Payment for work done last year.

[Normie]

A friend of mine did 3 days work for a client last March. He had just left a permie position and didn't have time (or couldn't be bothered) to set-up with an umbrella for just 3 days work. So with my permission the contract was set-up though my Co. To be honest I'd forgotten all about it until this week when I asked my friend about it - he had overlooked it too. So I've just raised an invoice for the payment to the agency concerned (about £1.5k exc VAT).

Now, assuming payment is made as expected I'm not sure what the best was is to pay what is due to my friend. The lazy side of me says a) just give him a grand in cash from my personal account, the other side says b) do it properly - deduct corp tax, employers NI, employees NI and PAYE.

Would there be any likely comeback from a) or should I play it by the book?

Cheers,

[ASB]

A friend of mine did 3 days work for a client last March. He had just left a permie position and didn't have time (or couldn't be bothered) to set-up with an umbrella for just 3 days work. So with my permission the contract was set-up though my Co. To be honest I'd forgotten all about it until this week when I asked my friend about it - he had overlooked it too. So I've just raised an invoice for the payment to the agency concerned (about £1.5k exc VAT).

Now, assuming payment is made as expected I'm not sure what the best was is to pay what is due to my friend. The lazy side of me says a) just give him a grand in cash from my personal account, the other side says b) do it properly - deduct corp tax, employers NI, employees NI and PAYE.

Would there be any likely comeback from a) or should I play it by the book?

Cheers,

CT?? IKf you are paying him as an employee (which is fine) then this is chagreable against CT thus there is no profit and not CT impact.

Alternatively you could just have him send you an invoice and pay this (this is what I always used to do). There is a small risk here that if he doesn't declare it and the taxman finds out the taxman can theoretically come after you.

[NotAllThere]

Get him to invoice you. You pay the invoice, and he declares it as other income on his tax return.