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Hi all,
just seeking some advice from people who may have been in the same situation recently.
I have my own limited company. Now I don’t make stupids amount but my business earns well. I pay myself a salary of 12,750 and add some dividends to my income as and when is necessary. Do the CMS have access to to dividend payments when they next review my case?
Also looking to find out what access the CMS have to by business accounts and money in my business?
Any information regarding these topics would greatly appreciated I keep reading very conflicting information.
Many thanks
Hi,
With LTD, CMS only see your PAYE salary (if declared to HMRC) when they check HMRC records at review time. Of your withdrawing money from company as dividends, then would be wise to declare it at annual review time.
I recommend this support group for paying parents. Very useful:
@bill337 To some extent i think it depends on if your ex is switched onto the fact that your income must be more than 12,750. If she is then she will ask for a variation and CMS will ask you for evidence of any dividends. In short, unlikely you will get away without declaring them, and as Bill says, is easier to declare them up front so you do not have arrears applied.
I do not believe that CMS has access to your business accounts, but, if your ex feels short changed and wishes to apply for a variation based on diverted income, they can ask for your books and to see what retained profit you have in the company.
My advice, based on experience, is to not try to hide everything. As it is being Limited means you are assessed less because they do not take income tax into account. So, if you declare what you are doing, and your ex is getting a reasonable amount, she is less likely to complain and trigger investigations into what lies behind......
@hrabbit thank you for your response and advice
it seems like your both saying the same thing they will only originally see my PAYE however may be wise to declare my dividends myself?
many thanks
@bert1177 Yes because you will likely get asked to declare them when your ex asks for a variation. It is probably also not a good look to be paying CM based on such a low amount, if you are actually earning much more......If they have to ask you because your ex has complained then this may trigger a deeper investigation and then retained company profits could be considered etc.....
@bill337 To some extent i think it depends on if your ex is switched onto the fact that your income must be more than 12,750. If she is then she will ask for a variation and CMS will ask you for evidence of any dividends. In short, unlikely you will get away without declaring them, and as Bill says, is easier to declare them up front so you do not have arrears applied.
I do not believe that CMS has access to your business accounts, but, if your ex feels short changed and wishes to apply for a variation based on diverted income, they can ask for your books and to see what retained profit you have in the company.
My advice, based on experience, is to not try to hide everything. As it is being Limited means you are assessed less because they do not take income tax into account. So, if you declare what you are doing, and your ex is getting a reasonable amount, she is less likely to complain and trigger investigations into what lies behind......
@bill337 I am not in Facebook so unable to join group.
Thank you for response. Now at the moment she is getting less then what 12,750 would get her. So I’m entirely sure she would know she is entitled to more. Can I just check that what your saying is on original review they don’t take dividends into account however your advice would be for me to declare them?
thank you for advice.