Reply to: Umbrellas

[malvolio]

Possibly - to put it in perspective, my accountant's fees a year are about two days gross income out of an average 200 chargeable, so that's 1%. I've yet to see any umbrella/comp/managed company deal that would meet that - but then I would never use such a beast myself and haven't done a lot of research.

[Spacecadet]

You'd have to be on a pretty crap rate for £50 a month to look like bad value compared to a standard 5ish% brolly fee.

I meant 5-10% is far too much to be paying for a brolly when a lot of them charge about £50 fixed.

Or maybe thats what you meant.. its late and i'm tired

[Mordac]

Who pays the accountant when you're running you're own ltd?

And 5%-10% for an umbrella company??? £50 a month fixed fee more like.

You'd have to be on a pretty crap rate for £50 a month to look like bad value compared to a standard 5ish% brolly fee.

[cojak]

Faust was the OP.

He wasn't offering advice to himself - he just had a cr@p accountant.

HTH

[Spacecadet]

OK. So since the umbrella and the LtdCo live in the same tax environment, subject to the same rules and regulations, and you don't have to pay anyone to run your limited whereas an umbrella costs you 5%-10% service charges, then how do you explain an umbrella returning a greater net income than your own company other than because of your own incompetence, if we don't assume imaginative accounting?

Who pays the accountant when you're running you're own ltd?

And 5%-10% for an umbrella company??? £50 a month fixed fee more like.

[Spartacus]

Come on, Faust. You can't in reply to someone being advised to go own Ltd say "but own Ltds pay more tax" and then claim that isn't advice, "just a statement".

And an incorrect statement at that.

[Dalek Supreme]

That was not advice. It was a statement, based on experience. If going with a Ltd company works for you, great. For the thousands of people who go with umbrellas, also great.

Come on, Faust. You can't in reply to someone being advised to go own Ltd say "but own Ltds pay more tax" and then claim that isn't advice, "just a statement".

[malvolio]

Being as in my last couple of years as director of my own Ltd company I ended up paying over £25k each year in corporation tax, then I chose to do the latter. Different strokes. Different folks

OK. So since the umbrella and the LtdCo live in the same tax environment, subject to the same rules and regulations, and you don't have to pay anyone to run your limited whereas an umbrella costs you 5%-10% service charges, then how do you explain an umbrella returning a greater net income than your own company other than because of your own incompetence, if we don't assume imaginative accounting?

[Faust]

I think it looked to most that you were advising that one should not use own Ltd as that way you pay more tax than with an umbrella. Are you now saying that is not the advice you were giving?

Oh.

My.

God.

That was not advice. It was a statement, based on experience. If going with a Ltd company works for you, great. For the thousands of people who go with umbrellas, also great.

Being as in my last couple of years as director of my own Ltd company I ended up paying over £25k each year in corporation tax, then I chose to do the latter. Different strokes. Different folks. (And that's not advice. It's just a saying.)

[BillHicksRIP]

If you're intending to leave Prosperity4 before the date listed in your contract with them, then best of luck. Avoiding them like the plague in the first place would have been much better.

[Dalek Supreme]

A quick cursorily glance at my posts shows that I'm not offering advice. In fact, I was just looking to glean some other options from other people who do use umbrella companies.

I think it looked to most that you were advising that one should not use own Ltd as that way you pay more tax than with an umbrella. Are you now saying that is not the advice you were giving?

[Faust]

*sigh*

Okay, let's take this from the top...

I don't fiddle my expenses. I claim for what I use. If the next guy along wants to claim for all and sundry with no receipts and get away with it, then that's entirely up to him, and to be frank, not really my concern.

A quick cursorily glance at my posts shows that I'm not offering advice. In fact, I was just looking to glean some other options from other people who do use umbrella companies.

[Dalek Supreme]

So then, Faust, an umbrella returns more money if you engage in illegal tax evasion? And this is serious advice to the OP is it? Sign up to someone like P4 and fiddle your expenses?

[MrsGoof]

P4 don't really make a secret of the fact that they pass on savings to the contractor by offsetting expenses from the monthly tax bill.

and if they are NOT GENUNIE and NOT RECIEPTED then Gordo or his successor will come and get you

[Faust]

Ignoring the 'stupid' inference, in my personal experience, I found that what I was paying in PAYE and NI combined with corporation tax was higher than what I would pay with any number of umbrella companies.

Admittedly, my accountant was no great shakes, and unfortunately, wasn't really an adequate filter between HR and my letterbox.

P4 don't really make a secret of the fact that they pass on savings to the contractor by offsetting expenses from the monthly tax bill.