How long before changing from PAYE to Limited??

[bash]

Hi guys.

I searched for the aforementioned subject on the site but to no avail.

I have been contracting for approximately one year now as a PAYE. Can you someone please tell me when would be a good time to start out as a limited company??? I have heard through the grapevine that i should have become a limited company by now. Is this true???

Also does anyone know where i can find a calculator which could calculate my earnings as a PAYE please? I may have been paying too much tax??

Thanks in advance.

[scooby]

Hi guys.

I searched for the aforementioned subject on the site but to no avail.

I have been contracting for approximately one year now as a PAYE. Can you someone please tell me when would be a good time to start out as a limited company??? I have heard through the grapevine that i should have become a limited company by now. Is this true???

Also does anyone know where i can find a calculator which could calculate my earnings as a PAYE please? I may have been paying too much tax??

Thanks in advance.

do it when you feel ready... check with agent that they will allow the change mid contract.

[max]

Hi guys.
I have been contracting for approximately one year now as a PAYE. Can you someone please tell me when would be a good time to start out as a limited company??? I have heard through the grapevine that i should have become a limited company by now. Is this true???

There is no requirment to move to ltd co. If PAYE works for you, stick with it.

I think you misunderstand the "Grapevine", or the "Grapevine" has been on the wine.

[Alan @ BroomeAffinity]

If you are direct to client on PAYE then changing to Ltd Co and continuing the same job may not be advisable.

[Danbro]

Danbro Accounting Ltd

If you are direct to client on PAYE then changing to Ltd Co and continuing the same job may not be advisable.

Hi All,

I agree completely with just1morethen, the Inland Revenue would love to see this, this is exactly who the Inland Revenue originally set out to to catch, in their words they are looking for people who leave work on Friday as an employee and on Monday return to the same job as a Limited Company contractor.

However, if the job is significatly different and the contract had the 3 clauses ( substitution, rights of substitution, mutuality of obligation ) obviously the commercial reality of your work.

Thanks

Neil Ormesher
www.danbro.co.uk

[bash]

Hi guys.

Thanks for some informative feedback.

just1morethen and Danbro. Are you guys saying that i cannot move from a PAYE to a limited company???? Is it illegal? I'm sorry, but i did not understand your replies.

The reason i posed this question is that i have heard that financially it would be better for me to "eventually" become a limited company so as to increase my take home pay??? I was under the impression that if you have a long contract then it would better trading as a limited company? Is this correct??

By the way my contract is up for renewal now so possibly this could be the time to switch to limited status if legally allowed???

Thanks to all again.

[Danbro]

Danbro Accounting Ltd

Hi guys.

Thanks for some informative feedback.

just1morethen and Danbro. Are you guys saying that i cannot move from a PAYE to a limited company???? Is it illegal? I'm sorry, but i did not understand your replies.

The reason i posed this question is that i have heard that financially it would be better for me to "eventually" become a limited company so as to increase my take home pay??? I was under the impression that if you have a long contract then it would better trading as a limited company? Is this correct??

Thanks to all again.

Hi,

Its certainly not illegal, we are just saying that if you got investigated the Inland Revenue ( sorry HMRC ) would have a better case to fight with this information. If your contract was strong with the 3 clauses in there or at least 1 of the control or substitution and this reflected the true status of your job then my advice would be that your contract should fall outside IR35 but warn you about how HMRC would have a stronger case.

Even if you was IR35 it is still beenficial to run through a Limited Company, you will basically pay PAYE on a deemed salary but you would be able to claim 5% allowance for general expenses and travel & subs subject to the 24 month rule.

The only positive on a longer contract is that a it would be a large cost to open a Limited Company for a few months really, if its better financially its doesnt matter if you have a company for a year or 3+

Thanks

Neil

[NotAllThere]

Hi guys.

I searched for the aforementioned subject on the site but to no avail.

I have been contracting for approximately one year now as a PAYE. Can you someone please tell me when would be a good time to start out as a limited company??? I have heard through the grapevine that i should have become a limited company by now. Is this true???

Also does anyone know where i can find a calculator which could calculate my earnings as a PAYE please? I may have been paying too much tax??

Thanks in advance.

Are you working through the client or agents payroll, or are you using an umbrella company. For what it's worth, the best time to start out as a limited company is at the beginning of your contracting career.