Have done my homework now and realise that myself and partner are "office holders" and were not employees. My bad on that one.
Accountant thought the move to inside via brolly was "the new norm" rather than the temporary situation that I hope it is. I still expect next contract to be outside. Coming off the Ltd payroll was intended to "transfer" the tax free allowance, same as MonkeysUncle.
I've instructed brolly to start paying into pension rather than to me personally. Left that a bit late to make the most of it but thanks to malvolio for pointing it out.
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Reply to: Mixing Brolly and Ltd
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Previously on "Mixing Brolly and Ltd"
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My accountant used to say the same thing, although I wouldnt call it resign. They recommended that I come off the PAYE of my LTD so that my tax free allowance could be transferred to the inside role. When that finished, go back on the PAYE for my LTD. Is that what your accountant means?
I have been inside/outside on a few roles over the last few years and always did it this way. Never had any issues with it, but wether thats the right/wrong way I couldnt say. I was doing that from the recommendation of my accountant.
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Originally posted by SailorSam View Post
Apologies for the delay responding.
Definitely resign, and P45 has been issued. Myself and partner are now both directors but not employees (partner has gone perm). Accountant is a general practice that used to have a strong contractor service but I think that has reduced over the last few years. The guy running the contractor unit was dismissed recently but i do not know why.
Are you thinking it would of been better to stay as employee and drop salary to 0?
I would argue you've never been an employee. Unless you both had a specific Contract of Employment with YourCo and had agreed not to be bound by various laws such as the Minimum Working Time directive, then you were (and remain) an officer of the company, occupying a substantive position within it. (Look it up - it's all in the Companies Act). If you did meet those criteria then that was a bit of a waste of time and effort.
It makes sense to take your living money from the company with the usual tax saving moves we all use and, as has been said, use the brolly to pay your pension up to the limit and bank the rest for your personal use. That all depends on what monies you are getting where for the contract(s) in force.
I would be a little concerned your accountant wouldn't already know all that. Perhaps you should ask him some hard questions...
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Originally posted by northernladuk View PostYou sure he said resign? You aren't employed by it and need to be part of the LTD in a director capacity. You can chose what you are paid and divi'd to suit.
They didn't talk about coming off PAYE not resigning?
Are they a contractor specialist set up or a local general bod?
Definitely resign, and P45 has been issued. Myself and partner are now both directors but not employees (partner has gone perm). Accountant is a general practice that used to have a strong contractor service but I think that has reduced over the last few years. The guy running the contractor unit was dismissed recently but i do not know why.
Are you thinking it would of been better to stay as employee and drop salary to 0?
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You sure he said resign? You aren't employed by it and need to be part of the LTD in a director capacity. You can chose what you are paid and divi'd to suit.
They didn't talk about coming off PAYE not resigning?
Are they a contractor specialist set up or a local general bod?
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Sorry but pension payments should be coming from the inside contracts.
outside contract - used to make dividend payments and your rainy day fund
inside IR35 - minimum wage and maximise the pension payment
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Mixing Brolly and Ltd
First contract this year was outside IR35 so booked through LTD and the second was inside so put through an umbrella. Accountant advised me to resign from Ltd before 2nd contract started and that seemed to make sense so I did. Is that what others would/are doing?
Future contracts are likely to be a mix of in and out and usual don't overlap (will leave that for another time) so does this mean re-hiring and resigning as and when contracts change?
One problem that I see with current situation is that pension payments from Ltd are normally made in March so I will need to be back on the Ltd payroll by then.Tags: None
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