Accountants

[cykophysh39]

So to clarify some points here

So for those of us who run limited company's , we don't need to worry about anything?

Our accountants carry on as normal.

We are elligble for 22% Corporation tax.

is this basically it?

[jh0711]

I don't agree we are all at risk. For example - What defines an accountant? maybe a firm that are recognised as accountants, that act for a variety of different businesses, are qualified, have PI insurance would be a pretty good start.

i have just had this very argument (heated discussion) in my place of work it seemed that you cannot set yourself up as an accountant in case your first 10 customers happen to all be 1 man limited co's in which case you would be acting illegally - which is ridiculous

i guess what they are trying to do is stop accountants setting up in business to purely use a minimal payment/dividends solution to attract people without allowing (and possible encouraging) them to operate their own PSC as a genuine business enterprise - with retained profit, certain capital expenditure, a proper marketing method etc.

we want some clarity!

[malvolio]

So to clarify some points here

So for those of us who run limited company's , we don't need to worry about anything?

Our accountants carry on as normal.

We are elligble for 22% Corporation tax.

is this basically it?

Ermm yes, basically - well, 19% right now, 20% from April 6th, increasing annually until it hits 22% in 2010/11 (and probably re-announced in every budget and PBR and speech until then).

It does highlight the problem though: we all know what an MSC is and some of us have been describing them as blatantly artificial constructs for a while, but trying to create a clean definition for them so you can stop them is clearly proving a little tricky! Still, it gives the Treasury something to do I suppose.

[Bluebird]

I think the problem being now is that they will try and make the net as wide as possible in their description of an MSC so that it catches all one man contracting operations...

[cykophysh39]

I think the problem being now is that they will try and make the net as wide as possible in their description of an MSC so that it catches all one man contracting operations...

OK I get this, but this doesn't stop me from employing my son as a tea boy, as then I wouldn't theoretically be a 1 man contracting business?

[jh0711]

OK I get this, but this doesn't stop me from employing my son as a tea boy, as then I wouldn't theoretically be a 1 man contracting business?

i guess assuming your accounts show some sort of office type of expenses (either a home office or rented office space) that should be fine

if you are going to try and say that you son comes with you to each and every site to make TEA you may struggle.

I suppose you could argue that you employ you son/duaghter/wife/mother etc etc as a coach/mentor/trainer and all work is done via the telephone or web seminars....

probably

[cykophysh39]

Well he is tea boy at the registered office. I don't have to be there for him to make tea.

I suppose he could make virtual tea and email it to me at the clients site?

[Jay54]

Yep, agreed. I have said many times that umbrellas are a fine way to work, provided you don't mind being an employee with no rights and provided you don't mind working to fund some other company's profits. I prefer to keep my work and my profit in house, and I am never going back to being anyone's employee.

Well said that man,band on the nail!

[damo111176]

There are so many arguments each weay you look though surely.

I have just gone from MSC to Brolly, just felt safer and less hassle in all honesty and stopped sleepless nights about having it all in place just to get paid.

I am an IT contractor and with my current contract fail to see how I can justify myself as outside IR35 and if inside the potnetial gain of having my own limited company owuld be negligible maybe £20 a week which when taking tino account the fees I pay (£15 a week) compared to an accountant at around £25 a week plus paperwork I think it ok to continue my own sweet way. I have worked out I will lose £100 a week compared to being in my managed limited company which is quite some drop but the threat of IR35 and paperwork over sending timesheets into an umbrella company has made me run with my tail between my legs and cower under the umbrella.

I agree for most limited companies are the way to go if yuo want to make mojney but considering the amount of poeple that will be dodging IR35 frauduently I don't want to be caught in what will be a hail of bullets if Gordo has his way. He knows people will ruish from managed lmited coimpanies to Personal ones and I expect him to look at them very closely, for the ones who get away with it good luck, for all those genuinely outside IR35 andf reaping the dividends congrats!

People mention insurance of £75 a year against tax investiogation, surely if you fail IR35 then you will have to foot the bill not the ionsurance company and what insurance companies would back you if they thought you failed IR35 hands down, please correct me if I am wrong.

Another reason I went this way was becayuse I have another 7 months of contracting then I don't know.

[Bluebird]

[QUOTE=damo111176]
People mention insurance of £75 a year against tax investiogation, surely if you fail IR35 then you will have to foot the bill not the ionsurance company and what insurance companies would back you if they thought you failed IR35 hands down, please correct me if I am wrong.
[QUOTE]

The insurance is against legal costs, not the actual money you would have to stump up if you are inside when you thought you were outside.

I don't think there are actual penalties, they just make you pay what you should have..