Employee PAYE vs Employer PAYE

[wilson1973]

Hello to you all and thank you for passing by.

I'm a newbie contractor (all rather exciting stuff), so please bear with me.

I am a sole share holder in a limited company and VAT registered with my bank account setup, so in essence have the basic setup complete.

I am in my first contract and shall shortly recieve first payment for the services undertaken.

I am not setup for PAYE however and not sure whether I need to register as an employer or employee or both?

I cannot see many related threads to this on the forum or in the guides, can someone point me in the right direction or advise the way forward.

Should I setup PAYE half way through the year, bearing in mind I had no prior employment for the first half of the year, and just take a dividend. Or is it only slightly more hassle to setup PAYE mid year and take both a limited salary and dividends ?


Thanks & Regards

Wilson

[Clare@InTouch]

Your company will register as an employer, and then submit a P45 or a P46 in order to add you to it's payroll. It's easy to register for PAYE, there's a simple online form on the HMRC website.

If you've had no employment since April 2011 then it's worth setting up a scheme as you will be able to pay yourself a small salary on which you'll pay no tax or NI, but on which the company will save CT.

If you have an accountant they can do this for you, and advise on salary level.

[northernladuk]

If you have an accountant they can do this for you, and advise on salary level.

This +1. It could be argued part of the basic setup is getting a good accountant. If you are new they could quite easily save you more than they cost in the first few years and keep you on the right side of the law in the worst case.

If you don't have one get one quick IMO.

[wilson1973]

Thank you for your advice.

[Jeremiah@RHJAccountants]

This +1. It could be argued part of the basic setup is getting a good accountant. If you are new they could quite easily save you more than they cost in the first few years and keep you on the right side of the law in the worst case.

If you don't have one get one quick IMO.

I agree with what has been said get a good accountant and they can advise you with any questions you may have on salary and dividends.

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