Reply to: Two contractors - One LTD ??

[Paralytic]

Ideally you don't want to work with an agent, as I'm yet to find one that isn't stupid

FTFY

[oilboil]

You don't want to work with a stupid agent because they are likely to do other stupid things.

Ideally you don't want to work with an agent, as I'm yet to find one that isn't capable of doing stupid things without warning

[m0n1k3r]

Were it not for agents often being awkward and stupid I would have suggested the same but I've had difficulty with agents in the past over the fact Mrs Eek is a director and 50% share holder.

And you don't want to lose a 6 month £50k contract for want of a stupid agent.

You don't want to work with a stupid agent because they are likely to do other stupid things.

[northernladuk]

It did used to be that if two earners worked for the same LTD. it was a positive pointer towards being outside ( the old business entity tests)..

I'm not sure it does. The only one that comes close was 'Assistance test - Does employ workers who bring in 25% of turnover? (Yes = 35pts)' which isn't just having two separate contractors, neither employed so I thought this was no help to us.

But it died in 2015 so whatever.

[Madge67]

Fabulous advice and lots of food for thought so thank you for taking the time out to reply - off to speak to an accountant next.

[LondonManc]

All good points but all based on being bum on seat contractors rather than running a real business.

This dilemma is a microcosm of LTD company contractor.

It did used to be that if two earners worked for the same LTD. it was a positive pointer towards being outside ( the old business entity tests).

There is no right or wrong though so seek professional advice and consider the points mentioned.
Also consider death of one of the individuals involved as that too has a bearing.

That reads as very sinister first time round....

[Lance]

All good points but all based on being bum on seat contractors rather than running a real business.

This dilemma is a microcosm of LTD company contractor.

It did used to be that if two earners worked for the same LTD. it was a positive pointer towards being outside ( the old business entity tests).

There is no right or wrong though so seek professional advice and consider the points mentioned.
Also consider death of one of the individuals involved as that too has a bearing.

[eek]

I'd go one each for the reasons that Eek mentioned as I've also had contracts stipulating shareholding .It's also just a lot cleaner for when one gets and inside and the other gets an outside further down the line as well.

+1 - dividend payments would be a nightmare if one is inside earning £70,000 while the other is outside and wishes to pay themselves £40,000 in dividends.

[LondonManc]

If hubby is likely to bill a lot more than you i would go for one company.
If you are likely to be the main biller then one each

You're thinking of marriages, not limited companies

In all seriousness, though, while there is the obvious cost saving, there is the issue of having the controlling interest as some contracts stipulate.
Your accountant or lawyer may have better advice (I'd hope they would!)

[ChimpMaster]

Think forward of when you quit contracting and want to close the companies. If BADR remains in force then you would be better off have 2 companies so that you could gain BADR on both at some point. You and Mrs probably won't be able to have a 50/50 share of each company though - but best to discuss with a tax specialist.

Also on the other hand don't solely plan for something i.e. BADR, that might not be around in 10 years time (or however long you intend to contract).

[ladymuck]

There are pros and cons to sharing a company and its well worth talking it though with an accountant. If there is potential for one of you to earn significantly more than the other then you need to have a frank discussion between you about how you want to arrange your finances. An accountant will tell you the options around different share classes, salary vs dividend etc. etc. but there's also how you both feel about money and earning power to consider. How would you feel if hubby took 6 months off but kept drawing salary and dividends out of what are essentially your earnings?

Hate to say it but, if you were to split up, a shared company could be a bit of a curse too.

[northernladuk]

I'd go one each for the reasons that Eek mentioned as I've also had contracts stipulating shareholding .It's also just a lot cleaner for when one gets and inside and the other gets an outside further down the line as well.

[Fraidycat]

Both hubby and I are contractors (different clients)

If hubby is likely to bill a lot more than you i would go for one company.
If you are likely to be the main biller then one each

[eek]

I’d go the opposite way to eek.

If you are sure of continuity of business post April then I’d do the one LTD. with you both as directors and equal owners.

Talk to an accountant though. And understand the responsibilities of being a director.

Were it not for agents often being awkward and stupid I would have suggested the same but I've had difficulty with agents in the past over the fact Mrs Eek is a director and 50% share holder.

And you don't want to lose a 6 month £50k contract for want of a stupid agent.

[Lance]

Two contractors - One LTD ??

I’d go the opposite way to eek.

If you are sure of continuity of business post April then I’d do the one LTD. with you both as directors and equal owners.

Talk to an accountant though. And understand the responsibilities of being a director.

I’ve never had an agent insist on a single director. Doesn’t mean it’s never happened mind but not in my experience.
My wife is a director of my LTD purely in case I drop dead. The accountant advised it as the simplest way for her to be close it down.