Nervous newbie

[eurekapowers]

Hi

I dont know this question would have been answered millions of time but if you guide that would be a bonus

I have just started working as a contractor been three weeks now. My accountant has filed my HMRC paye and VAT flat rate application which would take a bit time to set up. I have recived payment for my last two weeks. since, I have started working can I withdraw my first salary?

Do I just transfer money as if it was just a normal transfer ?
I beleive its £10000 for this year so shall I withdraw £ 833 ? would that be ok to withdraw it right now while my Paye app is still pending? also I spent some money like travelling, books, stationary in december after I opened my company could I transfer that money frm Business to current account?

I know my accountant could answer just wanted to your opinion

thanks
Ad

[stek]

You are legally required to provide all your employees with a payslip.

[TheCyclingProgrammer]

You can't pay yourself a "salary" until your PAYE registration is sorted out, although you could pay a dividend if there are sufficient profits or take a small director's loan and repay it when your PAYE is sorted out.

The best thing to do is tell your accountant you need to take some funds from the company now and ask them how they would prefer the drawings to be treated - they should tell you to either treat it as a director's loan or as a dividend but the latter requires the right paperwork.

Keep records of the expenses you have paid for. You need to distinguish between company business expenses (I would put stationary and the books, if relevant to your trade, under this bracket) and your personal business expenses (travel, accommodation and subsistence normally).

YourCo can normally reimburse you for the former without any tax or reporting implications but you need to be aware of the various rules regarding the latter (and they will need to be reported on your P11D). As a general rule, now you have a business bank account and money in it, try and pay for all company expenses direct from the company account as it is a good idea to keep company and personal out of pocket expenses separate IMO.

Again, your accountant should be helping you with all this.

[PerfectStorm]

Don't be afraid to ask your accountant questions which you feel they would assume you know the answers to - they don't assume this. They're there to advise you, right down to how much the salary is and when and how you pay it. Give them a call, say that you'd like to transfer some money asap and ask what the best way would be. Get your moneys worth out of them!

My accountants (Nixon Williams) send me a payslip PDF once a month and I do a bank transfer for the indicated amount (which changes occasionally based on very minor taxes here and there). The first month or two are always a special case, so just ask.

[northernladuk]

Actually I don't think this has been answered a million times. Most people trust their accountant and let them sort it out.

[ContrataxLtd]

Hi Ad

Speak to your accountant and they should be able to sort all this out for you, they should advise you on the most tax efficient setup to take.

You have plenty of options for withdrawing money from the company and PAYE is one of these, even though the scheme hasn't been setup yet. You can process the salary through payroll then send an RTI submission once the references come through. Again, your accountant will probably be taking care of this for you.

Martin
Contratax Ltd

[jamesbrown]

Hi Ad

Speak to your accountant and they should be able to sort all this out for you, they should advise you on the most tax efficient setup to take.

You have plenty of options for withdrawing money from the company and PAYE is one of these, even though the scheme hasn't been setup yet. You can process the salary through payroll then send an RTI submission once the references come through. Again, your accountant will probably be taking care of this for you.

Martin
Contratax Ltd

Interesting, I thought the RTI submission always had to precede the payment...

[ContrataxLtd]

Interesting, I thought the RTI submission always had to precede the payment...

Normally it does under the 'on or before' payment rules, however, when you are first setting up the scheme you are allowed to pay your employees as normal and bring the RTI submissions up to date once the references are received.

I believe this is so that you can still pay employees when trade first commences and aren't held up by possible HMRC delays as the references can take a couple of weeks to arrive.

Martin
Contratax Ltd

[jamesbrown]

Normally it does under the 'on or before' payment rules, however, when you are first setting up the scheme you are allowed to pay your employees as normal and bring the RTI submissions up to date once the references are received.

I believe this is so that you can still pay employees when trade first commences and aren't held up by possible HMRC delays as the references can take a couple of weeks to arrive.

Martin
Contratax Ltd

Thanks, good info.

[tarbera]

Is your accountant a contractor accountant or someone you just picked at random ?