Year End Tax Review 2009/2010 Contents Lead articles The year ahead... This year, next year Pension hit Employees Too much NIC NIC and pensions Company cars Tax-free benefits Business - General Time to incorporate? His and hers Family bonus Profit and loss Show me the money Can't pay, won't pay? Turning back the clock Business - VAT Standard VAT or flat VAT? VAT goes down - must come up? European revolution A good start for VAT Happy returns? Investments Top-up savings Rainy day money Capital Gains Gains favoured Splitting gains A place in the country Holiday lets end Families Family fortunes Where there's a Will Credits and debits Piggy banks Still trustworthy? Administration Penalty shoot-out Paperwork, paperwork Pay tax later Opportunity knocks again Charity Give and save Non-Domiciled People Home and away Interest Interesting times

Show me the money Because corporation tax rates are lower than the top rate of income tax, company owners may save money by leaving their profits in the business. The company pays tax at 21% in 2009/10, but if the profit is paid out the owners will pay more tax on the remaining 79%. The problem is that the point of making a profit is usually to spend it on yourself and your family - if it's locked up in the company, that's no good. There are very different tax charges which apply to the different ways of taking money out of a company, as well as company law rules which prohibit some transactions, such as dividends where there are no accumulated profits. As the Chancellor keeps changing the tax rates for all the taxes involved - corporation tax, income tax on salaries, interest and dividends, and NIC - the best course of action can change from year to year. If you are thinking of winding up or selling the business, a new range of possibilities has to be considered. The difference can be substantial - it's something that's well worth taking advice on. Action Point! What's the best way to get profit out of your company?