Accountants and Insurance

[malvolio]

My understanding from discussion with my accountant is that there are two possible scenarios:

1) The company pays a lower rate (e.g. 10p) per mile for the use of the car, and the company pays for all expenses relating to the running of the car (e.g. insurance, servicing, new tyres, magic trees etc)

2) The company pays a higher rate (e.g. 40p) per mile for the use of the car, but may not pay for any other expenses relating to the car as described above.

The usual warnings apply about myself not being an accountant and this not being solid advice. Speak to your own accountant to get the full picture.

You get 40p a mile, reducing to 25p after roughly one yer's average mileage (I know...) to pay for the purchase of the car, depreciation, lost interest and operating costs. If you want to spend it on other things, fine, but you can't then expect to claim it back again. It also keeps you out of BIK-land if challenged.

So take the obvious option.

[cartlidgea]

Thanks guys. I think I have been wasting my time. My contract is 7 months long if I go umbrella I lose 2.2K so straight away I thought I should go limited. But now after working out that my IR35 cover, PI, PL and EL insurance along with my accountant will come to 2K for the year (as my accountant wants full payment even though I will only use him for 7 months) (PI,EL,PL £317+vat) + (Qdos full cover £325+£35+Vat) + £1300 + vat accountant it seems either way I am stuffed. Before I wasnt taking into account the VAT so it was worth it now I realise it is not. As I was going to use the flat rate tax scheme I cannot claim the VAT back either so it makes way too expensive and not worth the small gains for all the extra work. I want a cheaper accountant but if I go with a big name like you suggest I run the risk of being dragged down as an msc.

[Sockpuppet]

My understanding from discussion with my accountant is that there are two possible scenarios:

1) The company pays a lower rate (e.g. 10p) per mile for the use of the car, and the company pays for all expenses relating to the running of the car (e.g. insurance, servicing, new tyres, magic trees etc)

2) The company pays a higher rate (e.g. 40p) per mile for the use of the car, but may not pay for any other expenses relating to the car as described above.

The usual warnings apply about myself not being an accountant and this not being solid advice. Speak to your own accountant to get the full picture.

Not accurate.

If you did 1 then the company would have to own the car on which you'd pay BIK on it. Or if you paid for the balancing etc then you'd pay BIK on that.

[oraclesmith]

Thanks guys. I think I have been wasting my time. My contract is 7 months long if I go umbrella I lose 2.2K so straight away I thought I should go limited. But now after working out that my IR35 cover, PI, PL and EL insurance along with my accountant will come to 2K for the year (as my accountant wants full payment even though I will only use him for 7 months) (PI,EL,PL £317+vat) + (Qdos full cover £325+£35+Vat) + £1300 + vat accountant it seems either way I am stuffed. Before I wasnt taking into account the VAT so it was worth it now I realise it is not. As I was going to use the flat rate tax scheme I cannot claim the VAT back either so it makes way too expensive and not worth the small gains for all the extra work. I want a cheaper accountant but if I go with a big name like you suggest I run the risk of being dragged down as an msc.

Don't be such a penny-pincher. You either want to run your own company or your don't. If the only reason you want to go limited is because it's a couple of quid cheaper than being an umbrella employee then good luck to you when HMRC come calling...

[cartlidgea]

Don't be such a penny-pincher. You either want to run your own company or your don't. If the only reason you want to go limited is because it's a couple of quid cheaper than being an umbrella employee then good luck to you when HMRC come calling...

Oh mate this is so un true whenever I look at what drives people on this site to advise whether to go limited or umbrella they always state as the first thing the percentage increase of salary take home from working as a limited company rather then umbrella.....we are all in it for the money