4 ms·

How do you get the money out of your limited company without paying the higher rate? The only option is dissolving the company and claiming entrepreneurs relief

• ownagefool 11y ago
  > How do you get the money out of your limited company without paying the higher rate? You don't, that's your retirement/rainy day fund. > The only option is dissolving the company and claiming entrepreneurs relief, but then you are back to FTE or umbrella (or phoenix). You'd only really do this if you don't intend on contracting anymore. Hopefully by that time it's enough to not work anymore. Alternativly, just keep paying yourself a small salary and dividens. > Also my understanding of investing company profits was that you are taxed twice on profits, and it could change your company status if you want to claim ER in future. You won't get taxed twice but if you investing starts bringing in a lot more than contracting then you company could be reclassified. That said, you can also roll up an investment entity and pay that tax there. You'd be paying 28% on profits but you'd have more money in the pot making money. Obviously you can also pay yourself more and pay the high rates of tax, or you can put it into a pension, a SIPP is arguably the best long term option.