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  1. #1

    Nervous Newbie


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    Default Help.... lost...tax....aaaagh contractor/permanent

    Hi,

    I have paid tax and ni on job that i was made redundant from in this tax year, i am starting to do some contractor work in the same tax year. i am reading that i will pay 2 lots of ni one as employer and one as employee amounting to approx 25% plus my tax which seems a lot and a little unfair, my problem is im unsure how much money i can use from contractor earning to ensure there is enough left in the account for the tax man. i would appreciate a conversation with someone who could shine some light on my situation.

    Bonus question.... can i just withdraw as dividends (ensuring i leave 20% for hmrc) seeing i have already paid NI this year through my full time job i was made redundant from?

    Thanks

  2. #2
    pr1
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    Fingers like lightning


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    you need an accountant

  3. #3
    eek
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    bored now

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    Quote Originally Posted by pr1 View Post
    you need an accountant
    or join a proper legal umbrella and get them to handle the payments for you....
    merely at clientco for the entertainment

  4. #4

    Faqqed Off

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    You'll only need to pay NI on salary - so if you've already paid enough this year to count as a qualifying year, then you don't need to pay salary at all (technically you never need to pay salary, but that's a different discussion).

    You'll need to account for VAT (if VAT registered) and corporation tax. So knock the VAT off the invoices because that's not your money anyway. Then knock off the valid business expenses from the turnover. Then knock off 20% for corporation tax.

    Or get an accountant who will make sure that I'm right and you're on the correct path. Which is much better advice than the rest of my post.
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  5. #5

    TykeLike

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    Go brolly, give them your P45 from the last job and let them work out what is what and you pay them for the privilege.
    “Live a good life. If there are gods and they are just, then they will not care how devout you have been, but will welcome you based on the virtues you have lived by. If there are gods, but unjust, then you should not want to worship them. If there are no gods, then you will be gone, but will have lived a noble life that will live on in the memories of your loved ones.”

    ― Marcus Aurelius

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    Respect my authoritah!

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    Quote Originally Posted by SimonMac View Post
    Go brolly, give them your P45 from the last job and let them work out what is what and you pay them for the privilege.
    And give them control of your fees... but still better than screwing up your taxes.

    btw - why do you think it's unfair? When you were employed NI was deducted from your salary, and your employer paid their share. Now you employ yourself through your own ltd company - why should it be any different?
    You won. Get over it.

    --drunk on abuse of power--

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    Godlike


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    Go brolly until the end of the tax year and then form your own company.
    The greatest trick the devil ever pulled was convincing the world that he didn't exist

  8. #8

    Nice But Dim

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    Ring a few of the recommended accountants on here and have a chat with them about your circumstances. They will be happy to outline what you need to do without commitment to signing up with them. Choose one you are happy with.

    If you dont get it right you could end up facing a sudden, and rather large, tax bill.
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    My post count is Majestic

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    Quote Originally Posted by aafps View Post
    Hi,

    I have paid tax and ni on job that i was made redundant from in this tax year, i am starting to do some contractor work in the same tax year. i am reading that i will pay 2 lots of ni one as employer and one as employee amounting to approx 25% plus my tax which seems a lot and a little unfair, my problem is im unsure how much money i can use from contractor earning to ensure there is enough left in the account for the tax man. i would appreciate a conversation with someone who could shine some light on my situation.

    Bonus question.... can i just withdraw as dividends (ensuring i leave 20% for hmrc) seeing i have already paid NI this year through my full time job i was made redundant from?

    Thanks
    Where is VAT in all this? You have considered VAT yes?
    You know you can only pull dividends from profit?

    Umbrella is the way for you.
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  10. #10

    Double Godlike!

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    Quote Originally Posted by aafps View Post
    Hi,

    I have paid tax and ni on job that i was made redundant from in this tax year, i am starting to do some contractor work in the same tax year. i am reading that i will pay 2 lots of ni one as employer and one as employee amounting to approx 25% plus my tax which seems a lot and a little unfair, my problem is im unsure how much money i can use from contractor earning to ensure there is enough left in the account for the tax man. i would appreciate a conversation with someone who could shine some light on my situation.

    Bonus question.... can i just withdraw as dividends (ensuring i leave 20% for hmrc) seeing i have already paid NI this year through my full time job i was made redundant from?

    Thanks
    Engage an accountant asap, you can't do this this on your own or ask random strangers on a forum.

    Get this wrong and Hector (the Tax Inspector) will rip you a new arsehole.

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