| Furlough pay and small business owners 09:45 - Mar 26 with 1701 views | GeoffSentence |
I know a small business owner who is about to shut up shop for the forseeable future. Her staff will all be getting the 80% pay from the government. She will too, but in her case it amounts to a pretty trivial £120 per week.
The reason she is getting such a small amount is that as a director of the company her income has been almost entirely from share dividends and next to nothing as pay, in order to pay less tax.
I think this is entirely right, she has been handsomely paid for her endeavours over the years and has avoided paying as much tax as she possibly could, so she shouldn't expect to get payouts from the public purse now.
To her credit she is not complaining about it.
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| Furlough pay and small business owners on 09:56 - Mar 26 with 1666 views | Pinewoodblue |
80% of declared income will leave a lot of self-employed short. |  |
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| Furlough pay and small business owners on 09:58 - Mar 26 with 1657 views | StokieBlue |
A lot of self-employed people are going to be yelling if they don't include dividends in the 80% coverage today.
As you point out though, happy to take advantage when it suits.
SB |  |
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| Furlough pay and small business owners on 10:07 - Mar 26 with 1638 views | Guthrum |
| Furlough pay and small business owners on 09:58 - Mar 26 by StokieBlue |
A lot of self-employed people are going to be yelling if they don't include dividends in the 80% coverage today.
As you point out though, happy to take advantage when it suits.
SB |
Effectively, all self-employed earnings are drawings from the business, the equivalent of profit. There is no company, so no pay structure. |  |
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| Furlough pay and small business owners on 10:33 - Mar 26 with 1608 views | itfcjoe |
That's just how it is, you can't have it both ways as self employed people will find wioth what they have traditionally declared
Most directors take their dividends as wages so will be able to keep doing this as is declared dividends - not salary |  |
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| Furlough pay and small business owners on 10:34 - Mar 26 with 1603 views | StokieBlue |
| Furlough pay and small business owners on 10:07 - Mar 26 by Guthrum |
Effectively, all self-employed earnings are drawings from the business, the equivalent of profit. There is no company, so no pay structure. |
That's not true for people working through a limited company though of which there are many.
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| Furlough pay and small business owners on 10:39 - Mar 26 with 1581 views | GlasgowBlue |
Same here.
"You must stay at home" by GlasgowBlue 24 Mar 2020 7:24Put yourself on furlough and you’ll get 80% of your wages paid. Wish I hadn’t taken the minimum salary allowed for a director though.
I could continue to trade but I have to put my own health and that of others first.
If the system works well for tax efficiency most of the time them you have to take the hit when it doesn’t.
Edit. If your friends company has any money in the account then they can draw it as a directors loan which should ensure they don’t starve during lockdown. [Post edited 26 Mar 2020 10:41]
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| Furlough pay and small business owners on 10:41 - Mar 26 with 1569 views | Guthrum |
| Furlough pay and small business owners on 10:34 - Mar 26 by StokieBlue |
That's not true for people working through a limited company though of which there are many.
SB |
Yes, but they aren't self-employed. Having a company means they can access the Governments other schemes.
The purely S/E can't. | |
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| Furlough pay and small business owners on 10:43 - Mar 26 with 1560 views | GlasgowBlue |
| Furlough pay and small business owners on 10:41 - Mar 26 by Guthrum |
Yes, but they aren't self-employed. Having a company means they can access the Governments other schemes.
The purely S/E can't. |
Indeed. There needs to be parity with regards to the help that is announced today. It simply isn’t fair to cut adrift this people who are self employed.
May be worth setting up a limited company when things get back to normal gutters. There are enormous benefits and no personal liabilities if you go tits up. | |
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| Furlough pay and small business owners on 10:46 - Mar 26 with 1543 views | BloomBlue |
| Furlough pay and small business owners on 09:58 - Mar 26 by StokieBlue |
A lot of self-employed people are going to be yelling if they don't include dividends in the 80% coverage today.
As you point out though, happy to take advantage when it suits.
SB |
I was saying to someone yesterday, if they use tax returns from 2018-2019 as the basis for paying the self employed I can see 1000's moaning it's not enough because of the 'cash in hand' not declared in their tax |  | | |
| Furlough pay and small business owners on 10:47 - Mar 26 with 1539 views | Guthrum |
| Furlough pay and small business owners on 10:43 - Mar 26 by GlasgowBlue |
Indeed. There needs to be parity with regards to the help that is announced today. It simply isn’t fair to cut adrift this people who are self employed.
May be worth setting up a limited company when things get back to normal gutters. There are enormous benefits and no personal liabilities if you go tits up. |
But loads more admin, which adds to my workload. Plus I'd need to hire an accountant to audit figures. With the hassle and extra cost, not currently worth it. I have no business liabilities anyway (apart from public liability, for which I have insurance). | |
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| Furlough pay and small business owners on 10:48 - Mar 26 with 1530 views | Guthrum |
| Furlough pay and small business owners on 10:46 - Mar 26 by BloomBlue |
I was saying to someone yesterday, if they use tax returns from 2018-2019 as the basis for paying the self employed I can see 1000's moaning it's not enough because of the 'cash in hand' not declared in their tax |
That would be an admission of fraud, thus very silly. | |
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| Furlough pay and small business owners on 10:49 - Mar 26 with 1522 views | fabian_illness |
As long as my staff get paid, my workforce stays intact.
We have work to go back to when the restrictions are lifted.
This is that ‘rainy day’ my parents and grandparents used to keep going on about. |  | | |
| Furlough pay and small business owners on 11:00 - Mar 26 with 1505 views | Lord_Lucan |
I'm in a similar situation, I pay myself minimum wage and pay myself dividends to avoid tax.
I've made my bed, I'm not complaining.
Even though the self employed are being addressed today I can see problems with this, no size fits all!
Agency workers - what happens to them? They aren't PAYE or self employed.
A government minister said it's like wacamole , every time you think it's sorted something else pops up. |  |
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| Furlough pay and small business owners on 11:06 - Mar 26 with 1476 views | Guthrum |
| Furlough pay and small business owners on 11:00 - Mar 26 by Lord_Lucan |
I'm in a similar situation, I pay myself minimum wage and pay myself dividends to avoid tax.
I've made my bed, I'm not complaining.
Even though the self employed are being addressed today I can see problems with this, no size fits all!
Agency workers - what happens to them? They aren't PAYE or self employed.
A government minister said it's like wacamole , every time you think it's sorted something else pops up. |
Indeed. Vastly complex structures which have evolved over time are not easy to untangle in an emergency. Even getting people to apply for UC has simply overloaded the system.
UBI might have been simpler, but very difficult to balance for different regional costs of living, plus the time-consuming issue of sorting out those who can't work (and need it) from those who still can. | |
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| Furlough pay and small business owners on 11:16 - Mar 26 with 1444 views | hampstead_blue |
Good example of 'pay what's due'.
Am pleased she's accepted it. |  |
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Those who assume they know you, when they don't are just guessing.
Those who assume and insist they know are daft and in denial.
Those who assume, insist, and deny the truth are plain stupid.
Those who assume, insist, deny the truth and tell YOU they know you (when they don't) have an IQ in the range of 35-49.
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| Furlough pay and small business owners on 11:57 - Mar 26 with 1396 views | homer_123 |
| Furlough pay and small business owners on 10:41 - Mar 26 by Guthrum |
Yes, but they aren't self-employed. Having a company means they can access the Governments other schemes.
The purely S/E can't. |
Not all Ltd companies can access the scheme - you have to have 'offices'.
If you WFH, it's not going to cut it. |  |
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| Furlough pay and small business owners on 12:05 - Mar 26 with 1384 views | Lord_Lucan |
| Furlough pay and small business owners on 11:57 - Mar 26 by homer_123 |
Not all Ltd companies can access the scheme - you have to have 'offices'.
If you WFH, it's not going to cut it. |
It's certainly a thing with a lot of our customers unfortunately. We supply Amazon and EBay sellers working out of their houses that sell a lot more goods than high street stores but because they have no rates bill they do not qualify for the £10k grant.
I can also see all of this money taking a lot of time to get to where it needs to be through no real fault but an unprecedented workload. | |
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