I’m new to the contracting world (oil and gas industry). I’ve been doing this for 4 months now and the company bank balance is thankfully growing at a rapid rate.

Can anyone advise a legitimate way to extract the money in a tax efficient manner? I’m not talking about basic strategies such as optimal salary, dividends and legitimate expenses as I’m already doing that. I would really like to know how to get significant amounts out. I’d like to have access to the money to pay for private schooling or mortgage.

A contractor friend of mine use to regularly wind up his company, make himself redundant, and give himself a big payoff (I think 30k is tax free). He’d then start up another ltd company to work through. I’d definitely check with a good accountant before giving this a go though!

K2 Tax Avoidance – Alternative

here you go, loads of variations on the k2 theme (AKA the Jimmy Carr solution).

All of them IMO sailing fairly close to the wind with regards to risk levels.

I’m not talking about basic strategies such as optimal salary, dividends and legitimate expenses as I’m already doing that

Are you sure, it took me +5 years to get really good at this and I know from talking to our Accountants that I was very efficient.

One thing that worked for us was that both of us contracted so all money could be divided across both of us, irrelevant who ‘earned’ what and when.

Beyond this it could easily be cheaper to borrow any extra cash you need rather than take it out, due to the sheer cost of tax and NI (employee and employer).

Best way is to pay some of it to an accountant.

give it to me is very efficient 😆

Is it a bit smelly under that bridge? Cos I smell troll!

Julians – thanks for the link. I agree it does look a bit fishy. I’d rather not attract the attention of HMRC in my first year in business.

B r – I’m a little confused as to how a loan is cheaper. Can you elaborate? If I get a loan then I still need money to pay it off and the only extra money I have is ‘stuck’ in the company bank account.