Top Tax Tips for Owner Managed Businesses
1. Remuneration Planning
Remuneration planning is a key strategy to mitigate the tax liability of a shareholder-director.
The planning adopted will depend on the commercial requirements of the company but may include:
■Bonuses
■Dividends
■Loans
■Capital Distributions (perhaps on a liquidation)
For a stand-alone small company the best strategy remains to pay a small salary complemented by dividends.
Every case is different though and depends on the marginal rate of the company and individual. Utilisation of a spouse’s unused basic rate band should also be considered but must be handled with care and advice taken.