New contractor - advice on the specifics of setting my limited company up

[Adamra]

Hi all

I am new to the forum and also will be, in the coming months, starting my consultancy role.

I have been in full time employment for some time now. Having made the decision to venture into contracting, i am in the process of looking for a good accountant and also some pointers on how to best set up my limited company.

I will be either adding my mrs as an employee or share holder...i was wondering which of these two is more beneficial to me in terms of obtaining the maximum out of my company?

Any other advice is appreciated, and i am sure i will follow up with some more questions.

With many thanks
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[TykeMerc]

Since you've already said you're going to get an accountant, there are many good ones who post on here, they can and will advise you.
The accountant can also set up your MyCo Ltd for you including shares and how best to treat your spouse with any existing earnings.

The best advice I can give you is listen to your accountant.

[malvolio]

What he said. There are many guides around, the ones on here, the excellent one on the IPSE website (www.ipse.co.uk) and several of the accountant s' websites that post on here. There's also a long sticky talking about which accountants to use. Time to start reading perhaps...

One thing to remember: "please tell me everything I don't know" is a difficult one to answer. Do some research then ask focused questions, then you get good answers.

[PerfectStorm]

I think it's only useful to add your wife as a company secretary or co-director IF they don't do anything else with their time. As otherwise there's no personal allowance to make use of.

[malvolio]

I think it's only useful to add your wife as a company secretary or co-director IF they don't do anything else with their time. As otherwise there's no personal allowance to make use of.

Which is why your simple question isn't simple. Several variables at work here that we won't know and some legislation that should be straightforward but needs to be followed properly

And be clear that as an employee they should be paid in line with their effort. It's only MPs that can pay their wives £35k for two hours a week diary management...

[TheCyclingProgrammer]

I think it's only useful to add your wife as a company secretary or co-director IF they don't do anything else with their time. As otherwise there's no personal allowance to make use of.

In either case (paying them a small salary for actual work, or giving them shares and dividends) it's only worh doing if they have some basic rate band to make use of.

However, if you make your spouse a shareholder, it's well worth making them a company officer too, director or company secretary, so they are eligible for ER if you ever liquidate the company and take a capital distribution. You don't have to pay them a salary.

OP - if you want your wife to receive a salary, it has to be reasonable and they have to actually be doing something for it. It's only worth doing this if they aren't already using their personal allowance.

If they are already in another job, just making them a shareholder is an option but you should consider the split carefully as you could end up pushing her into the higher rate band.

You should discuss your circumstances with your accountant and let them advise you on the best approach and how to do it properly.

[AMH]

setup your business yourself.
Its easy & cheap to do. Costs £15 https://www.gov.uk/register-a-company-online

No need to pay an accountant (or anyone else) to do that & charge you £100+ or whatever for filling in some paperwork where you have to answer the questions anyway.

[TykeMerc]

setup your business yourself.
Its easy & cheap to do. Costs £15 https://www.gov.uk/register-a-company-online

No need to pay an accountant (or anyone else) to do that & charge you £100+ or whatever for filling in some paperwork where you have to answer the questions anyway.

Plenty of the accountants don't charge for company setup.

[SussexSeagull]

Tip from my own personal experience: Don't form a company on-line after getting back from the pub and give it an overly long name.

[kaiser78]

Tip from my own personal experience: Don't form a company on-line after getting back from the pub and give it an overly long name.

You mean like - I Really Love You And You Are My Best Friend Ltd