PAYE tax credit for Proprietary director?

K

kev53

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Quick question, if somene is a PAYE employee and is a Proprietary director of another company but receives all income from the PAYE emplyment (i.e. not a dime as a Proprietary company director) can you still get the PAYE tax credit??
 
Once they have an employment that is eligible for the PAYE tax credit then they get it, regardless of other circumstances.
 
Many thanks J. Ryan, so even if the individual is registered for VAT and fills in tax return on Form 11 (on account of being a proprietary director), the PAYE tax credit should still apply, given all income is from PAYE employer and not a cent from the company?? Many thanks if you can confirm
 

Correct. The PAYE credit is given once the employment to which it is connected is not a proprietory directorship.
 
A related question, I assume flat rate expenses are also eligible in this case??
 
Graham, I'm confused again, note on a previous post you indicated
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Re: Company Directors & the PAYE tax credit
Self-employed (sole traders / partnerships) are not entitled to the PAYE credit. a company director with in excess of 15% shareholding is considered "proprietory" akin to self-employed and is treated the same way.

There has been another thread on this on AAM recently.



Is this different to the what you indicated in this tread?? i.e. that proprietory director with >15% holding IS entitled to the PAYE credit?? What is the difference??
 

The proprietory director with NO other employment is NOT entitled to the PAYE tax credit against the earnings from his proprietory directorship employment.

The proprietory director with BOTH a proprietory directorship employment AND a separate, unrelated, non-proprietory directorship employment IS entitled to the PAYE tax credit BUT against income from the non-proprietory directorship employment only.

So Joe Bloggs is a 50% shareholder & director in ABC Ltd. He had no other employments. He is not entitled to the PAYE tax credit.

If Joe Bloggs had another employment with XYZ Ltd where he had no ownership or directorship (or ownership of < 15% ) in addition to that with ABC Ltd, then he would be entitled to the PAYE Tax Credit against the employment with XYZ Ltd. If the employment income from XYZ Ltd was insufficient to absorb the PAYE Tax Credit then any excess in the credit is not allowable against the other employment, it is lost.
 
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