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bigduckontax
bigduckontax, Accountant
Category: Tax
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Experience:  FCCA FCMA CGMA ACIS
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We are a Start up, just launched. We have a company registered

Customer Question

We are a Start up, just launched. We have a company registered in UK which has not filed any corporation tax returns so far. We have our Accounts submission due date July 2015 and financial year end December. We formed the company in the year 2013.
Another question is about Director's PAYE. Since this company is a 2 people company including owner and staff member and both of them get paid by the UK Government and the salary is not taxable, The director/owner has never withdrawn any amount in terms of salary or bonus, Should the director submit PAYE (but the company is not PAYE Registered) or submit EPS stating that no salary has been taken out and when should this be submitted.
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.

Hello, I'm Keith and happy to help you with your question.

As you may be aware Directors of companies are employees per se and must be remunerated through PAYE arrangements. However, if no wages are withdrawn then at this stage registration by the company for PAYE is not required nor EPS either. Reimbursement of expenses laid out by such persons on behalf of the company being refunded is outside the scope of UK taxation.

As far as Corporation Tax is concerned this return must be filed on line. You can also do your annual Companies House abbreviated accounts filing simultaneously, a very convenient way of avoiding this boring chore. Please see 'Deadlines and requirements for corporation tax' on HMRC web site. Here is HMRC advice upon when filing of accounts must be made: You must also alert HMRC to the presence of your company to get the ball rolling as it were.

'You must normally file your company or organisation's Company Tax Return - which includes a Company Tax Return form and other supporting documentation - within 12 months of the end of your company or organisation's Corporation Tax accounting period. Your Company Tax Return filing deadline is known as your 'statutory filing date'.'

I do hope I have put your mind at rest on this matter.

Customer: replied 2 years ago.

Thanks, ***** ***** question:

Since the director has never withdrawn any money in terms of salary and definitely its not gonna happen until we are being funded by UK Government for our salaries which is clearly non taxable.

But the company has director who is required to pay PAYE and NI Contribution. Kindly if you could clarify whether Director can pay NI keeping in mind that he never gets salary?

Also, If we don't register us with PAYE and don't pay NI Contributions because we don't pay salaries, Is it an issue?

Thanks again.

Expert:  bigduckontax replied 2 years ago.
No, but if you are paying a Director whose remuneration exceeds his code number or the minimum NI salary level [GBP 7956] you must register and operate his payments through PAYE.
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3389
Experience: FCCA FCMA CGMA ACIS
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Expert:  bigduckontax replied 2 years ago.
Thank you for your support.

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