Reply to: what about partnerships ?

[Mustang]

Just your use of the word "job" is similar to most Swedes!

[2uk]

Are you by any chance Swedish?!

Nope why ? Well i am blonde and gorgeous as a swedish but not.

[Mustang]

distibuted according to how much job each partner has done.

Are you by any chance Swedish?!

[2uk]

There must be a million (IT) contractors who started out with that aspiration.

About three have achieved it.

tim

Any other ideas for growing the biz ? In the end a 1 man limited company is just that - a limited company.

[2uk]

In that case you want a Limited.

In a partnership the partners are what is called: "jointly and severally liable". This means that if one of the partners runs up a huge debt and then buggers off, the other one gets to pay it back.

You really don't want to go down this path with a 'real' company.

tim

yep , yet there is another animal - a Limited partnership ..

[2uk]

I work thru a LLP my status is self employed therefore I can offset all business expenses etc, pay very little NI as only class 2/4 due(1% after £33.000), and as Limited Liability, I am not affected by any other partner.

Agencies OK with this as they pay my payroll provider(a ltd co) and they pay me. I do pay tax / NI etc up front so return a bit less than Ltd. Its a good compromise and much better than PAYE umbrella or inside

Are you using the partnership only as a business model or you are also collaborating/helping with the other parthers ?

As a limited partnership it has everything - registration, VAT , bank accounts .... why do you need to use a separate Ltd to get the payroll from the agents ?

[LA1]

I work thru a LLP my status is self employed therefore I can offset all business expenses etc, pay very little NI as only class 2/4 due(1% after £33.000), and as Limited Liability, I am not affected by any other partner.

Agencies OK with this as they pay my payroll provider(a ltd co) and they pay me. I do pay tax / NI etc up front so return a bit less than Ltd. Its a good compromise and much better than PAYE umbrella or inside

[tim123]

I am just lookin for the best scheme that is not less preferable to clients (compared to a Ltd). However one that is a flexible way for me and other fellow contractors to work under a common company, but so that the reveneue is distibuted according to how much job each partner has done.

In that case you want a Limited.

In a partnership the partners are what is called: "jointly and severally liable". This means that if one of the partners runs up a huge debt and then buggers off, the other one gets to pay it back.

You really don't want to go down this path with a 'real' company.

tim

[tim123]

Once i start contracting and beat the **** out of me of studing/working/managing a company/traveling to work/cleaning the home/loundry/cooking etc , i want to have a Ray of light in the tunnel so that i dont die emotionally.

By growing I mean things like:

-Combining with other contractors
-going .com
-Hiring Employees.

There must be a million (IT) contractors who started out with that aspiration.

About three have achieved it.

tim

[malvolio]

Well , TimeSheets can be mandatory , and the payment can be based on the time worked on. I'd love to start smth. like that , any fellas ?


"Collaboration of separate companies" - Do you basically refer to friendship that form between contractors - as they help each other find work ?

Are you referring to http://www.innovos.co.uk/ ? The site seems down. That's exactly what i had in mind, looks they are already doing it. Is it an Ltd or a partnership ?

Innovos was set up as a partnership of contractors with its own marketing resource, the idea being to find work independently of agencies and bill directly to the client. It failed for a variety of reasons, one of which was the failure to generate enough profit to pay for its own marketing overhead. When it failed, there was ISTR a furher row about who owed what and why. Finally the partner all lost significant money closing it down.

If there is a piece of work you can't do individualy but could do as a group, then you can do it as a collaboration - a virtual company, in effect, using one of your own companies as the nominal lead (or creating a ficititious one for that purpose) but it will need to be set up with watertight agreements as to how the money is managed and distributed.

Far better to get the work yourself and sub it to other contrators, if you want to build a self-supporting business. Sadly, there are no shortcuts.

[ASB]

Are you referring to http://www.innovos.co.uk/ ? The site seems down. That's exactly what i had in mind, looks they are already doing it. Is it an Ltd or a partnership ?

If I remember correctly that was started by a PCG member but I don't think it really got going particularly well.

I think you highlight the problem you have to overcome in your previous post. Basically "well pay everybody based on what they generate". Why join up then? Where is the added value?

[ASB]

Well , TimeSheets can be mandatory , and the payment can be based on the time worked on. I'd love to start smth. like that , any fellas ?

That would probably be fatal from an IR35 perspective (all other things being equal)

[2uk]

Go Google for Innovos....

But consider -five of you in a partnership, one of you does little work in a year compared to the others for any one of a dozen reasons - how much do you pay him?

Or, you build up £250k profits in a year or so and one of you gets a permie job. How much does he take away, or how much does he pay to leave...?

Much much safer to have a collaboration of five separate companies at the kind of level we work at. Building a "proper" company needs to start from a different point.

Well , TimeSheets can be mandatory , and the payment can be based on the time worked on. I'd love to start smth. like that , any fellas ?


"Collaboration of separate companies" - Do you basically refer to friendship that form between contractors - as they help each other find work ?

Are you referring to http://www.innovos.co.uk/ ? The site seems down. That's exactly what i had in mind, looks they are already doing it. Is it an Ltd or a partnership ?

[malvolio]

I am just lookin for the best scheme that is not less preferable to clients (compared to a Ltd). However one that is a flexible way for me and other fellow contractors to work under a common company, but so that the reveneue is distibuted according to how much job each partner has done.

Go Google for Innovos....

But consider -five of you in a partnership, one of you does little work in a year compared to the others for any one of a dozen reasons - how much do you pay him?

Or, you build up £250k profits in a year or so and one of you gets a permie job. How much does he take away, or how much does he pay to leave...?

Much much safer to have a collaboration of five separate companies at the kind of level we work at. Building a "proper" company needs to start from a different point.

[2uk]

No, it's not the same. Broadly as S/E you pay income tax on profits after chargeable expenses and allowances. You also pay NI in a similar way - buy employers NI is not payable (although there is different sort of NI to pay as well). Full details on the IR web of course.

You would be a bit better of as S/E than under PAYE but the regime is not as benign as an exploiting the corporate regime when outside IR35. Of course if nobdy will use your services due to the risks placed on them by the companies act then the point is moot anyway.

Regarding partnerships you might consider looking at LLP's. The possibility exisits that these might be viewed a little more favourably and it may be possible to operate through an LLP and an agency - but frankly I doubt it.

I am just lookin for the best scheme that is not less preferable to clients (compared to a Ltd). However one that is a flexible way for me and other fellow contractors to work under a common company, but so that the reveneue is distibuted according to how much job each partner has done.