RTI - Director Salary

JamesB
JamesB Registered Posts: 51 Epic contributor 🐘
in General accounting discussion
Just thinking ahead....

you know when directors take the basic salary to avoid paying tax/NI - think it's £6k or something similar.

To save time... instead of paying £500odd quid a month and having to submit it all to HMRC would it not be easier to just lump £6k as the salary in month 12 payroll every year?

Also does the RTI only relate to PAYE and not CIS and dividends?

I assume CIS carries on as normal as this info is submitted monthly anyway.

Cheers,

J

Comments

  • LynWest
    LynWest Registered Posts: 122 Beyond epic contributor 🧙‍♂️
    As far as i am aware CIS is carrying on as normal, no change.

    It would be easier just to submit £6K a year in a lump, however; HMRC specify with RTI that they need a submission before or on the PAYday. If you submit £6K at the end of the year, then the director would not be able to have any pay as a wage up to that point. This would therefore go as a loan to the director and break the £5000 limit before incurring a BIK. That is my understanding of it from a HMRC seminar i went to. It appears (and we will have to wait and see how it works in practice) that you can at the beginning of the year submit 11 nil declarations and then just before or on the payday do the £6K for the 12th period. I am a director and i am going to submit each month and set a reminder. HMRC on the seminar kept on drilling into us all that the submission could be inadvance or on payday but not after!

    Hope that helps and good luck. :)
  • TyneandWear
    TyneandWear Registered Posts: 34 Epic contributor 🐘
    LynWest wrote: »
    A

    HMRC on the seminar kept on drilling into us all that the submission could be inadvance or on payday
    but not after!

    Doesn't sound reasonable if submissions can't be made after day of payment - what about all those with
    irregular week-end hours, where hours are not known till end of shift ? (Weekend restaurant workers for
    example). Does that mean submission can't be made the following Monday ?

    If in the Tyne & Wear area, come to our branch RTI meeting this Thursday, (7th March),and ask our
    HMRC speaker to clarify this and other queries. (Centre for Life NE1 4EP. 6pm for 6.30 start).
  • Dcollins
    Dcollins Registered Posts: 179 Dedicated contributor 🦉
    There's a good article on Accountingweb that covers directors' pay http://www.accountingweb.co.uk/article/rti-troublespots-low-paid-directors/538069

    There's another on updating engagement letters http://www.accountingweb.co.uk/article/new-rti-guidance-engagement-letters/538195

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