Shaz takes us through expenses and the differences between being a sole trader and a limited company when you are justifying expenses

As a director of a limited company you always need to consider whether an expense is necessary in order to justify it but as a sole trader has more flexibility

You may want to borrow money from your company or you may be lending money to your company listen in and hear about the best and most effective ways to do this

 

KEY TAKEAWAYS

• The test for a justified expense is higher for a director than for a sole trader, being a sole trader gives you better flexibility
• A limited company has more rules, regulations and company laws to take into account
• If it’s not a salary or bonus you need to pay interest to your company
• You have to treat a limited company as if you are working for someone else where money is concerned, everything must be accounted for
• If you are lending money to your company you should charge interest
• A basic rate taxpayer has a £1000 income tax-free
• You can charge interest  and not pay any tax if you met the criteria
• Your company can claim 19% corporation tax relief on the money

 

BEST MOMENTS

‘For directors it’s about wholly, exclusively and necessary, was the expense necessary?’

‘A lot of small business owners lose sight of the fact a limited company is a separate legal entity’

‘You can have this and not pay a penny in tax’

 

VALUABLE RESOURCES

[email protected]

 

ABOUT THE HOST

Shaz Nawaz is a serial entrepreneur; he owns five thriving businesses in diverse sectors.

Shaz is committed to helping business owners build successful businesses. Having conducted over 3,000 business growth consultations he has helped his clients generate millions in additional profits. His purpose is to inspire business owners to build businesses that are hugely profitable and sustainable.

He is a huge advocate of having multiple streams of

income. He has written a number of business books and regularly contributes articles to mainstream media outlets.

You can find Shaz on:

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