Tier 1 Earnings Query - Limited company

Hi Mate
I have Tier 1 visa. Recently I changed my job and start working as Contractor under self managed limited company and recieve money from company as Basic Salary + Dividend due to tax efficiency.

I issued invoice every last Friday of Month and recieved payment 20 of following month e.g. invoice issued for the period from 01/10/2013 28/10/2013 on 30 of 30/10/2013 and will recieve the payment on 20/11/2013.

My first question is my earning year will start from
01/10/2013 - month start OR
30/10/2013 - Invoice Date
20/11/2013 - Invoice recieved Date

Please explain what day I pay salary and dividend to me
on Invoice date OR
Invoice Recieve Date

Please explain keeping in view UKBA rules.

From whenever date you issued yourself a wage slip for salary under the HMRC PAYE system and whatever date you issued the Dividend voucher duly minuted and formally issued.

You have registered for PAYE and you do have an Accountant?

Thanks for your reply.

Yes I got the accountant but he suggest me to recieve salary and dividend end of each month. I am just confused end of month I dont recieve the invoice payment. My agency pay me 20th of following month. As UKBA dont consider the credit sale. In this case will they consider my pay and dividend before the invoice recieve.

My accountant dont know anything about UKBA rules

NARMAK wrote:Thanks for your reply.

Yes I got the accountant but he suggest me to recieve salary and dividend end of each month. I am just confused end of month I dont recieve the invoice payment. My agency pay me 20th of following month. As UKBA dont consider the credit sale. In this case will they consider my pay and dividend before the invoice recieve.

My accountant dont know anything about UKBA rules

Remember your Ltd is totally separate from you, all that matters for you personally is the salary and dividend and they days you are paid them.

The dates your Ltd is paid is of no relevance.

Wanderer wrote:

NARMAK wrote:Thanks for your reply.

Yes I got the accountant but he suggest me to recieve salary and dividend end of each month. I am just confused end of month I dont recieve the invoice payment. My agency pay me 20th of following month. As UKBA dont consider the credit sale. In this case will they consider my pay and dividend before the invoice recieve.

My accountant dont know anything about UKBA rules

Remember your Ltd is totally separate from you, all that matters for you personally is the salary and dividend and they days you are paid them.

The dates your Ltd is paid is of no relevance.

Thanks, Its clear to me now.

NARMAK wrote:

Wanderer wrote:

NARMAK wrote:Thanks for your reply.

Yes I got the accountant but he suggest me to recieve salary and dividend end of each month. I am just confused end of month I dont recieve the invoice payment. My agency pay me 20th of following month. As UKBA dont consider the credit sale. In this case will they consider my pay and dividend before the invoice recieve.

My accountant dont know anything about UKBA rules

Remember your Ltd is totally separate from you, all that matters for you personally is the salary and dividend and they days you are paid them.

The dates your Ltd is paid is of no relevance.

Thanks, Its clear to me now.

I had meeting with my accountant. He recomend me to take Salary equal to basic personal allowance £9440 and rest of money as Dividend. He advised me to charge only Accountancy fee, Professional and Public Liability insurance, Employer NI, Professional body monthly subcriptions £100 monthly as subsistance allowance and £100 monthly as travel allowance.

Is that Ok for UKBA rules

Please Reply

A similar query.

My Invoices are dated between Sep 2013 to April 2014. I have taken monthly salary each of these months and one single dividend of 25K in the month of April. From May onwards I intend to join a perm role.

I want to consider my 12 months period from Jan 2014 to Dec 2014, which will involve
1) Jan 2014- April 2014 salary from ltd company
2) 25K dividend taken in April 2014 from ltd company
3) salary from perm role between May to Dec 2014

My question is can I consider whole of 25K dividend taken as earnings during the period Jan 2014 to Dec 2014 ? I am not sure I can do this as some invoices are dated between Sept 2013 to Dec2013.

Note that if I exclude the invoices from Sept to Dec 2013 and consider only invoices from Jan 2014 to April 2014, the sum total earnings are less than 25K

Any accountant in this group or senior members please clarify!!! Thank you.

I think you are fine with the dividend as people can take interim dividend during the year in expectation of profit being made by the company. You have taken a final dividend (full and final). UKBA should not have any objection on that.

NARMAK wrote:.


I had meeting with my accountant. He recomend me to take Salary equal to basic personal allowance £9440 and rest of money as Dividend. He advised me to charge only Accountancy fee, Professional and Public Liability insurance, Employer NI, Professional body monthly subcriptions £100 monthly as subsistance allowance and £100 monthly as travel allowance.

Is that Ok for UKBA rules

Please Reply

He has advised you the normal expenses which one can and should claim. These are all fine as long as they leave enough profit for your dividend paid.

One needs to know that dividend is part of your personal income only when it is received. So you can make part of your personal income for your application.

Hello All,

I will be very thankful if somebody answer my question.

When calculating previous 12 months earning with limited company, my question is regarding dividends.

Does home office look into transaction dates in company account or just dividend taken date?

Further explanation of above question:

Example: Dividend transfer date to personal account from business account is 15/01/2014, that dividend is taken because of previous 3 months transactions in business account.
if I select previous 12 months start 01/01/2014 to 01/12/2014. Can that dividend be added into earnings? considering transaction taken place in 2013.

Thanks in advance.

Junaid