PAYE Limited company is it compulsary?

Poodle
Poodle Registered Posts: 711 Epic contributor ๐Ÿ˜
Hi

If you have a close company with directors having income elsewhere so not taking a salary, only dividends, but they are taking off business expenses that would not be reported on a P11d from the company, does the company still have to be registered for PAYE?

Poodle

Comments

  • groundy
    groundy Registered Posts: 495 Dedicated contributor ๐Ÿฆ‰
    It is my understanding that the company must be registered for PAYE as the directors are still employees whether or not they take a salary.

    I would suggest requesting the PAYE scheme to be on an annual basis explaining that no they are non salaried directors and no other employees and then submit a nil P35 at year end.
  • PAMDILL
    PAMDILL Registered Posts: 721 Epic contributor ๐Ÿ˜
    I have several limited companies which have directors and trade but no wages paid. I checked with HMRC a few years ago and they stated did not have to register as an employer.
  • A-Vic
    A-Vic Registered Posts: 6,970 Beyond epic contributor ๐Ÿง™โ€โ™‚๏ธ
    I have several limited companies which have directors and trade but no wages paid. I checked with HMRC a few years ago and they stated did not have to register as an employer.

    Totally agree - We have a number of limited companies on the books however only a few of them are reg for salary reasons not all of them have to be :001_smile:
  • PaulPSB
    PaulPSB Registered Posts: 55 Regular contributor โญ
    If there are any BIK requiring P11D then the company will need a PAYE Ref even if no salaries so there is a record to post the P11D against. :001_smile:
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor ๐Ÿง™โ€โ™‚๏ธ
    Paul makes a very good point. It is highly likely that close company directors are, if nothing else, reimbursing expenses that are P11D reportable. Obviously a dispensation would cover most of them but you cannot submit a dispensation application without a PAYE scheme in place.

    That said, if there is no salary and only s.336able(?) expenses are reimbursed and the directors do not want a PAYE scheme set up then I would be inclined not to do so.
  • Poodle
    Poodle Registered Posts: 711 Epic contributor ๐Ÿ˜
    Thanks guys

    I will leave as is for the mo and just wait until they want to pay for their personal tax returns through the company:001_smile:

    Poodle
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