view that non-trading activities may be regarded as ‘substantial’ if they represent more than 20% of the company’s business. In marginal cases, the 20% test will be applied to various measures, such as turnover, profits, assets employed, management time etc.3.6 The ‘trading company/trading group’ requirements have been ‘borrowed’ from the business taper rules. A company/group therefore qualifies provided it exists wholly for the purpose of carrying on one or more trades (on a commercial basis), subject to the disregard rule for insignificant non-trading activities.   A company is permitted to have non-trading activities provided they do not have a substantial effect on the company’s overall activities. HMRC take the view that non-trading activities may be regarded as ‘substantial’ if they represent more than 20% of the company’s business. In marginal cases, the 20% test will be applied to various measures, such as turnover, profits, assets employed, management time etc.

    34. ER – share sale 3.5 Owner managers selling shares would need to satisfy the normal ER conditions within the year before the share sale (as shown above)3.5 Owner managers selling shares would need to satisfy the normal ER conditions within the year before the share sale (as shown above)

    35. ER – Computational examples 6 April 2008 to 6 April 2010

    36. ER – Computational examples From 22 June 2010

    37. Business Tax Planning Strategies for 2010 Choice of trading vehicle Income extraction from small companies Spousal dividends (Income shifting techniques) CGT and Entrepreneurs’ relief (ER) changes

    38. Thanks for listening…

    39. Business Tax Planning Strategies for 2010  Peter Rayney Peter Rayney Tax Consulting Ltd

    40. Thanks to our headline sponsors

More Related