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Minimising corporate taxes with expenses and how to create receipts or invoices
Hi everyone,
I have a trustee company that is a registered company running a trust holding my family’s investment assets. I write a newsletter that I receive contractor fees paid to this trustee company.
I have significant reported profits from contractor fees and capital gains distributed from my investment trust but I have decided to have my wife and I as the directors of the company receive monthly payments out of the trustee company as dividends. We kind of have a problem where we do not have enough expenses that we can book into the trustee company as a result.
This has left our family with a bit of a cashflow problem in the last year and a half as our investments have been in a bear market. We have significant taxes to pay out of our trustee company as it is subject to a pay as you earn arrangement and the quarterly business activity statement calculated our tax payable by assuming last year’s tax bill.
I currently hire someone as an analyst to do some research for me that I pay in cash from my personal account, which I record monthly as a research expense on the company. I also record quarterly rent, utilities and internet expenses paid to myself.
My question is whether I can argue that the company is reimbursing me for these expenses that I pay personally without requiring a receipt because these are payments to sustain me as a living man? Also, what other ways can I find invoices or receipts that I can use to record further expenses that I can put on the company? Do I need to show movement in the bank balance in order for the receipts to count as expenses? Or can I just book the expenses without a cash withdrawal out of the company, or can I just issue shares from my company as a beneficial interest?
I need some suggestions from those with an experience in this so to help me out of this awkward situation.
Thank you!
God bless,
Brian
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2 Replies
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Hi Brian, Mark has had the most experience in this area, so if you look out for a Q and A webinar and ask him there and be sure to get to any Q and A webinar promptly/early then cut an paste
your question in immediately it begins to ensure he has time to answer
your question. Alternatively attend the next webinar; http://solutionsempowerment.org/event/webinar-how-to-successfully-exit-your-offspring-from-the-formal-school-system-home-school/, then in the Q and A section at the end of that (approx 1 hour in) you could ask your question of him.Webinar: How To Successfully ‘Exit’ Your Offspring From The Formal School System & Home School
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Thank you Janet. I’ll try to do that!
God bless,
Brian