Can you have access to all of your earnings each month?

[Wanderer]

Apologies - I find discussion easier to take in at times

Yes dear, of course you do. Everyone finds it easier to just ask questions rather than doing a bit of light reading of the "First Timers Guide" and such like. The trouble is that it comes across as dreadfully lazy and people here do get a little bit fed up with answering the same noobie questions over and over again or hearing yet another "Does anyone know a good accountant" question.

will take the advice and read through posts before posting.

Thank you. Also read the links on the right side of the page, especially the "First Timers" section in which people have taken a lot of time to write up model answers to common questions.

It's not all black and white though so once you've been through all that, please feel free to engage us in an intellectual discussion about the finer points of your trading structure.

[simplicity]

Apologies - I find discussion easier to take in at times but will take the advice and read through posts before posting.

[northernladuk]

I think before you make the move, you should talk to one or two specialist accountants who can explain the ins and outs of working as a contractor and running your own company. I may be wrong but your post reads that there has been no consideration by your accountant of whether your contract falls inside or outside of IR35 - if it's the former you will have no right to claim dividends at all for the income earned from that contract.

With a question like this I would also advise that your read up on the guides on the right and do your own research on the absolute basics of LTD ownership and how it works. It is all there to digest before you ask your accountant anything else. You need to understand the absolute basics of something before asking questions.

[LisaContractorUmbrella]

I am slightly confused. Everyone seems to think that its better to be ltd if you are earning over a certain level but the accountants I have spoke to say I have to pay myself a basic salary and then get quarterly dividends. HOw can this make me better off. I have a mortgage to pay each month. A minimum wage salary will not help me.

So my question is how do you legally gain access to all the money you earn on a monthly basis using the ltd company route? I am with an umbrella and considering changing to ltd.

Any details of accountants would be appreciated.

I think before you make the move, you should talk to one or two specialist accountants who can explain the ins and outs of working as a contractor and running your own company. I may be wrong but your post reads that there has been no consideration by your accountant of whether your contract falls inside or outside of IR35 - if it's the former you will have no right to claim dividends at all for the income earned from that contract.

[simplicity]

Thanks - i understand I need to leave enough to cover taxes didn't know if I had to leave more.

[Clare@InTouch]

I agree with the above that there's no reason you can't take monthly dividends instead of quarterly, and it won't effect the tax result overall (assuming the dividends are split efficiently across tax years).

As long as you have the profit available, so you're leaving enough within the company to cover all taxes, then there's no reason you cannot withdraw as much as you like.

If you're completely new to all of this then it might be a good idea to have a chat with a few different accountants, that way you can get a range of viewpoints and get answers to all the questions you have - often it's better to get the same thing explained by more than one person as some may make it clearer than others!

[Pondlife]

I am slightly confused. Everyone seems to think that its better to be ltd if you are earning over a certain level but the accountants I have spoke to say I have to pay myself a basic salary and then get quarterly dividends. HOw can this make me better off. I have a mortgage to pay each month. A minimum wage salary will not help me.

So my question is how do you legally gain access to all the money you earn on a monthly basis using the ltd company route? I am with an umbrella and considering changing to ltd.

Any details of accountants would be appreciated.

Did you ask them why they thought that? As long as it's profit it's up to you - Obviously the paperwork need to be correct too.

I'd be more worried about your use of the word all. I would ask one of these accountants to explain it to you properly so that you understand your liabilities before going down this route.

[DaveB]

I am slightly confused. Everyone seems to think that its better to be ltd if you are earning over a certain level but the accountants I have spoke to say I have to pay myself a basic salary and then get quarterly dividends. HOw can this make me better off. I have a mortgage to pay each month. A minimum wage salary will not help me.

So my question is how do you legally gain access to all the money you earn on a monthly basis using the ltd company route? I am with an umbrella and considering changing to ltd.

Any details of accountants would be appreciated.

You dont HAVE to do what your accountant says, they are just making a recommendation.

Many contractors pay dividends on a monthly basis. The argument for doing it quarterly is that it makes it look less like a disguised salary should HMRC decide to investiage your tax returns.

You can also pay yourself any salary you like but it is generally accepted that minimum wage or there abouts is the most tax efficient way of doing things.


There is no reason you cant start out paying monthly dividends and then move to less frequent payments once you have a war chest established.

Any of the accountants who post on here will be able to help you out. Just do a search for recommended accountants.

[craig1]

Take a monthly dividend then.

[simplicity]

I am slightly confused. Everyone seems to think that its better to be ltd if you are earning over a certain level but the accountants I have spoke to say I have to pay myself a basic salary and then get quarterly dividends. HOw can this make me better off. I have a mortgage to pay each month. A minimum wage salary will not help me.

So my question is how do you legally gain access to all the money you earn on a monthly basis using the ltd company route? I am with an umbrella and considering changing to ltd.

Any details of accountants would be appreciated.