Considering going Ltd early

[Joe90]

Hi,

I've been contracting for a couple of months since leaving university so as you might expect got my job through an agency and have been working under an umbrella.
Recently my brolly has sent me an email about going Ltd through their sister accountancy firm which got me thinking about how much I might be able to benefit from it.

I looked into accountancy firms and demo'd some software which looked like it might work out well. The trouble now is that they've been in touch & requested some figures to help me by calculating the projected costs involved with going Ltd with them as my accountant. My issue is I'm really new to all this, get paid a basic hourly rate similar to the simplicity you might see on a permie, and I could do with figuring out what my day rate etc would be whilst sticking to my current hour wage.

Any tips guys? Had a look around here & googled a few things but not managed to find much.

[moorfield]

Any tips guys? Had a look around here & googled a few things but not managed to find much.

Hello Joe90.

If contracting is likely to be your thing for the next few years then setup your own ltdco and go it alone.

If you're prepared to spend several hours searching through this forum you will eventually find answers to all your questions...

Good luck with it.

[Green]

Not sure what your question is. You day rate obviously is hrsxhourly rate e.g. 8 hrs x £50ph = £400. If you wanna compare with a permie salary, its annual permie salary/1000 = hourly contract rate though another thread suggests a figure upto 1700.

I'd be interested to know what are the projected costs of going ltd that you have been quoted.

[Joe90]

Not sure what your question is. You day rate obviously is hrsxhourly rate e.g. 8 hrs x £50ph = £400. If you wanna compare with a permie salary, its annual permie salary/1000 = hourly contract rate though another thread suggests a figure upto 1700.

I'd be interested to know what are the projected costs of going ltd that you have been quoted.

Thanks. Well I was correct with my figures then!

As I'm still only 3 months in to work I've not changed my rates yet, still on the basic hourly rate I was offered for the first contract, which when put through this calculator equates to pretty low figures! My current contract is on a longer, more complex job than I started, so I should address a rate change when its up for renewal in November. Anyway, thats besides the point although something I'll have to do some more research in to!

The figures that I was given from the accountant (Crunch) had an annual fee of £714 with a weekly take home pay of £405. However I was put off by the final figures which aren't to clear;
Annual salary per director - 1,000 Director's Salary
Annual salary per director - 5,715 Crunch Salary

Now I understand that when you work as a Ltd, you tend to pay yourself a low salary, and then receive dividends, but it looks as though I wont be able to make that viable for some time!