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Can a child hold shares in a company ?

Can a child hold shares in a company

There is no statutory provision prohibiting a child from owning shares.

Please note contracts cannot be forced against minor thus it’s advisable that that shares are fully paid up.

Dividend income is deemed under ITTOIA/S629 to be that of the parent for tax purposes, and is not treated as the child’s. So there is no tax advantage in holding shares in a child’s name.

I read a good article which gives alternatives to registering child as a shareholder. Click here.

If the client still wants to allot share to a child. Then a bare trust is needed. There is no legal requirement to create a formal document to create a bare trust.

Name in the register of members can be simply – Mr Parent as bare trustee of Mr Child.

National Minimum wage (NMW) a matter of months

What should be NMW for an employee who is 20 years and x months old.

My colleague Neel was working on a client and asked me this interesting question.

What should be NMW for an employee who is 20 years and x months old.

NMW is given in terms of whole years like

25 years and over                            £7.83

21 to 24                                                £7.38

18 to 20                                                £5.90

As always HMRC has been kind enough to make a manual about NMW and share it with us.

See link NMWM03050.

Its states that the worker should be paid £5.90 till he reaches his 21st birthday.

Tax answers at a Glance – a nice little book

I recently read a nice book  : Tax answers at a Glance written by authors from HM Williams Chartered Accountants.

Given below is few of things which I learnt:

  1. Gordon Brown started the trend of announcing tax rates for future years.
  2. When you buy petrol,  most of the monies goes to the Government c60-80% depending on the petrol prices. The petrol pump owner gets c1% , even the credit card company gets more to process the transaction. I thought the Sheikhs were making all these monies. See RAC website.
  3. Expenses allowed – Stationery :
    Allowed – reference books which are necessary for your job. Cost of stationery used strictly for your job.

Not allowed – Costs of books you feel you need to do your job properly, but which    are not necessary for it i.e. Subscription to journals to keep up with general news.

4. Working time directive cover domestic servants as well.

 

 

Link to publishers website

Construction Industry Scheme (CIS) and Restaurants

Restaurant carrying out their own construction are not covered by CIS

CIS Scheme is well covered by HMRC guide CIS 340.

Section 2.5 of the above mentioned guide makes it clear that expenditure incurred for own business is not covered by CIS scheme.

Thus, restaurants carrying out their own construction are not covered by CIS.

I also confirmed this by calling HMRC CIS general enquiries telephone line 0300 200 3210.

 

 

Making Rules

A gem by Lon Fuller legal philosopher 1902-1978.

Moral tale of King Rex and eight ways in which he fails to make laws:

1) Fails to make rules, so everything is decided on a adhoc basis.

2) Does not publicize the rules

3) Enacts retrospective laws

4) Incomprehensible laws

5) Contradictory laws

6) Rules that require conduct beyond power of affected parties

7) Introduces frequent changes

8) Fails to achieve congruence between rules announced and official action

In our daily lives sometimes we make rules which we ask others to follow and sometimes follow rules made by others.

May we make better rules !