UK taxes and accounting

[termi]

Hello

I'm looking to create UK LTD company since TAX law in Poland sucks and 95% invoices i get from my contractors can't be use for tax deduction and I have some questions since UK system is very different then Poland.

Can you use Paypal invoice as cost to deduce taxes?
How your tax free allowance work? It is 10,500 GB but some say about monthly allowance do I have to pay my self every month to use whole tax fee or can i pay my self 10,500 once a year and still not pay any taxes?
From what I understood if I'm CEO of LTD company i can get paycheck without paying social security is this true?
Do any one know any way to get USA bank account for UK company with out actually going to USA?
What is yearly cost of accounting and virtual office? I find couple that specialize in Polish customers but i want to know what is average price.

 

[pseudonym]

as long as your physical body is located in poland, the polish irs will still want you to answer their questions

 

[cataratas]

Yes you can claim Paypal invoices as allowable expenses against profit in the UK. As long as the expense is solely and exclusively for the business you are good to go. If it is not solely and exclusively for the business you must apportion the expense accordingly.
As for how you use your personal allowance, it depends how you set up to pay yourself. You can be a PAYE employee of your own company (Pay As You Earn) and the allowance is calculated within your weekly/monthly salary payment. Alternatively you may draw dividends. Most directors draw a small salary AND take dividends to maximise tax efficiency.

 

[LostConnection]

 

[LostConnection]

Yes you can claim Paypal invoices as allowable expenses against profit in the UK. As long as the expense is solely and exclusively for the business you are good to go. If it is not solely and exclusively for the business you must apportion the expense accordingly.
As for how you use your personal allowance, it depends how you set up to pay yourself. You can be a PAYE employee of your own company (Pay As You Earn) and the allowance is calculated within your weekly/monthly salary payment. Alternatively you may draw dividends. Most directors draw a small salary AND take dividends to maximise tax efficiency.

Good stuff, but OP remember to check with a local accountant whether or not you actually end up maximizing or fucking up your tax efficiency with taking a small salary, as this depends largely on the taxation laws fo your own country.

 

[termi]

Yes I know I still answer for Polish IRS but LTD company is different identity then me I have to send yearly statement to polish tax office but only for money I earn as a privet person, not the money LTD company earned that I'm CEO. So any tax deduction on costs will be on companies side and I pay my self only profits. And according to Poland - British agreement of not paying double taxes I will be paying taxes only once.

 

[cataratas]

Yes, correct. There is a double taxation agreement between the 2 countries. As Lost Connection implies- do your research, get professional advice and get set up correct right from the start so that nothing comes and bites you in the backside down the line.

 

[termi]

cataratas thx paypal question was most important qestion for me And in Poland it is not possible to deduce PayPal invoice I every time have to ask seller for custom invoice and not every one will do that.


LostConnection I already checked for taxes and it is much more effective for up to around 100,000 GB since you have large tax free amonth 10,500 GB while in Poland it is just 500 GB. But honestly I don't do this for taxes i do this beacose UK treat businessmen like they deserve to be treated while polish government treat business people like garbage. My ex boss had to go every second month to IRS to explain invoices from Google ad words only because they whear from Irland losing every time 4h of his time. And fun fact to be up to date with company law in Poland you have to read 100 pages of text per DAY!

 

[pseudonym]

... My ex boss had to go every second month to IRS to explain invoices from Google ad words only because they whear from Irland losing every time 4h of his time. And fun fact to be up to date with company law in Poland you have to read 100 pages of text per DAY!

as i've explained, none of this will change. as long as your physical body is located there, they will want you to answer their [ 100s of ] questions. or face fines. or worse. opening a UK company will not solve the core issue

 

[RedTurtle]

since you have large tax free amonth 10,500 GB

Firstly its 10,600 and its personal tax allowance. It has absolutely nothing to do with a LTD company.

A LTD company has no tax free allowance, you pay 20% tax on all your profit as corporation tax (this may vary based on being a charity etc).
Yes your salary of 10,600 is deemed to be an expense and will reduce the amount your company makes in profit so you won't pay 20% tax on that 10,600.

The 10,600 being paid as a salary from your company, will be deemed as personal income and how that is taxed I cannot comment, you may be taxed the same as a UK Citizen which you are correct the first 10,600 is tax free (though you will pay a few hundred in NI), though that income may be taxed under polish tax law.

You need to seek advice from a professional who knows specifically about these things, i'm sure you can get this information for free from them.

btw after 10600 we then pay 20% tax, after 42385 we then pay 40% tax, until 100k then it gets "funny".