I know this has prolly been done but...

[BlasterBates]

So is Parasol OK

60% of salary...

What should one be aiming for...?

[cojak]

if people who didn't like them voted with their feet and told their contrcator mates, then they'd be forced to do something about they way they work, until then why bother?

well people are voting with their feet - I've just pointed a chum who wanted to jump The Big One's ship to Parasol (and this board of course - are you out there Dear?)

[needmorstuff]

so that £125 should really be in the region of £200.

cheers guys.

[boredsenseless]

I'm with the big one, just paid my tax bill on self-accessment, cost me a £11k, that was tax 2004-2005 and first tax on account payment for 2005 - 2006. No other revenue but my contract, which for 2004 to 2005 was quite low.

GIANT will tell you what to do but it seems only after you have signed up and costs you £250 plus vat for there help. I did it myself not diffcult.

Good point I totally forgot about payment on account.

If the IR believe that you will continue to have similar large taxable amounts that are not paid by drip-feed throughout the year (i.e. dividends instead of salary) they are entitled to ask you to pay on account for the next year (usually 50%) this prevents the goivernment from running short of money, or indeed you running off with the money!

[Ivor1]

I'm with the big one, just paid my tax bill on self-accessment, cost me a £11k, that was tax 2004-2005 and first tax on account payment for 2005 - 2006. No other revenue but my contract, which for 2004 to 2005 was quite low.

GIANT will tell you what to do but it seems only after you have signed up and costs you £250 plus vat for there help. I did it myself not diffcult.

[needmorstuff]

And this is exactly the sort of thing Giant should be telling you, but aren’t. Do you see what I mean about them?

Giant did tell me to hold back £125 a week to cover liabilities at the end of the year.
10 hehe.
Planeit - you must have had it bad with them, sorry to hear that. I have had it bad with every accoutnant/umbrella company I have ever dealt with so i feel your pain.

boredsenseless - thanks for that m8y - u have cleared it all up for me and it now makes sense. The fact that they told me to hold back 125 a week = 6k on a 48 week year is a good thing then. That was my major concern that I would have a tax bill at the end of the year that they didnt tell me about.

What has peed me off is that in the initial figures they touted it did not deduct this 125. It was not untill i got to the very bottom of the calculation that they deducted this amount. But I suppose at leats they did tell me.

Thanks guys/gals and good luck with whoever you are with.

[boredsenseless]

Come on be fair, he's only 10.

PS I agree with anything bad anyone says about giant.

I don't have a problem with Giant, they are only 'bad' because their is no incentive to change, if people who didn't like them voted with their feet and told their contrcator mates, then they'd be forced to do something about they way they work, until then why bother?

[PerlOfWisdom]

I am a contractor of 10 years

And this is exactly the sort of thing Giant should be telling you, but aren’t. Do you see what I mean about them?

Come on be fair, he's only 10.

PS I agree with anything bad anyone says about giant.

[planetit]

And this is exactly the sort of thing Giant should be telling you, but aren’t. Do you see what I mean about them?

[boredsenseless]

Yes. This will be assessed from your tax return and you will get a bill.

tim

Tim's right (once again) you will have a tax shortcoming that you will need to deal with. However from your workings you appear to have missed some key points.

Firstly National Minimum Wage, therefore you'll 'earn' £10K in a year just to comply.

Secondly to take 50,000 in dividends (to make your 60K including NMW) you would need Giant to pay Corporation Tax on your behalf of 19% but thats 19% of the whole to leave 50000. So the actual amount is

50000/81*100 = 61,750 (approx)

You will get 50K of this 61,750 (remember you've already shaved 10K of you earnings to comply with minimum wage, so your 60K take home has now cost you 71,750)

Now anything you earn over 33,000 (approx) will be subject to tax, so assuming no rental income, second jobs or bank interest you will have 27,000 of taxable income

10,000 Wage
50,000 Dividend
------
60,000
-------
33,000 40% threshold

27,000 left.

This is taxed on your self assessment form, but when you boil it down it effectively works out as a 22.5% tax (or thereabouts)

so you will pay an additional 27000/100*22.5 = 6075 in tax

Therefore this is your position

You earn 71,150
Wage etc 10,000
Company Profits 61,150
Corp Tax 11,150
Dividend 50,000
Further Tax Liability 6,075

Which means you'll pay 17,000 (approx) in tax, I've assumed you recieve all the 10K minimum wage payments without tax although in reality there is a small charge on this

so from 71K you receive 54K

Obviously I'm not an accountant so you might want to get these figures checked, but they are a decent starting point. The IR online self assessment form deals with dividends without you having to do any calculations so you can just plug the figure straight in so its easy really.

[tim123]

I3 if my take home pay at the end of the year is 60k after deductions (50k of this is divs taxed @19% 60k-19%=roughly 50k) will i pay some higher rate tax??
(

Yes. This will be assessed from your tax return and you will get a bill.

tim

[Rebecca Loos]

don't think the service is legally flawed - they just let you decide for yourself what is alloweable expenses and what isn't. They pay you minimum wage + divis with their Powerhouse scheme, which is fine as long as you are outside IR35

Yes they will fu.ck up your tax, ER NIs and EE NIs from month to month but not too much and the return is still good for a safe legal scheme.

[planetit]

From my personal experience with Giant the main problem you will have is that they will charge you lots of money and feck everything up. After that, your other questions become largely irrelevant.

Still, it’s your funeral.

[needmorstuff]

I am a contractor of 10 years and have been ltd b4 and have used several umbrellas. I am with "cough" p4 at the moment and am getting worried.

I want to leave them but was peeved about my tax going up untill i came across Giant. My tax will still go up with them but not as much as everyone else. This as you know is due to the div's thing.

Q's
1. are the only concernes with giants managed ltd company thing that at the end of the year you may have another tax bill due to higher rate tax liabilities...?
2 is the service legally flawed?
3 if my take home pay at the end of the year is 60k after deductions (50k of this is divs taxed @19% 60k-19%=roughly 50k) will i pay some higher rate tax??

confused