First wage slip

oafc0000 · 9th May 2008, 18:15

Hi All

I am a little confused by my first pay slip and I have a few questions.

My contract is IR35 caught so my total invoice is taken as a salary and I am a LTD. My wage slips shows how much money is due to me and how much money is due for the tax man (PAYE). It shows the NI Employer and Employees contribution as being 0 ?

Surely that isn’t right ? I am yet to send them my P45 from my old company as that is taking some time to arrive. Could that be the problem ?

Thanks for any help, if you need more details just let me know. Would ask the accountant but he isn’t around until Monday.

Thanks

Danbro · 9th May 2008, 18:45

Quote:

Originally Posted by oafc0000

Hi All

I am a little confused by my first pay slip and I have a few questions.

My contract is IR35 caught so my total invoice is taken as a salary and I am a LTD. My wage slips shows how much money is due to me and how much money is due for the tax man (PAYE). It shows the NI Employer and Employees contribution as being 0 ?

Surely that isn’t right ? I am yet to send them my P45 from my old company as that is taking some time to arrive. Could that be the problem ?

Thanks for any help, if you need more details just let me know. Would ask the accountant but he isn’t around until Monday.

Thanks

Hi,

This will almost certainly be due to your wage being calculated using the Directors rules for National Insurance, these rules mean that your first £5435 for 08/09 are taxed at 0% immediately and not pro-rat'd over the year like normal employees, therefore until your total salary for 08/09 exceeds £5435 your national insurance will be nil, then after this your total pay will incur 11% e'ees NI and 12.8% e'ers NI

Thanks
Neil

NotAllThere · 9th May 2008, 20:01

If you're IR35 caught it should be 95% of your income as salary.

malvolio · 10th May 2008, 07:07

If you have a limnited company, why are you getting a payslip? They should pay you gross and it's up to you to sort out the tax.

Don't really understand this "contracting" lark, do you.

monkeyBoy32 · 10th May 2008, 07:20

Quote:

Originally Posted by malvolio

If you have a limnited company, why are you getting a payslip? They should pay you gross and it's up to you to sort out the tax.

Don't really understand this "contracting" lark, do you.

Maybe he means that he gets his payslip from his accountant which is correct if he's caught by ir35 and being paid a full sallary.

oafc0000 · 10th May 2008, 08:08

Quote:

Originally Posted by monkeyBoy32

Maybe he means that he gets his payslip from his accountant which is correct if he's caught by ir35 and being paid a full sallary.

Bingo...

oafc0000 · 10th May 2008, 08:09

Quote:

Originally Posted by malvolio

If you have a limnited company, why are you getting a payslip? They should pay you gross and it's up to you to sort out the tax.

Don't really understand this "contracting" lark, do you.

....its funny when people have a pop and then come out looking silly....

oafc0000 · 10th May 2008, 08:10

Quote:

Originally Posted by Danbro

Hi,

This will almost certainly be due to your wage being calculated using the Directors rules for National Insurance, these rules mean that your first £5435 for 08/09 are taxed at 0% immediately and not pro-rat'd over the year like normal employees, therefore until your total salary for 08/09 exceeds £5435 your national insurance will be nil, then after this your total pay will incur 11% e'ees NI and 12.8% e'ers NI

Thanks
Neil

Thanks for that Neil.....

I would of doubled checked with the accountant but they are closed over the weekend.

Great news when you miss something and it actually lands more money in your lap

oafc0000 · 10th May 2008, 08:11

Quote:

Originally Posted by NotAllThere

If you're IR35 caught it should be 95% of your income as salary.

Yeah and its been done that way....cheers for the reminder though...

malvolio · 10th May 2008, 08:16

Quote:

Originally Posted by oafc0000

....its funny when people have a pop and then come out looking silly....

Not half as funny as trying to interpret questions with half the facts missing...

Out of interest, and as a bit of genuine research, why is your contact IR35-caught? The reason for asking is that with 99.65% of contracts challenged being found outside, it would be useful to understand why people continue to pay it so we can challenge its whole basis. There is a suspicion that it survives as a tax because too many people are paying up whether they are caught or not.