Withdrawing Money

[BriJo]

Hello,

I need someone to confirm my information for withdrawing profits from a business bank account for an LLP.

Im assuming that i can take my share of the profits when i want or leave however much i want in the business bank account to be classed as a reinvestment. Im also assuming i only have to pay NI and income tax on the profits i have withdrawn from myself.

If im wrong please say so.

[James Smith]

For tax, an LLP is EXACTLY like a partnership (except the accounts have to be prepared to ltd company standard which is a pain)

So you are taxed when you EARN the money, not when you TAKE the money from the LLP bank account.

Would suggest you seek proper professional advice if dealing with an LLP as it straddles the knowledge you need of running a limited company with that of running a partnership and because they are so rarely used there is very little reference material around.

NB l - are you sure this is the correct business structure for you? You get all the pain of a limited company without any of the tax/cash flow benefits! Normally only used in rare occasions where losses are expected but a wish for limited liability, and then converted fairly promptly to a proper limited company once profits are made. Either that or huge profits are made (around £500k+) and the tax can be less than a ltd co.

Anyway hope that helps.

Regards,

[BriJo]

Well i am hoping that my profits will be large, i have a client lined up which could bring in around آ£1.5million profit over a period of time.

[eimanshalash]

Originally posted by LexUK
Hello,

I need someone to confirm my information for withdrawing profits from a business bank account for an LLP.

Im assuming that i can take my share of the profits when i want or leave however much i want in the business bank account to be classed as a reinvestment. Im also assuming i only have to pay NI and income tax on the profits i have withdrawn from myself.

If im wrong please say so.

I don't have much advice apart from referring you to the IR and ask them. I'm sure there might be a workshop around to help you with this. I know there are ones for Ltd and soletrader workshops. Ask about LLP ones. I've been to these workshops and find them very helpful!! Well they have to be don't they javascript:smilie('')
big grin