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According to a new survey carried out by Alliance & Leicester, one in five small business owners view tax astheir greatest concern. The Chancellor has announced in hislast budget that companies with profits below ?10,000 willnot have to pay any corporation tax with effect from 1 April2002. The question to be asked is: does that announcementmake incorporation a more attractive option compared tobeing a sole trader?The answer is that from a tax point of view, it isadvantageous to trade through a limited company as longas the income is drawn from the company by the owners asdividends from their shares and the amount of dividendsdrawn is restricted below the 40% band rate (i.e. ?31,063for tax year 2002/03). That way, the owners have no furtherpersonal tax (“income tax”) to pay. Moreover, dividends arenot subject to national insurance contributions. This isexcellent news of course. But, if dividend income fallswithin the higher rate bracket of income tax (i.e. above?34,515), they will be taxed at 22.5% on the excess, whichof course will increase the tax burden. The company profitsare subject to corporation tax rates. Those are lower thanincome tax rates.The most catastrophic scenario is when the director takeshis reward from the company as salary. Then his/her salaryis taxed at income tax rates (like a sole trader’s income).That is because, unlike sole traders, the tax system treatscompanies as separate from their owners because a company isa separate legal entity. The problem is that the incometaxes are higher than corporation tax rates. On top ofthat, they will be subject to employee and employer nationalinsurance contributions, which of course increase the taxburden and render his position worse than even anunincorporated business (“sole trader”), because NIC Class 1on payroll are higher than NIC Class 2 paid by selfemployed.In contrast, a self employed person (“sole trader”) is taxedat income tax rates on the profits from his business, whichare added to his other sources of income. As it has alreadybeen mentioned, income tax rates are overall higher thancorporation tax rates. On top of income tax, nationalinsurance contributions class 4 are payable on the businessprofits within a specified band (7% on profits between?4,615and ?30,420). National insurance contributions Class 2are also paid by self-employed people, although those arelower than those payable by company directors on theirsalaries.To illustrate the above, let’s take a simple example. Wehave a limited company and a sole trader. They both make?60,000 profits each in the tax year 2002/03. We assume thatthe company director takes a salary equal to the amount ofhis personal allowances (untaxed income) of ?4,615 and thebalance as dividends. The company will pay corporation taxat 19% equal to ?10,523 and nothing else. The sole traderwill pay income tax ?16,542, National insurance Class 2 ?104and National insurance Class 4 ?1,806. Total ?18,452. Thebottom line is that the person that has incorporated hisbusiness into a limited company will make a tax saving of?7,929 compared to a sole trader! Isn’t that fantastic?Somebody might be wondering: why is this entire happening?The official explanation is that, this government, to helpthe economy grow, encourages people to leave as much profitswithin their businesses to be reinvested, instead of beingtaken out and spent.The “unofficial line” is that, as a matter of fact, foryears the Inland Revenue has tried to reclassify theself-employed. The 1% in NIC hike on staff salaries abovethe NIC threshold from next April adds to both theemployees’ and employers’ tax burden and may more thanoffset the saving from the corporation tax zero rate on thefirst ?10,000 of profits.Aren’t there any other matters to consider in decidingwhether to incorporate or not?Higher administration costs to comply with company law,payroll and bookkeeping is one factor. Another issue ispension planning. Extracting profits out of the company asdividends rather than salary means that there will be no”net relevant earnings” and therefore pension contributionscan’t be made. But the advent of stakeholder pension planshas meant that contributions up to ?3,600 per year can bemade without the need for any earnings. If a person does notwish to transfer funds in existing plans into stakeholderbecause of high charges, there is a way out: the best netrelevant earnings (i.e. salary) in five consecutive yearscan be used for making contributions for the next fiveyears, even if there were no salaries in the remainder fouryears. It is comforting to know that entitlement to basicstate pension is not affected by taking a salary from thecompany at the level of a person’s personal allowances i.e.?4,615.Furthermore, an individual may decide not to bother withpension plans and instead invest in ISA. Often, these can bemore efficient than pensions but that’s beside the scope ofthis article. If that option is taken, no salary isnecessary.Another factor is business motoring. It might be taxadvantageous for an unincorporated business that owns manycars not to incorporate because if these cars have someprivate use there will be benefits in kind taxed on theusers. These are generally higher than the straightapportionment between private and business for all carrunning costs in the case of sole traders.The conclusion is that there can be considerable tax savingswaiting the sole trader who decides to go down theroad to incorporation. But, one needs to proceed withcaution and careful planning. And don’t forget the biggestadvantage of incorporation, which is Protectionfrom Personal Liability. Incorporating is one of the bestways to protect a business owner from personal liability.Shareholders of a company are generally not liable for theobligations of the company. Creditors of a company may seekpayment from its assets, but not the assets of theshareholders. This means that business owners may engage inbusiness without risking their homes or other personalproperty.Thank you for taking the time to read this Article. I hopeyou’ve found it useful. If you have, please drop me an emailand let me know what you think.You can email me at…constantinesavva@accamail.comAlternatively, you can visit our website athttp://www.tax-accounting-london.info and read a series ofother full length articles that present the complete pictureon a variety of interesting topics.If you would like to know how to save tax and make sure thatmore of your hard earned cash stays with you to expand yourbusiness and increase your profits, we have a Free SpecialReport addressed to small businesses either starting up oralready in business. This Exclusive Free Special Report isavailable automatically when you subscribe to our regularseries of Free Newsletters on finance advice and taxplanning by visiting our subscription area on our websitewww.tax-accounting- london.info. It is complied from reallife situations dealing with small business tax affairs forover 10 years and it is loaded with down-to-earth advice andpractical, understandable examples.LEGAL NOTICEWhilst every care has been taken in the preparation of thisarticle, the author cannot accept responsibility for anyerrors or omissions. Proper professional advice should betaken at all times.We retain copyright for the contents of this article. Anyunauthorized copying or onward distributions are prohibitedwithout our consent.

10×16 storage shed plans

by

allan shakar

10×16 storage shed plans may only be one of the things you are looking for before getting started on that back yard project.

No matter what it is you are looking for it is important you get something that isn’t going to give you a headache by the time the day is half over.

We can sit back and watch a carpenter build almost anything and wonder why there is even training in such a trade until we have to do the project ourselves. The thing is when the time comes for you to strap on your tool belt and get to work most people don’t get much further than filling their pockets with nails.

If by some chance you do get the project some what finished you have used a lot more time than you had and ended up with an inferior product. When looking through 10×16 storage shed plans you will quickly see there are at least a minimum of 50 different items that you will need. Some are simple and you will understand what they are right away but others will seem like you are being talked to in a different language.

Now you see why a carpenter is a trade that involves a lot of skillful training. So now you need to get back to basics. You need to find a set of blueprints and instructions that will hold your hand every step of the way. You are going to want pictures and lots of them. You want exact measurements. You want definitions for the tools and materials that you need and you want exact step by step plans to get your project off the ground.

So welcome to the great world of the Internet where if you try hard enough you can find anything you desire. This includes 10×16 storage shed plans.

The problem still lies in finding the right ones for your project and not the ones that the carpenters are using. In the real world of carpentry there are going to be a large number of terms that you will hear that you will have no clue to their meaning. That’s okay though. Going through life knowing woodworking terminology really shouldn’t be a requirement. That’s why you want something kind of like building sheds for anyone. Something that will work in your favor by giving you real world definitions and exact step by step instructions.

You can be happy in knowing that out there you can find such things. The plans that will make your life easier and you can get started with 10×16 storage shed plans.

You are more than welcome to go in search on the internet for your 10×16 storage shed plans.

Or you can make things much easier and visit Blair’s website. He gives you the access to almost any shed or work project plans you can think of.

While at his website be sure to get your free storage shed plans.

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10×12 storage shed plans

Visit

http://plansforstorageshed.com/

Article Source:

ArticleRich.com