Reply to: LTD company for occasional freelance work. Is it going to cost more than I will earn

[northernladuk]

Nope the fact it's fixed price trumps everything - as the financial risk is passed to the contractor - that's a clear outside verdict even on CEST

Agreed. As I say, we've always got to make assumptions to help questions like this but this one looks as clear as it can be so we can discount the inside option until the OP tells us otherwise.

[Manic]

Nope the fact it's fixed price trumps everything - as the financial risk is passed to the contractor - that's a clear outside verdict even on CEST

I agree, not sure I would bet my house on it being fixed price based on the information though. It might simply have been an estimate to provide the valuation against the limited company costs.

[eek]

Not enough information to know. You all know simply having an SoW for adhoc work is not enough. The working practices are key here along with any direction and control.

Nope the fact it's fixed price trumps everything - as the financial risk is passed to the contractor - that's a clear outside verdict even on CEST

[Lance]

I'd suggest a LTD. This is not umbrella land. Would need a separate umbrella contract for every piece of work. An umbrella could likely be more paperwork than a LTD rather than less.

I'd also suggest finding a local accountant to help rather than our usual suggestions.

And don't bother with VAT. All the accountant needs to handle is payroll and company returns so should costs less. If they want more than £1k then use on of the usual ones in the threads here.

[Manic]

I know assumptions can be a dangerous thing but reading the OPs post what do you think it will be? Is he working like a disuised permie? Would the agency have offered LTD if it was inside?

You know as well as I do the agency might not have any idea. If it's a small business, the impact could be on the OP.

Edited to say - NLUK, you are normally **** hot on stuff like this

[Manic]

Not enough information to know. You all know simply having an SoW for adhoc work is not enough. The working practices are key here along with any direction and control.

[eek]

Question not asked yet which will have a big impact. Will the work fall inside IR35 legislation?

It's £2000 per a piece of work - so outside IR35 Statement of Work type projects without any control required.

[northernladuk]

Question not asked yet which will have a big impact. Will the work fall inside IR35 legislation?

I know assumptions can be a dangerous thing but reading the OPs post what do you think it will be? Is he working like a disuised permie? Would the agency have offered LTD if it was inside?

[Manic]

Question not asked yet which will have a big impact. Will the work fall inside IR35 legislation?

[northernladuk]

Back in the day we used to say that 30K was the threshold where using a LTD started to eclipse a brolly dependent on some factors. The expense policy changed so I'd expect that figure to change slightly but there hasn't been enough movement in taxation for this figure to be much different I don't think. So based on that I'd say deffo brolly.

[jayn200]

It's only a problem if you try to be clever - running your own accounts isn't much of a hassle using Freeagent (I know you don't use it). If all the OP needs is money coming in and out via dividends and they can avoid paying a salary there is little effort involved.

Yeah i agree plus no need for vat registration either.

[eek]

And when the OP comes back to ask for help, I can imagine the ribbing they'll get...

It's only a problem if you try to be clever - running your own accounts isn't much of a hassle using Freeagent (I know you don't use it). If all the OP needs is money coming in and out via dividends and they can avoid paying a salary there is little effort involved.

[ladymuck]

I actually think a limited company may be possible but you will need to do the accounts yourself to make it worthwhile

And when the OP comes back to ask for help, I can imagine the ribbing they'll get...

[eek]

Umbrellas don't tend to like sporadic work but it's worth describing the scenario to a couple and see what they say.

Will the agency run a payroll for you? Sounds like they won't or they'd be offering it.

I'd be hesitant to set up a LtdCo for this but that may end up being your only option.

I actually think a limited company may be possible but you will need to do the accounts yourself to make it worthwhile

And that's possible if you get a Mettle (Natwest) bank account as Freeagent is free with that and they now do the CT600 for you.

But you would need to keep things incredibly simple - which might be possible if you are doing this on top of another job (so taking the money via dividends rather than payroll).

If you are doing it as your sole income it's going to be a problem.

[ladymuck]

Umbrellas don't tend to like sporadic work but it's worth describing the scenario to a couple and see what they say.

Will the agency run a payroll for you? Sounds like they won't or they'd be offering it.

I'd be hesitant to set up a LtdCo for this but that may end up being your only option.