I am trying to record a wages payment to a director but we aren’t registered for PAYE (both Directors pay tax through Self Assessment). Do I still select the ‘Enmployee Salary (PAYE)’?
If the directors are also shareholders in the company then it’s most probably a dividend you are paying.
You can find more about paying dividends here.
Hi Glenn,
No, this is a payment given for a few hours work the Director does and it is in addition to the Dividend allocated.
I’d have a chat with your accountant on this one, there are limited ways you can remunerate directors.
The most common are as follows.
- PAYE, although don’t use this option if you’re not registered for PAYE.
- Dividends, distributed from company profits, payable to shareholders.
- Sub-contracted, although restrictions may apply here so it’s advisable to seek professional advice.
Okay will do, thanks Glenn
Why couldn’t the company pay a salary to a director? If he is not UK resident it shouldn’t be necessary to register for PAYE. In this case, would you credit 7004 regular wages account?