Sunday Times seeks case-study: why are you self-employed?

[MarillionFan]

How's the vat thing count as paying more tax? You collect, they reclaim.

I pay more (real) tax in £ than I did as a permie, and take home more too. Sounds like a win/win.

I paid more tax last year than most of you invoiced.

HMRC is like Ched Evans. They know they've raped you but they're not going to admit to it.

[PerfectStorm]

The whole tax avoidance thing is bollocks anyway. I did a blog a while back where I worked out how much tax I generated for HMRC compared to a permie on a comparable salary. With VAT, CT, PAYE and NICs on an average year, I paid a lot more a year than he did...

Edit: Found it...

Assume an individual with a not unreasonable potential income of £75k, either as salary or as net profits from their business. And, for the sake of argument, we’ll assume that none of that money is going to be ploughed back into the business for growth or protection against future gaps in earnings.

An employee would pay roughly 39% in tax and a company owner using the minimum salary and dividends option would pay a mere 26%. Clearly unfair chaps, come on, play the game.

But – and I think it’s quite a big but – look at the actual numbers. Against that income, the employee would pay £29,250 in tax. The company owner, however, would pay £32,625. That’s £33,75 more than the employee does.

Not sure that sounds right to me.

Using current (i.e. end of 2014) figures:

Income of 75K as permanent staff:
Income tax: £19627
National Insurance: £4731
Total taxes paid by employee: 24,358
Optionally you could include Employers NIC: £9252 (2015)

Based on a 235 working day year, a contractor on a day rate of £320 would take £75,000 a year not including VAT
Corporation tax: £11,765
Dividend tax: £4,595
Total tax paid by sole director: £16,360
And that's without lessening this figure via any expenses...

And as the above said, cost of VAT is reclaimed...

[malvolio]

VAT doesn't count. You invoiced it, clientco claimed it. Are you the Starbucks CEO?

Oh FFS... Someone at the bottom of the food chain pays the VAT.

[MarillionFan]

Oh FFS... Someone at the bottom of the food chain pays the VAT.

Are you saying that you're a bottom feeder?

[mudskipper]

I paid more tax last year than most of you invoiced.

Thank you - it's appreciated.

[Batcher]

Oh FFS... Someone at the bottom of the food chain pays the VAT.

It's always been my view that I'm generating VAT for collection. As an unpaid tax collector I don't benefit but HMG would be worse off without it if I was a permie.

[PerfectStorm]

It's always been my view that I'm generating VAT for collection. As an unpaid tax collector I don't benefit but HMG would be worse off without it if I was a permie.

Assuming you're on the flat rate scheme, you are a paid collector.

[d000hg]

Yes but under the pseudonym PsychoCandy

[DodgyAgent]

So, to sum up, has anyone contacted the OP?

Just asking, like.

I got some references out of him