Reply to: Own LTD company

[Denny]

is that £419 per day/week/month?

if it is per month and you do more than 79 hours per month then your ltd co is not paying you min wage and therefore could be a problem.......

This is not a bona fide way of managing your affairs. The smaller the salary the smaller the divis too to keep outside higher tax bracket. SJD recommend a much higher salary than what you've said you pay yourself.

You are asking for trouble.

[jh0711]

yes but the point is if you do not pay yourself min wage then HMRC do not get the tax and NI they should do on your earnings - so they will investigate you and do all in their power to prove you are a disguised employee and so should have been paid a salary (and thus have paid some tax etc)

the main thing is if your ltd co appears to be purely set up to avoid paying tax you will be investigated

obviously if you can prove you are a genuine company (say you have a website, business cards, maybe advertise your services in certain relevant publications) then all will be fine

if you think about HMRC work they firstly see the accounts then think hmmm something looks dodgy lets see what we can do down the IR35 route

what they do not do is investigate shed loads of contracts see which ones pass or fail IR35 and then see who is working on each contract and then investigate the payroll method.

so if you accounts 'look' more like a genuine ltd co then they are less likely to investigate you

pay yourself a bit more salary stop being so greedy and you should be ok

lets face it who ever heard of a company with no employees?????????

.... maybe

[Bear]

minimum wage only applies if you have a contract of employment with your company. As a director you do not need a contract of employment, therefore you can pay what you want.

if I remember right, if your title suggests a role (e.g finance director) then it starts to get complicated as the role implies a contract of employment

[jh0711]

is that £419 per day/week/month?

if it is per month and you do more than 79 hours per month then your ltd co is not paying you min wage and therefore could be a problem.......

[dotnetter]

It's always better to go with a Ltd company tax wise.

What I do is pay myself £419 wages and the rest comes from dividend.

The £419 means you wont inccur income tax and pay minimal NI.

Get yourself a decent accountant, it's worth it he will advise you on what you can claim for and what you can't.

Basically, all you need to do every month is leave 19% of your income in the company account which will cover everything, and at the end of the year, put any taxable expenses against you tax bill to get it down to around 15%.

So you get a nice bonus come year end.

Also you can get VAT registered which means you can ear a little extra from that too,

With regards to claiming subsitance without reciepts, I did it for ages through 2 different umbrella companies at £5 per day.

[Cactus]

...and there I was thinking that I was winning an argument....As a married man I do need that kind of gratification every once in a while

Forget it! it'll never happen!

[To BI or not to BI?]

to BI or not to BI? el duder is winding you up

...and there I was thinking that I was winning an argument....As a married man I do need that kind of gratification every once in a while

[Cactus]

Sorry, but this is wrong. Do you have proof of this?

I have always claimed daily subs through an umbrella at a standard rate without proof of receipts.

to BI or not to BI? el duder is winding you up

IMHO I'd forget about the subsistence claims unless you're working away on an overnight stop.

[To BI or not to BI?]

Sorry, but this is wrong. Do you have proof of this?

I have always claimed daily subs through an umbrella at a standard rate without proof of receipts.

http://forums.contractoruk.com/threa...tml#post163368
and
http://forums.contractoruk.com/thread12666.html

[el duder]

Only if you stay overnight (£5 per day if in the UK or £10 per day if you are abroad). Any other "unreceipted" subsistence claim may be contested by Hector

Sorry, but this is wrong. Do you have proof of this?

I have always claimed daily subs through an umbrella at a standard rate without proof of receipts.

[Bear]

I prefered your first answer!

[To BI or not to BI?]

I wish!!

oops, minor type. I meant, of course, ~£38k.

Thanks Bear for pointing that out

[Nixon Williams]

Thanks to everyone that has replied you have been a great help.
I think I won't claim for petrol and food subsitance if it can land me in trouble.

It is nice to be able to ask experianced people for help and advice on this forum when needed.

By sounds of it it seems as a contractor you can end up with a similar salary as if you were permanant with an agency for example I have just found out from giant that I am supposed to be putting 80 pound a side a week for self assessment that I will have to pay because of my dividend. I don't understand this because I thought mananged companies dealt with all the tax, NI etc that your supposed to pay to inland Revenue.

I don't have any income coming in except this contract but no expenses and putting money aside leaves me with 67% of my salary so am I better off working permanant where I will get holidays and benefits.
My current contract falls outside IR35.

The simple answer is that you would be better off with your own company than permanent, any dividends you are paid will only have company taxes accounted for, you will have to keep some aside to meet your personal taxes. (If you are a higher rate tax payer, otherwise there is no extra tax due).

Alan

[Bear]

or I think it may be ~£338k,

I wish!!

[To BI or not to BI?]

this is all bulltulip.

even if you go through an umbrella or mananged company you are allowed to claim a standard daily subsistence rate without proof of receipts.

Only if you stay overnight (£5 per day if in the UK or £10 per day if you are abroad). Any other "unreceipted" subsistence claim may be contested by Hector