Do I need to hire accountant on an ongoing basis for my simple case?

[code46]

Sounds like the OP is not on UK passport and requires a visa/partner requires a visa, in order to secure ILR?

If I were the OP, I would not bother with a "local accountant", but would consult with a UK based Accountant, who specialises in Contractor Accounting, as well as an Immigration Attorney.

If it walks like a duck, looks like a duck and quacks like a duck...

Not UK passport, but UK residence with a work VISA in last years, now got IRL. So "local" in that post means somewhere in the UK,

[northernladuk]

Yes, but it's only saying I don't have to depends on the contracting work income to cover my daily living cost. The client wants to hire me as long as possible, at least for the recent one year or two, but I don't want to work full time/year for them at least. That's the reason why they have to hire me as contractor, because it's difficult for them to hire permanent employee with that flexibility.

Maybe but you have to be careful. If all they want is the flexibility but everything else is as it would be for a permie then you will fall inside IR35 which will change things considerably. It's a horribly grey area but if the client wants a perm with flexibility you are going to have to be careful.

Another reason in favour of an Umbrella so you don't have to worry about it.

[code46]

What investment is your partner going to be making in setting up the company? Your initial outlay, as a guess is going to be a maximum of £5k. If they own half the company, they would be expected to put up £2.5k. And in return for this "investment", you are going to give away 50% of the company.

Does the actual number matters? I had colleague set up his own company with one single share cost one pound. Can I just set up a company with 100 shares each worth 1 pounds and me and my partner pay 50 pounds each? My understanding is the share price than grows/declines in proportional to the company's actual worth, doesn't it?

So, you are giving away a significant percentage of your future earnings to someone for a very limited investment. There is nothing to stop you doing that - you could give / sell that kind of stake to anyone you want to - find someone random to sell it to and you're fine. The problem comes from the perception that the income that they derive from that share can return to you, which means that you may have avoided paying tax on what would have been due if you had remained 100% owner of the business. It becomes difficult to prove that you haven't received any benefit from the money (particularly if you have a joint bank account).

Thanks for reminding me of this. So there is no regulation to forbid you actually start up a business together with your wife/partner given if you are indeed setup the business and run it together and has indeed equal share of responsibility and functionality in the business and your expenditures separate ? I understand it's difficult to justify in the case of contractor I guess, just want to know whether my understanding is correct?

Two more things to consider. Firstly, as NLUK says, at the level you are talking about, is there any financial benefit in having a split ownership? Secondly, what happens if you separate - she now has half the company and rights to half the dividends that you declare from now on.

Thanks. Well, my partner is in fact my spouse, just not in the legal term. We've been together since 13, longer than the marriage of many couples. When she came with me to live in France and now UK, her VISA was always "defendant" as unmarried partner. One must provide stronger evidence to the immigration office to support this case, but it's not a problem for us, because we are in fact spouses just without registration.

[northernladuk]

Thanks. Well, my partner is in fact my spouse, just not in the legal term. We've been together since 13, longer than the marriage of many couples. When she came with me to live in France and now UK, her VISA was always "defendant" as unmarried partner. One must provide stronger evidence to the immigration office to support this case, but it's not a problem for us, because we are in fact spouses just without registration.

No she isn't. For legal purposes you have to be married or civil partnership. It doesn't matter what you consider it as.

Listen... nearly every response you have given has ended with a question. This is exactly why you need an accountant. Enough asking questions from people who don't know your situation and to be honest don't really care. Go get some professional advice. Speak to the Umbrellas and ring a couple of the accountants that post here and ask them. You are just getting yourself confused and getting no where here.

[eek]

You could make regular winnings gambling as much as you like, it still won't be taxable. Gambling as a trade is only taxable if you are facilitating it (eg running a casino or bookmakers) or making money from other services related to it (eg pro poker player earning a TV appearance fee).

Gambling itself does not constitute a taxable trade.

Caveat: there might be some things that HMRC do not consider to be gambling even though they appear to be.

That is so incorrect in so many ways I don't know where to begin..... but as a hint I don't pay unexpected tax bills willingly...... However as its an aside to my argument that the OP does need professional advice I will leave it at that.

2 people say that gamblers don't need to pay tax on profits, one tax bill from the mid 0's says something very different.....

[northernladuk]

That is so incorrect in so many ways I don't know where to begin..... but as a hint I don't pay unexpected tax bills willingly...... However as its an aside to my argument that the OP does not professional advice I will leave it at that.

2 people say that gamblers don't need to pay tax on profits, one tax bill from the mid 0's says something very different.....

HMRC see seem to be pretty clear. What isn't clear is what the OP means about gambling. Tax on winnings from betting isn't taxable. If it is connected to his trade then it is.

BIM22017 - Meaning of trade: exceptions and alternatives: betting and gambling - the professional gambler

BIM22015 - Meaning of trade: exceptions and alternatives: betting and gambling - introduction

BIM22019 - Meaning of trade: exceptions and alternatives: betting and gambling - element of existing trade

As ever it is down to the details. Gambling winnings are not taxable is both right and wrong. More detail is required to answer.

[code46]

Maybe but you have to be careful. If all they want is the flexibility but everything else is as it would be for a permie then you will fall inside IR35 which will change things considerably. It's a horribly grey area but if the client wants a perm with flexibility you are going to have to be careful.

Another reason in favour of an Umbrella so you don't have to worry about it.

True, would consider contracting with other companies in the future, but granted this is something to watch out.

Yeah, might go with umbrella eventually, but it's fascinating topic to discuss. So using an umbrella company, I'm basically just employed by the umbrella company and pay even higher tax than normal permanent employees do (due to employer NI contribution and margin)? Dame, in that case I'd seriously consider to reduce my working hours and give self more free time instead. Is there anything I can choose/control regarding payment/tax, or nothing at all?

[northernladuk]

True, would consider contracting with other companies in the future, but granted this is something to watch out.

Yeah, might go with umbrella eventually, but it's fascinating topic to discuss. So using an umbrella company, I'm basically just employed by the umbrella company and pay even higher tax than normal permanent employees do (due to employer NI contribution and margin)? Dame, in that case I'd seriously consider to reduce my working hours and give self more free time instead. Is there anything I can choose/control regarding payment/tax, or nothing at all?

Ask your accountant.

[code46]

HMRC see seem to be pretty clear. What isn't clear is what the OP means about gambling. Tax on winnings from betting isn't taxable. If it is connected to his trade then it is.

BIM22017 - Meaning of trade: exceptions and alternatives: betting and gambling - the professional gambler

BIM22015 - Meaning of trade: exceptions and alternatives: betting and gambling - introduction

BIM22019 - Meaning of trade: exceptions and alternatives: betting and gambling - element of existing trade

As ever it is down to the details. Gambling winnings are not taxable is both right and wrong. More detail is required to answer.

I'm doing spread betting. BIM22015, among others, is about it.

The same topics been discussed on forum like trade2win repeatedly, which arguably means there is still different interpenetration of the actual wording, but most people believe it's tax free (unless your trade is not gambling itself but selling service related to gambling). Several people wrote to HMRC and got positive answers in written, then framed the papers and hang them on the wall at home

[northernladuk]

I'm doing spread betting. BIM22015, among others, is about it.

The same topics been discussed on forum like trade2win repeatedly, which arguably means there is still different interpenetration of the actual wording, but most people believe it's tax free (unless your trade is not gambling itself but selling service related to gambling). Several people wrote to HMRC and got positive answers in written, then framed the papers and hang them on the wall at home

But it also has exceptions..

BIM22020 - Meaning of trade: exceptions and alternatives: betting and gambling - spread betting

So the devil is in the details and YET ANOTHER reason you need to get an accountant. The message couldn't be clearer.