Limited Company, Personal account and Agency

[kal]

Hi all, after some advice.

Had a limited company for over a year but not used it until this new contract which started in Jan. Will be doing my own accounts at the end of the year and not credit worthy for a business account.

I have been using my personal account for payment of invoices which my bank has been accepting. I have no issues with HMRC going through my personal account and keep receipts for all business expenses which are minimal and fall under IR35.

On Friday I had a monthly payment go in but my bank refused it and have sent it back to the agency same day payment after a discussion with them. I was in London at the time some 100 miles from home and had no money to get back expecting this to clear Friday morning as normal monthly pay.

I spoke to my agency who due to my situation advanced me £150 and said we will deal with it on Monday (payment hadn't cleared back at that time).

They say that I am not supposed to use my personal account and that I should have a business account, I informed them that this is not illegal even though me and the limited company are separate legal entities.

I have no money at present now as I had to use the £150 and have other financial personal commitments that were meant to be paid on Friday. My concern now is how do I get paid tomorrow? I need to be paid as have just managed to last 5 weeks since my last payment and really in the schtum.

Could I get it paid into a friends business account? Would that cause issues and they forward it to me? Could I get them to send the payment again with the payee having my name and company name in the same line? "A. Another / contractor Ltd"

I know some people frown on using personal accounts but I am happy doing it this way. Not sure what to do going forward but at least I have 4 weeks to sort before the next payment

If you are caught by IR35 and considering your financial situation why did you not just use an umbrella, would have
been so much simpler re accounts and you wouldn't need a business bank account.

[cojak]

Yes I understand that now. What do I need to do to get my payment tomorrow from the Agency is my main concern at present. I have budgeted my last weekly payment 6 weeks ago to last the last 5 weeks and am going to have difficulties getting to work, rent everything. I just need to sort tomorrow and then I will either looking at going back to an umbrella most likely.

Speak to an umbrella tomorrow morning. There are a few who post on this forum. Between them an the agency you might get at your money before the end of the week.

[keyser666]

I don't have a clue. I think you have been extremely lucky to find an agent that will pay it in to your personal account to be honest and they won't be doing it again if it causes them this much grief. They must be taking a big cut for this gig to put up with it IMO.

I presume your divi paperwork is all in order etc although not sure how it can be if you have spent your VAT and CT money.

As stated my CT money is safe and I am not VAT registered

[keyser666]

Speak to an umbrella tomorrow morning. There are a few who post on this forum. Between them an the agency you might get at your money before the end of the week.

Yes I probably will go back to an umbrella company, was so much easier, not sure why I didnt bother this time around

[keyser666]

Can anyone answer my earlier question as to whether the Agency will be able to send the payment FP/CHAPS with the payee name "my name/ltd company name?" my bank have not said that they wont receive it but are saying because my name was not on it they are not accepting it.

I know the agency will not want all this next time so will go back to my umbrella company cellbrite

[malvolio]

Can anyone answer my earlier question as to whether the Agency will be able to send the payment FP/CHAPS with the payee name "my name/ltd company name?" my bank have not said that they wont receive it but are saying because my name was not on it they are not accepting it.

I know the agency will not want all this next time so will go back to my umbrella company cellbrite

Becuase banks have different disclosure rules for personal and business accounts to meet different legal requirements. They will see company money in a personal account as potentially illegal. Also they won't let you pay in money off a cheque made out to me, why would you expect them to treat money made out to YourCo be treated any differently? You have already agreed they are a different legal entity to you.

Stick with an umbrella. The real world is clearly too difficult.

[keyser666]

Becuase banks have different disclosure rules for personal and business accounts to meet different legal requirements. They will see company money in a personal account as potentially illegal. Also they won't let you pay in money off a cheque made out to me, why would you expect them to treat money made out to YourCo be treated any differently? You have already agreed they are a different legal entity to you.

Stick with an umbrella. The real world is clearly too difficult.

I will sort out and go back to an umbrella my main concern is this moment. There is no illegality here.

[SueEllen]

I will sort out and go back to an umbrella my main concern is this moment. There is no illegality here.

You are lucky your bank didn't and haven't decided to freeze your personal account.

It's also not a good idea to give your sister your company's corporation tax money. I suppose she doesn't mind her accounts being looked at as well?

You would have been better of paying it directly to HMRC in advance as they will refund you later on if you overpay.

[keyser666]

You are lucky your bank didn't and haven't decided to freeze your personal account.

It's also not a good idea to give your sister your company's corporation tax money. I suppose she doesn't mind her accounts being looked at as well?

You would have been better of paying it directly to HMRC in advance as they will refund you later on if you overpay.

No reason not to give it to my sister. She has it in a account she doesnt use anymore so not an issue. Shame I didnt not know about the advance payment aspect of paying it. Going to go and use an umbrella company now as said as I like to know where I am.

So what are my possible options tomorrow? I need to get paid tomorrow.

[cojak]

Our accountant regulars will be here tomorrow, they'll be able to give to specific advice on this.