New Contractor seeks Urgent Help!

[The Master]

The 5% is a flat rate. You do not have to justify the expense.

[css_jay99]

Cheers,

Ok from what I am understanding,

1) When using a brolly Co.
Bcos they operate PAYE, you never fall foul of the Taxman.
Additionally, if income is caught by IR35 then at least I save on paying Employer NIC (had it passed via my Ltd Company)

2) when Using my Ltd Company
Pass only services that are Definately not caught by IR35. Then pay it as Dividend (after Corp tax )

If it is so simple why dont brolly & accounting companies tell you that, instead of dumping tons of pages of their interpretatuion of IR35 on their sites and telling you lies of how much they can save you !

While I now understand the purpose of IR35, the test to check you are caught by it still seem unjust.

Take for instance, "IR35 might not apply to you if your client does not dictate how to do the job" . If that is the case them A lot of IT contractors will definately be caught by IR35, afterrall most of us developers work from functional specs and designed documents most probably created by the client or other contractors. Also you still have to adhere to their development guidelines.

The other thing (even if in you contract) that you can use a substitute to do the job. I am sure most clients will fire someone if they even sugested it considering, it is you who went for the interview not a substitute !


Any one heared of Carrington accountancy ?


css_jay99

[malvolio]

Sorry,m you need to do a bit more reading yet.

The control test is that they tell you exactly what code to write from the functional spec, how to construct logical loops, where to add comments, what naming conventions to use for variables...If however they say "Write me a functioning program to do this to our quality standards" and leave you to it, you are not caught.

The other two are:

Substitution clause - do you have one that is not so tied down it can never be invoked? You don't have to invoke it, and the client might be able to have a say in how well qualified your proposed sub can be, which is fair, but they cannot have an absolute veto.

Mutuality - if they have no work, they can send you home without pay. If you do no work for them, you don't expect to charge them for it.

There are a couple of other strong pointers, like assymetric notice periods (hint: you don't want a notice period from your side) but if you have any one of the above you can probably assume you're out of IR35 and someone like Accountax will happily defend you (erm, you do have insurance, I take it?)

Hence my constant assertion that IR35 is voluntary. The only people that are caught by it are the terminally lazy or the terminally ill-informed.

[xoggoth]

I do all mine, but only because accountants are such a useless lot. If one existed that was any good that I could just throw a shoebox full of receipts and invoices at I probably wouldn't bother, it's dead boring.

[css_jay99]

the more reading I do the more confused I am.

My current contract is via a permie friend (rather thank an agency) to do a project at his employers's site.

Looking at the contract(btw both of us), he agrees with me that I am not caught by IR35. While I am under a deadline to deliver, I still decide on how I go about development irrespective of the Business requirement documents.


err, i dont have insurance. I guess i have to look into this !

malvolio, i dont understand what U are saying about notice periods. any idea where other than hmrc.gov.uk that I can do more research ?



xoggoth, you said you do your accounts yourself, any pointers you can give?

what software do you use. was thinking of buying Sage instant accounts but I dont like their Sage Instant payroll

[Mustang]

Contract review

Suggest you pay someone like B&C to do a contract review - will take out the worry.

[css_jay99]

Because I have not sorted what I going to do about accontant/bookkeeping I have not paid myself.

So up to date I have been contracting for the last 2 months with my Ltd Co. and my Co. has been paid. because I have not got round to sorting out accountant/PAYE, i have not paid myself.

the question is, Am I in trouble with IR or is there a time limit to which I have to sort all these out. i guess i can also pay my self more money in one month to account for all the months I miss payment.

The second query is, Do I have to alway do PAYE for myself every month ?


cheers !

[The Master]

It's your Ltd so you decide when the staff get paid. If they don't like the fact that you only pay them twice a year (or whatever) I'm sure they will vote with their feet.

The one thing HMRC don't like is not getting the monthly PAYE slip but if you haven't run the payroll just send it with zero on it.

[css_jay99]

The one thing HMRC don't like is not getting the monthly PAYE slip but if you haven't run the payroll just send it with zero on it.

Is this some yellow stuff they send via the post, I have not got round to reading or opening the letter yet.

Can i backdate these payslips fro the last 2 months to give HRMC

Is it Illegal for me not to submit one if I dont pay myself in any month ?


css_jay99

[Lucifer Box]

Is this some yellow stuff they send via the post, I have not got round to reading or opening the letter yet.

Can i backdate these payslips fro the last 2 months to give HRMC

Is it Illegal for me not to submit one if I dont pay myself in any month ?


css_jay99

That's the johnny. They don't care what's on it as long as you send it in every month. If you leave it much longer you will probably get a letter or phone call asking you why you aren't returning them (I did). As I said, if you haven't run the payroll or paid yourself, still send it back, just do as the Master suggested and put zero on it.

Your only legal obligation is to pay the PAYE for the year by 19th April, but don't rock the boat, just send the slip in every month. Make a recurring appointment in Outlook to do it every 13th (say).