Celebrity Divorces

Since the beginning of the year there has been a recent rise in celebrity splits and divorces. New websites have included details of the alleged breakdown of relationships of Drew Barrymore and Will Copelman, Rebecca Adlington and Harry Needs, Professor Green and Millie Mackintosh and Nick Knowles and Jessica Knowles to name but a few.

The process of divorce in England and Wales has become a paperwork exercise as long as it is undefended and is usually a straightforward process. The petitioner must show that the marriage has broken down irretrievably and will also rely on one of five facts; the respondent’s unreasonable behaviour, the respondent’s desertion, the respondent’s adultery, 2 years separation with consent or 5 years separation. It should be noted that whilst the divorce process is usually straightforward, this does not deal with the finances of the parties which will need to be dealt with separately.

At Breeze and Wyles we offer a fixed fee divorce package at a cost of £499.99 inclusive of VAT plus the Court fee of £550.00. Our service enables you to be fully represented by a qualified specialist lawyer throughout your straightforward undefended divorce for a one-off fixed fee payment. Our experienced family lawyers will fully explain the divorce process to you and deal with any concerns or queries you may have. They will take responsibility for the preparation of all relevant forms and will deal with the Court on your behalf throughout the entire matter.

Breeze and Wyles are also able to offer expert advice in respect of all issues surrounding divorce or a relationship break up such as advice on financial settlements as well as matters relating to children.

Lisa Honey is a family solicitor at Breeze and Wyles Ltd specializing in family law and deals with matters covering a range of issues including divorce and financial settlements, separation following the breakdown of a relationship, children matters and declarations of trust. Lisa is also an honorary solicitor providing advice at the Citizens Advice Bureau in Cheshunt.

Website: www.firstfordivorce.co.uk

Email: lisa.honey@breezeandwyles.co.uk

Tel: 01992 558 411


Changes to Dividend Taxation from 6 April 2016

From 6 April 2016 the rules on Dividend Taxation have changed. This will have an impact on the way in which small single and multiple owner companies will chose to draw their profits or salaries.

Changes: 

  • The notional 10% tax credit on dividends has been abolished.
  • A £5,000 tax free dividend allowance has been introduced.
  • Dividends above this level are now to be taxed at 7.5% (basic rate), 32.5% (higher rate), and 38.1% (additional rate)
  • Dividends received by pensions and ISAs will be unaffected
  • Dividend income are to be treated as the top band of income.
  • Individuals who are basic rate payers who receive dividends of more than £5,001 will need to complete self assessment returns from 6 April 2016.

Impact

The changes have been brought in as a result of the proposed changes to Corporation Tax. In the next few year corporation tax is set to be reduced. The reason for this is to make the UK market more attractive to multi-national companies who want to find a home where lower taxation prevails; think Ireland and Luxembourg for instance. At the same time the government does not want to create a driver for most employees who can afford it to change from sole trader or employment status to incorporated status. In effect HM Government wish to maintain a parity of taxation between the various methods of working/trading/employment. The only way to do this is to address dividend taxation calculations so as to more closely align them from taxation basis to each other.

The result of the changes is that whereas previously but only marginally it was more tax advantageous to trade as an incorporated business it is now marginally more advantageous to trade as a sole practitioner/partnership. Of course this excludes the other reasons for making the decision as to how to trade such as

  • Limited liability
  • Retention of profits
  • Transfer of ownership
  • Borrowing

If you need help in relation to your company please contact me Brendan O’Brien at brendan.obrien@breezeandwyles.co.uk or my colleague Donna Bromyard at donna.bromyard@breezeandwyles.co.uk or by telephone at 01992 558411.


Call to Action: Persons with Significant Control and your obligations

As of the 6th of April Companies are required to maintain a new company register known as the Register of Persons with Significant Control.

What is the change?

From the 6th of April 2016 UK Companies will be required to maintain a register that shows certain information about persons who have, or who have the potential, to exercise significant control over the running of the company. So what is a PSC?

Condition:

 

What you need to consider:
(i) An individual who holds more than 25% of shares in the company. Review your company’s register of members and identify shareholdings of over 25%.
(ii) An individual who holds more than 25% of voting rights in the company. Review your company’s register of members, articles of association, and identify people with voting rights (often attached to shares) over 25%.
(iii) An individual who holds the right to appoint or remove the majority of the board of directors of the company Look at your company’s constitution, including articles of association, and identify whether anyone has this right. If there is only one director and someone has the right to appoint them, then they would meet this condition
(iv) An individual who has the right to exercise, or actually exercises, significant influence or control over the company. You would consider this where an individual does not meet one of conditions (i) to (iii) but does exercise ‘significant influence or control’ over the company. The statutory guidance sets out principles and situations where an individual would be a PSC
(v) Where a trust or firm would satisfy one of the first four conditions if it were an individual. Any individual holding the right to exercise, or actually exercising, significant influence or control over the activities of that trust or firm. If one of the above conditions is met by a trust or firm (without legal personality), read the relevant section in the statutory guidance to identify who should be included in the PSC register

Depending on who they are and how the control can be exercised the information to be retained in respect of the PSC will vary. But generally before a PSC can be entered on the register, you must confirm all the details with them. The details you require are:

  • name;
  • date of birth;
  • nationality;
  • country, state or part of the UK where the PSC usually lives;
  • service address;
  • usual residential address (this must not be disclosed when making your register available for inspection or providing copies of the PSC register);
  • the date he or she became a PSC in relation to the company (for existing companies the 6 April 2016 should be used);
  • which conditions for being a PSC are met;
  • for conditions (i) and (ii) this must include the level of their shares and voting rights, within the following categories:
    • Over 25% up to (and including) 50%,
    • More than 50% and less than 75%,
    • 75% or more;
  • the company is only required to identify whether a PSC meets condition (iv) if they do not exercise control through one or more of conditions (i) to (iii);

When do I have to comply?

A company will be required to maintain the register from 6 April 2016 and will need to file the information on the PSC Register with Companies House by 30 June 2016.

Why is the change necessary?

It can often be the case that companies are used to undertake criminal activities. The reason for this is that the ownership within a company can be hidden. In some jurisdictions the ownership of a company is updated annually by the use of an Annual Return process. This provides the public with a update on the change of ownership within a company on an infrequent basis. Even in these situation ownership of shares can be disguised through nominee relationships and trusts. However there are many jurisdictions around the globe where ownership is completely opaque as has been seen through the news in recent weeks.

However, in an attempt to create an even more transparent process regarding ownership HM Government has implemented this process.

What will be the cost to UK Companies?

Initially the cost is likely to be the cost of review of the shareholdings and company constitution. You will need to ensure that you comply and in time, as the Failure to provide accurate information on the PSC register and failure to comply with notices requiring someone to provide information are criminal offences, and may result in a fine and or a prison sentence of up to two years.

For companies whose shareholding changes very rarely, this may be a one off or fairly irregular cost. However for larger companies the impact will be greater.

What you should do now?

It is essential that if you are a director or company secretary you seek advice on what to do next and get underway with the process as the race has already started.

If you need help please contact me Brendan O’Brien at brendan.obrien@breezeandwyles.co.uk or my colleague Donna Bromyard at donna.bromyard@breezeandwyles.co.uk or by telephone at 01992 558411.