Monthly Archives for July, 2011

Late Payment Penalties

July 28, 2011
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From the 6 April 2010 HMRC introduced a new penalty regime applicable to PAYE, NIC, CIS and Student Loan Deductions.

Any amounts due which are not paid on time are liable to be penalised. A late payment penalty warning letter will be issued after the first late payment, however, subsequent breaches will attract penalties which increase in line with the number of late payments as follows:-

No. of times payments are late in tax year
Percentage Penalty
1 No penalty
2-4 1%
5-7 2%
8-10 3%
11 or more 4%

If you have no PAYE/NIC payments to make for a month or quarter; to avoid an unnecessary warning letter being issued, it is important to inform HMRC on or before your normal payment date that no payment is due.

Shareholder Agreements and Shareholder/Partnership Protection

July 26, 2011
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If your company has 2 or more shareholders it may be worthwhile to have an agreement in place to state what would happen to the shares if one of them dies.

This is something that nobody likes to think about – however there can be serious problems for companies if the unthinkable does happen and no proper arrangements have been put in place.

Shareholder/Partnership Protection is purely a life policy taken out to make sure that, should a shareholder die, the shares of the company remain in the hands of the other directors while the estate of the deceased shareholder benefits to the value of the shares.

The death benefits from the Shareholder/Partnership Protection Plan is paid to the surviving directors who then use it to buy the shares of the estate, often under the terms of a shareholder agreement set up in conjunction with the insurance.

Even if you already have an agreement in place and are paying insurance it is important to review the policies on a regular basis as the level of cover may not be sufficient to cover the cost of the shares if the business value has increased.

If any of this is of interest to you or you want to find out more about it then you can contact us and we will put you in touch with the relevant people.