Platinum Financial About Us

Clients We Have Helped

Corporate Financial Planning Profit Extraction & Tax Planning Case Study

Requirements Our clients came to us for tax planning and investment advice after experiencing an outstanding trading year, seeking advice on how best to mitigate their increased corporation tax liability and make the best use of their tax planning allowances.

How did Platinum help? We looked at how best to reduce the tax cost while keeping our clients fully compliant. We posed the question of whether the shareholders needed to extract the profit from the business right now. If taken as a dividend, the company would pay 19% corporation tax, while the shareholders as higher rate tax payers would each pay 32.5% tax on the dividend. After discussion with the directors, we agreed to use a significant portion of the profit to make pension contributions. Using carry forward from the previous 3 years annual allowance we were able to make a significant contribution from the company to their pension plans offsetting the corporation tax that would have been payable on that portion of the profit with this money now extracted from the company and in the directors pension as part of their retirement planning. The long-term relationship we had built with our client, in addition to our extensive tax planning knowledge allowed us to have a strong understanding of their circumstances and meant that our clients had confidence that the advice we gave was always in their best interests.

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