Petition to get the gov to reconsider the dividend tax changes

[d000hg]

You can write "President and CEO" on your YourCo business card, it doesn't change the facts.

A Ltd is NOT the most sensible structure for a contractor, we use them because it's the most efficient way of working not because we want to start up a business. Contractors decide "I want to go contracting" not "I want to run a business".

[DimPrawn]

Paying both sides of NI doesn't really make sense either. We may legally be a company with one person but most of us aren't necessarily employees of our companies anyway and the fact is, a Ltd is just a convenience/necessity for contractors. A special 1-ban-band/PSC setup could make sense, since/provided one could transition to a regular Ltd easily if you end up being more of a 'proper' business. Or some sort of protection for sole traders so that agencies/clients are not scared of using them.

Straight out of the New Lie wankiness of business handbook.

No, how about feck off, I run a proper legal limited liability company in the same way as anyone else. It is not a PSC or other such meaningless bulltulip. It is a VAT registered, tax paying business, that takes risk, performs services, submits invoices, hopes for payment, sends in the legals for non payment, just like every other business.

Go **** yourself with your bulltulip.

HTH BIDI

[d000hg]

Paying both sides of NI doesn't really make sense either. We may legally be a company with one person but most of us aren't necessarily employees of our companies anyway and the fact is, a Ltd is just a convenience/necessity for contractors. A special 1-ban-band/PSC setup could make sense, since/provided one could transition to a regular Ltd easily if you end up being more of a 'proper' business. Or some sort of protection for sole traders so that agencies/clients are not scared of using them.

[LondonManc]

nluk's implication was that it didn't matter because it wouldn't affect his lifestyle (i.e. not based on fair/unfair)

No it wasn't, that's your interpretation. It's a minor issue compared to the other two factors - the expenses issue limits many people geographically (in terms of what is financially viable) and the agency/IR35 issue hits everyone massively. Given most contractors are advised to pay minimal wages and take the rest as dividends, paying more dividend tax is far less restricting of his contracting lifestyle.

[VectraMan]

(I'm only playing devils advocate, I think we should all pay PAYE but no employers NI, which I think the div tax will align to in the near future)

Why no employer's NI? That makes no sense.

If you're genuinely in business you should be free to act like a business which just happens to have one employee. Which means the employee pays the full amount of tax on what they actually earn, and the business is free to keep profits in the company to smooth out any future peaks and troughs. The worse thing about IR35 is that it taxes you on the company's income for that year whether you've personally earned it or not. They should sort that out, get rid of the reporting requirements of one man companies (and so saving us all money spent on accountants), and apply the expenses rules in a way that treats permies and contractors equally, and I'd think that would be fair to all.

[pr1]

You could say the same about income tax or personal allowance. Rejecting something that's fair because it might end up being unfair doesn't seem that sensible. At this rate, by the time they do what you suggest we'll all be in IR35 anyway.

nluk's implication was that it didn't matter because it wouldn't affect his lifestyle (i.e. not based on fair/unfair)

[d000hg]

maybe at 7.5%, what about at 10%? 12.5%? 15%? What about if the 5k free limit reduces to zero?

You could say the same about income tax or personal allowance. Rejecting something that's fair because it might end up being unfair doesn't seem that sensible. At this rate, by the time they do what you suggest we'll all be in IR35 anyway.

[VectraMan]

I can't remember 100%, but pretty sure the box was whether the company was PSC.

For me the answer was no.

I did my SA the other day and it simply asked if any income was derived from a Personal Service Company. As a permie for that year then I could truthfully say no, but in the past as a contractor I might have said yes.

[pr1]

Absolutely this. I can't remember too much that hasn't gone our way in recent budgets. Many other groups have been hit year on year. Something was going to happen eventually. Yes it narks me but isn't going to affect my lifeatyle. The other issues however.....

maybe at 7.5%, what about at 10%? 12.5%? 15%? What about if the 5k free limit reduces to zero?

it's not going to happen, but the time to challenge it is now, not when it's been introduced and they start creeping it up 1 or 2% per year

(I'm only playing devils advocate, I think we should all pay PAYE but no employers NI, which I think the div tax will align to in the near future)

edit: I'm also not signing the petition

[AtW]

I avoided checking the box because it went on to say something about "and operated within IR35".

I can't remember 100%, but pretty sure the box was whether the company was PSC.

For me the answer was no.