April 5th Changes

**Cowboy Bob** · 15 March 2007, 09:26

Originally posted by gallotta

Any suggestion on how to get around this legally and still get dividends?

Become a real contractor and open up a Limited Company...

**gallotta** · 15 March 2007, 09:29

Originally posted by Cowboy Bob

Become a real contractor and open up a Limited Company...

Thanks Cowboy Bob, that is what I am planning to do. Will this help me with the next payment though?

Cheers

**VectraMan** · 15 March 2007, 09:39

You need to end that contract and start a new contract with your new Ltd. company. I've no idea how happy the likes of Giant are to let you do that (or your agent), but I'd suggest it isn't worth the hassle for that one month. Just take the hit, and get your Ltd. set up now ready for the next contract.

**gallotta** · 15 March 2007, 11:11

Thanks Vectraman,

why do you think I need to start a new contract? Could I just Invoice the agency directly for this month ? Since Giant is not able to provide the same service anymore, i should not think would be a problem.

Cheers

**VectraMan** · 15 March 2007, 11:24

Originally posted by gallotta

why do you think I need to start a new contract? Could I just Invoice the agency directly for this month ? Since Giant is not able to provide the same service anymore, i should not think would be a problem.

The contract is between the agent and Giant. The agent has no deal with your Ltd. for anything, so they're just going to laugh at an invoice.

However, I've just thought of something: This will be the first month of the new tax year, so you can count the money from Giant as the first part of your year's salary. Say you get £5K gross for that month, and you were planning on paying £10K per year salary, well then you just pay £5K over the other 11 months and you're back where you wanted to be. You'll pay too much tax for that month, but get it back a year or so later after doing your self-assesment. Obvious really.

But I am not an accountant (and you should ask one).

**weboo** · 15 March 2007, 11:27

I'm doing the same. Just setup a ltd company with my accountant and have contacted my agency to notify them that I will be changing Ltd company names. The agency have been very welcoming and have to do this for many others

I'll start invoicing from the start of the new tax year as my new company

**boredsenseless** · 15 March 2007, 11:27

Originally posted by VectraMan

The contract is between the agent and Giant. The agent has no deal with your Ltd. for anything, so they're just going to laugh at an invoice.

However, I've just thought of something: This will be the first month of the new tax year, so you can count the money from Giant as the first part of your year's salary. Say you get £5K gross for that month, and you were planning on paying £10K per year salary, well then you just pay £5K over the other 11 months and you're back where you wanted to be. You'll pay too much tax for that month, but get it back a year or so later after doing your self-assesment. Obvious really.

But I am not an accountant (and you should ask one).

Depending on how you structure the limited this may leave you issues regarding minimum wage for the next 11 months though. As said talk to an accountant.

**lukemg** · 15 March 2007, 11:47

With an MSC currently which has worked great for me - contract defo finishes in May. Planning to switch to umbrella after end of tax year. Will reluctantly setup Ltd if I score another contract (they are a pain to run and double-pain when you want to close down).

**mictech** · 15 March 2007, 12:07

Originally posted by lukemg

With an MSC currently which has worked great for me - contract defo finishes in May. Planning to switch to umbrella after end of tax year. Will reluctantly setup Ltd if I score another contract (they are a pain to run and double-pain when you want to close down).

I hope more people have your lazy attitude, so gordo will get his tax cut and stop bothering the contractors who want to run a company in a tax efficent way.

April 5th Changes