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In this episode of the Medics’ Money podcast, Steve Nichols from Nichols Specialist Medical Accountants in London joins Tommy to discuss the complexities and potential benefits of starting a limited company for tax planning. They explore various scenarios where a limited company can offer flexibility in paying less tax, distributing profits, paying off mortgages, and managing pension contributions. The discussion covers the differences between receiving a salary and dividends, the benefits of family investment companies and money box companies, and how to navigate key tax thresholds. They also touch on the considerations and processes involved in setting up a limited company and employing family members. Steve offers valuable insights into the practical aspects and legal considerations, making this a comprehensive guide for anyone considering a limited company for tax efficiency.
00:00 Introduction: Should I Start a Limited Company?
00:27 Meet the Expert: Steve Nichols
01:49 Understanding Limited Companies and Tax Planning
02:54 Flexibility of Limited Companies
3:07 Salary vs. Limited Company Payments
03:52 Tax Efficiency and Limited Companies
11:29 Different Ways to Take Funds Out
17:19 Setting Up a Limited Company
19:42 Family Investment Companies
23:46 Money Box Companies
25:09 Dividend vs. Retained Earnings: Tax Implications
26:15 Members Voluntary Liquidation and Tax Savings
26:33 Understanding Business Asset Disposal Relief
26:59 Money Box Companies: A Tax Strategy
31:12 Cliff Edges in Taxation: 100K and 200K
35:54 Avoiding Pension Tax Charges
40:31 Using Director’s Loan Accounts to Pay Off Mortgages
45:22 Employing Family Members in Your Limited Company
48:43 Conclusion and Contact Information
