How Does A Remuneration Trust Work

A company owner, Director, LLP Partner, Partner in a Business Partnership, Sole Trader or someone with income that is not processed through the PAYE system can use a  Remuneration Trust.
The basics are: Income and / or company profits are contributed to a remuneration trust. Because the contribution is being paid into a Trust then there is usually no tax payable on the contribution.

Is This Very Complex

Behind the scenes the construction of the Remuneration Trust is extremely technical and complex but the trust application is quite straightforward.

The Remuneration Trust is designed to deliver more versatile financial options for Companies, Partnerships and Sole Traders when reaching decisions. For instance, on choices to offer further benefits to suppliers and service providers. The Remuneration trust is designed to extend available incentive resources by way of legal (and secure) wealth-saving techniques, as well as lessen liabilities.

The current economic environment, as well as the difficulties this creates to business and financial management, suggests that organisations and individuals are seeking sensible approaches to effectively incentivise suppliers and service providers.

Whilst conventional salary payment models, such as bonuses and dividends, are helpful, a remuneration trust could also be used as a possible incentive that could offer more significant financial freedom, and improve current funds available.

A remuneration trust is actually a device that enables profit from a UK limited Company to be deducted as an expense. The trust enhances accessible wealth by minimizing liabilities and making the trust funds available to trust beneficiaries via a more effective channel.

General Guidance For The Remuneration Trust

The content presented here is of a general nature, and utilizing a Remuneration Trust is actually a complicated area, demanding specialized knowledge.

Consequently, our recommendation is that professional guidance is sought for every unique set of circumstances of your Business and employees. We will not accept any legal responsibility for any action taken resulting from the information contained herein, and this isn’t supposed to be a comprehensive legal declaration in respect of the common use of remuneration trusts. No Remuneration Trusts are recommended here, in fact a Remuneration Trust may not be suitable for your particular circumstances.

Professional advice is offered through Stuarts Green Consultancy. Please speak to us for further information; we will be pleased to discuss Remuneration Trust suitability for your circumstances in greater detail.

             0800 1300 534