Reply to: IR591 question

Re: IR591

Budget is early this year - 17 March 2004, so we will know it all in a few more weeks, my gut feeling that its going to have immediate effect.

Re: IR591

> Worded as it is at the moment

pray tell us all where this wording is - I was under the impression that it is not yet formalised and the only "wording" is a load of speculation.

On the flat rate VAT front you being an umbrella sort of person won't gain a red cent becaase you are not registered for VAT. On the other hand as I run a Ltd., am registered for VAT, and have signed up for flat rate scheme wef Jan 1 (still waiting acceptance from the VAT man though) stand to gain about £800 a year by my calculations.

Brolly = employee = wage slave = no bunce from our enterprise loving chancellor. I've been banging on about the advantages of Ltd. over brolly for ages - how much money must the brolly brigade waste before realising they could do a lot better. Keep on filing your dodgy expenses and waiting for Hector to come knocking.

IR591

Worded as it is at the moment, IR591 will significantly increase my take home pay. Of course, you're right, the IR could spring something nasty and unexpected on us, but I don't think so with Blair's electoral position dipping.

There's so much misinformation everywhere.

Also, why is there no thread about the new flat rate for VAT. If you invoice £5,000 a month, you WILL make about £75. So with IR591 and the new VAT rate (now), from April we'll be sinigng again.

Re: Eh?

sgrollitt - are you sure that IR591 would be good if it replaces IR35 ? Just because IR35 is bad, doesn't mean they're unable to dream up something much, much worse. The good thing about IR35 is that most small businesses, and even most contractors, are able to escape it. Those that have fought it have won in overwhelming numbers (I forget the exact figures but it's something like 400 won to 1 lost). I fear greatly that IR591, whatever form it takes, will catch us all in the net and will squeeze us all not only harder than IR35 does, but harder than the owner managers of bigger companies (like for example EDS ?).

Re: Eh?

Are you on the Atkins diet.

I've heard that you get bad breath, but to be able to catch fish ....

But seriously, I think the view is that noboddy actually knows so well just wait.

Eh?

I can't believe there's not more discussion/chat/tittle tattle about IR591.

If it's to replace IR35, then it's very significant in a good way.

If it's to work alongside IR35, then it's very significant in a bad way.

Are we all waiting with baited breath?

I'm very excited and have been catching tench all week my breath is so baited.

Re: Close company - does this help ?

Oh. All right then.

How about Linear B?

Re: Close company - does this help ?

Hi, zeitghost - I think the gist of it is that there's virtually no difference in tax treatment of a simple company whether or not it's a close company. The complications seem to come in when you have the same bunch of people running several companies.

One important thing though - you can't escape being a close company just by registering as a plc - the Ltd / plc status is irrelevant. You can escape it by listing on a stock exchange and having more than 15% of your shares owned by Joe Public. But that costs. And before you think ahah! I can set up my own stock exchange and quote my company there ! - it has to be what they call a 'recognised' stock exchange.

Re: Close company - does this help ?

Well, that might as well be written in Sanskrit for all the information it imparts.

Re: Close company - does this help ?

www.taxarticles.co.uk/clo...anies.html

Re: Close company

I think you mean the other way around? A PLC (for example) has specific dates that it has to hit for accounts and different audit requirements. As a result a director of that type of company has some different responsibilities. An accountant will give you the best advice.

Re: Close company

What are the fundamental implication of being director of a close company? I guess there will be higher scrutiny of the tax affairs? But other than that are there any restrictions that apply to close company but do not apply to non-close company?

Close company

The Inland Revenue's definition of a close company is here:-

www.inlandrevenue.gov.uk/...tapt11.htm

It makes no mention of whether the company is private (Ltd) or public (plc)

However, the IR5.91 statement said nothing about close companies. It was about "owner managers of small incorporated businesses". Anything beyond what has been publicly stated is pure supposition. I think there are actually quite a few reasons to think that the new measures won't rely on the close company definition - because this would create a whole new set of anomalies. More likely, it seems to me, that it would be more like a super-IR35, deeming market-rate salaries for all 'caught' owner-managers and imposing tax and NIC just like IR35 does. An administrative and legal nightmare - just what the R enjoy.

But that's just my own feeling, based on no evidence at all, because there isn't any. Unless of course ContractorUK can come clean on the identity and reliability of their 'source close to the Treasury' and what that source actually said.

PLC/Close company

Simon,

Are you categorically stating that a PLC cannot (currently) be a close company ?

Re: ....

Really glad I don't have a contract at moment. I did when IR35 came out in a place with lots of other contractors. We talked about IR35 all morning, ways round it, what if you did this?, what if you did that? We talked about at coffe break, we talked about it at lunch we..... aaaagh!!!