New proposal from IPSE - Smoke and mirrors?

[tractor]

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I'm assuming that a FLC would be taxed the same as self-employed if it did go ahead, so no Employer's NI. Just class 4 NIC's.

Would FLC mean we could operate as the same entity i.e. Self Employed with the protection of a LTD and just put all our Income/Expenditure on our self assessment and not need accountants to manage the company accounts.

Your assumption is entirely wrong. Take a look at last week's CUK article by Philip Ross. When he comes back to answer the questions he has been asked, he will no doubt tell you what he thinks is a fair salary/dividend split and who is going to set that for you.

[BlueSharp]

Your assumption is entirely wrong. Take a look at last week's CUK article by Philip Ross. When he comes back to answer the questions he has been asked, he will no doubt tell you what he thinks is a fair salary/dividend split and who is going to set that for you.

Thanks, Just read it. It was not on the FP so took a little digging link below if anyone else missed it.

Why the UK should form a Freelancer Limited Company (FLC) :: Contractor UK

So the Div/Salary split could be set by someone else and not tied to the self-employed, but still retain the carry forward of profit and need for an accountant. Looks like their is also a requirement to still prove your not employed with the proposal which kinda makes the whole thing pointless as that's the current thinking of IR35.

[TheFaQQer]

Your assumption is entirely wrong. Take a look at last week's CUK article by Philip Ross. When he comes back to answer the questions he has been asked, he will no doubt tell you what he thinks is a fair salary/dividend split and who is going to set that for you.

Have a look at how the Americans deal with is - Salary Net Income, s-corp, s-corporation | The Self Directed IRA Handbook

• You should pay yourself a market rate
• If you have employees, yours should be the highest salary
• If you work full time, then pay a higher salary
• If you work in professional services, then take a higher salary
• You pay no corporation tax
• You pay income tax (and FICA) on profits instead

Doesn't look good to me, thanks.

[mudskipper]

Your assumption is entirely wrong. Take a look at last week's CUK article by Philip Ross. When he comes back to answer the questions he has been asked, he will no doubt tell you what he thinks is a fair salary/dividend split and who is going to set that for you.

Based on LFIG's proposal. We don't know if the assumption is wrong based on the ipse proposal, because there is no detail of what the proposal is yet...

[Zero Liability]

Sticks and stones may break my bones, but you can f*** right off if you think I'm paying more tax just because you call me a name.

They're the same people who will no doubt put money in an ISA and pension and fail to see the difference.

[BlueSharp]

Based on LFIG's proposal. We don't know if the assumption is wrong based on the ipse proposal, because there is no detail of what the proposal is yet...

Have a look at how the Americans deal with is - Salary Net Income, s-corp, s-corporation | The Self Directed IRA Handbook

• You should pay yourself a market rate
• If you have employees, yours should be the highest salary
• If you work full time, then pay a higher salary
• If you work in professional services, then take a higher salary
• You pay no corporation tax
• You pay income tax (and FICA) on profits instead

Doesn't look good to me, thanks.

At the bottom of the USA model there is a reference to

As a general rule, we recommend that business owners take at least 1/3 of their income as salary and pay self employment tax on those amounts.

.

[malvolio]

At the bottom of the USA model there is a reference to .

Remind me, when did we become subject to American legislation?

[TykeMerc]

Remind me, when did we become subject to American legislation?

You're not stupid, don't behave like it.

He's simply posted a scenario that; in the case of a new corporate vehicle being created; could wind up as reality. It's not likely, but it's every bit as possible as any warm and fluffy alternatives that IPSE may care to daydream about.

[TheFaQQer]

Remind me, when did we become subject to American legislation?

We didn't. However, as you well know, IPSE are looking at various models from around the world - of which this is one.

If the American S company model isn't something that the team are looking at, then goodness knows what they are doing.

[tractor]

.....

Remind me, when did we become subject to American legislation?

You don't need to be reminded. You said a few posts back it's coming and have said several times that we have to be able to make our own proposal. You have also stated here and over there that the gov is looking at other countries models including the German one. Why would they not take into account the US model when determining what we get?