Jack Kelly wrote:
> Hi there,
>
> I am a PhD student in London and I plan to set-up a small film
production
> company with some friends. We intend to register a Ltd Company at
Companies
> House within the next week or so.
>
> How will this affect my student tax status? For example, will being a
> company director mean that I'll have to give up the tax benefits of
being a
> student? If so, are there any ways round this problem (e.g. becoming a
> secretary rather than a director)?
>
First point: I was not aware that "student status" gave any advantages
for tax purposes. I never found any difference in treatment between when
I have been a student and when I haven't.
Second point: as far as I know, being a company director doesn't make
any difference at all to one's tax status. Certainly when I was a
director it made no difference to me. Why should it?
Two things make a difference to tax status as far as I can remember: (1)
what you earn (2) whether you are self-employed or not. Putting it very
simply.
If you start paying yourself out of the dividends, or the company is
really a sham personal services company, that might have some effect,
but otherwise I don't see why it should. If you are an employee of the
company, that might make a difference, but there is no reason (again)
why you should be.
Francis Davey
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