If it seems to good to be true............80%-90% take home

[jbryce]

Wrong on several points. I don't use a Limited to avoid paying tax for one thing; that is a consequence of me operating a business and the taxation framework HMG put in place for limited companies. And you're not avoiding tax, you're only avoiding NICs on a portion of your income; if you work out how much you do pay in CT, generated VAT and PAYE/NICs as a total every year, it's not a good model of an avoidance scheme.

And "unacceptable avoidance" is a long way from using a limited company, and is perhaps best defined as using something that means that after fees you aren't paying any tax at all, or a perhaps a vanishingly small percentage of tax, on your gross earnings. It's not hard to work out why that's a bad idea.

And the SLC is an urban myth in that context. They were penalised for allowing senior staff who legally had to be paid under PAYE as a controlling person to go off payroll, and even getting permission from the Treasury to do so. How that equates to avoidance by the worker I cannot actually figure out.

I, unbelievably, find myself agreeing with you - especially on the 'controlling person' issue- which after a root around was the main point there. So I withdraw that point, probably the rest too.

We do get an advantage as an Ltd; however I find my own work, manage sickness, pensions and, of course, yearly appraisals etc. I run a small company. I like it. It benefits all concerned. I do get an advantage from it - but it's transparent in a way that 'schemes' are not.

I still find it a tad baffling that HMRC and HMG are taking a more aggressive stance towards Ltd company contractors - it seems self defeating.

[LisaContractorUmbrella]

I bet she complains about those fiddly little 5p pieces as well not like the old shilling bit now that was a proper coin mind you it's not like it was back then anyway and you never had to lock your door although of course there was a war on so you couldn't be too careful.

It was groats in my day young man and we never had to lock the door..although we did have to raise the drawbridge in case of marauding hordes

[LisaContractorUmbrella]

I, unbelievably, find myself agreeing with you - especially on the 'controlling person' issue- which after a root around was the main point there. So I withdraw that point, probably the rest too.

We do get an advantage as an Ltd; however I find my own work, manage sickness, pensions and, of course, yearly appraisals etc. I run a small company. I like it. It benefits all concerned. I do get an advantage from it - but it's transparent in a way that 'schemes' are not.

I still find it a tad baffling that HMRC and HMG are taking a more aggressive stance towards Ltd company contractors - it seems self defeating.

HMRC would argue that there is a difference between someone who is business on their own account and someone who is a disguised employee - it's the basic premise of IR35

[Old Greg]

It was groats in my day young man and we never had to lock the door..although we did have to raise the drawbridge in case of marauding hordes

She's mumbling while she's having her nap again.

[smalldog]

I, unbelievably, find myself agreeing with you - especially on the 'controlling person' issue- which after a root around was the main point there. So I withdraw that point, probably the rest too.

We do get an advantage as an Ltd; however I find my own work, manage sickness, pensions and, of course, yearly appraisals etc. I run a small company. I like it. It benefits all concerned. I do get an advantage from it - but it's transparent in a way that 'schemes' are not.

I still find it a tad baffling that HMRC and HMG are taking a more aggressive stance towards Ltd company contractors - it seems self defeating.

If anyone genuinely believes they are in business on their own account with an ltd. Then ask hmrc to review and see if you fall in or out of ir35. If you do fall outside then all the best and good luck with the business. But I would imagine most wouldn't be so bold as they would fall foul and there would be an additional tax liability due, meaning tax had been avoided. Simples.......

[BlueSharp]

If anyone genuinely believes they are in business on their own account with an ltd. Then ask hmrc to review and see if you fall in or out of ir35. If you do fall outside then all the best and good luck with the business. But I would imagine most wouldn't be so bold as they would fall foul and there would be an additional tax liability due, meaning tax had been avoided. Simples.......

But that's not how any business operates large or small, they operate on a basis of risk assessment and mitigation, they don't go around asking people if they would like to be paid more. My company pays for an independent specialist to review its working arrangements and insurance for defense if its needed. HMRC does not decide on the tax statues that done at a tribunal by a Judge. I would be more inclined to ask an independent judge than someone who has a vested interest rubbishing real businesses to drive up it's own revenues.

If HMRC did not like the Ltd setup then any PSC would be in IR35 regardless of working practices not just hidden permies.

[smalldog]

But that's not how any business operates large or small, they operate on a basis of risk assessment and mitigation, they don't go around asking people if they would like to be paid more. My company pays for an independent specialist to review its working arrangements and insurance for defense if its needed. HMRC does not decide on the tax statues that done at a tribunal by a Judge. I would be more inclined to ask an independent judge than someone who has a vested interest rubbishing real businesses to drive up it's own revenues.

If HMRC did not like the Ltd setup then any PSC would be in IR35 regardless of working practices not just hidden permies.

That's a nice idea, but now hmrc have follower notices and accelerated payment powers for open enquiries hmrc have been handed the power of becoming the judge, initially at least.

The govt are arming hmrc with near judicial powers.

[malvolio]

That's a nice idea, but now hmrc have follower notices and accelerated payment powers for open enquiries hmrc have been handed the power of becoming the judge, initially at least.

The govt are arming hmrc with near judicial powers.

But only in specific cases. IR35 is not one such. Any attempt to make it one will be robustly challenged.

Lets not confuse "aggressive avoidance" with "normal business practice". The target of the new powers is clear: one way to mutate them to the wider case is to start thinking they might apply. MyCo is a legitimate UK Limited Company and behaves as one in all respects: that's 95% of its defence against HMRC.

[LisaContractorUmbrella]

That's a nice idea, but now hmrc have follower notices and accelerated payment powers for open enquiries hmrc have been handed the power of becoming the judge, initially at least.

The govt are arming hmrc with near judicial powers.

HMRC have no intention of using their additional powers under the Agencies Legislation to go after PSC's

[Old Greg]

But only in specific cases. IR35 is not one such. Any attempt to make it one will be robustly challenged.

Lets not confuse "aggressive avoidance" with "normal business practice". The target of the new powers is clear: one way to mutate them to the wider case is to start thinking they might apply. MyCo is a legitimate UK Limited Company and behaves as one in all respects: that's 95% of its defence against HMRC.

Unfortunately we are seeing dodgy scheme users spreading this story. it seems to be part of a narrative that they are in the firing line of the new fascist state and we'll be next.

As Mal says, the Ltd company is a perfectly legitimate vehicle defined by primary legislation etc. etc.