Reply to: Is this the end of Tax Free Divis?

[xoggoth]

Well said.

PS £500 a day? Obviously I hate you.

[bobspud]

Then ask them when they intend to jump back into permiedom, you might get a different answer.

Its all about the money. People that say its not just don't know how to join the dots.

The 3 months off traveling last year: paid for by a £500 day rate for the previous 9 months...
Picking and choosing what projects you bother to get out of bed for: A luxury granted by the 20 grand left in the bank from the last job...

Deciding when and if you bother turning up today: Yeah? get real what do you think you are a plumber?? Try wandering in to a £25 million project as a senior staff member and telling them you plan to work 4 days a week for the next 6 months.

Being your own boss: You are _NEVER_ your own boss its just that the boss is replaced by a customer (hint: customers are worse than bosses, because they don't have to pay if they don't like what you did. )

Big industry want well skilled professionals that will build up and tear down a project as needed.
They don't want staff that need their noses wiped and their careers massaged.
They don't want a bench count.

Contractors want: Money and the freedom granted by it.
So they risk the sales cycle and their skills set against the market.

The last thing BIG Business wants is a massive increase of employees because the government want to make tax FAIR

[cojak]

well i am only new to contracting but i have met at least 20 contractors in my career so far and not one of them was in it for anything other than the money....

Then ask them when they intend to jump back into permiedom, you might get a different answer.

[northernladuk]

well i am only new to contracting but i have met at least 20 contractors in my career so far and not one of them was in it for anything other than the money....

I would suggest that you are asking the wrong questions then. I would hazard a guess as you are concerned with the money then that is how the conversation goes. I am sure if you then mentioned other benefits to contracting they would be up for those as well. I also know a lot of contractors who are in it for the money and I could (incorrectly) state they were in it just for that but that isn't the full picture. Ask them how many people would do a permie job for a similar rate and it will be a whole different set of answers IMO

[NorthWestPerm2Contr]

If you're only in it for the money, no, it isn't.

well i am only new to contracting but i have met at least 20 contractors in my career so far and not one of them was in it for anything other than the money....

[cojak]

Reading around it seems the LibCons are going to stop us receiving tax free divis (on our side not the company side) for up to the tax limit. If so is it even worth contracting anymore?

If you're only in it for the money, no, it isn't.

[NorthWestPerm2Contr]

here is one

Should contractors be cheering IR35

[centurian]

I still think this is fundamentally odd:
Company has £x carried over from a previous year.
If it pays it to the workers they have to pay full tax on it.
If it pays it to the shareholders, they don't.

But it doesn't really pay that money to workers. Whether it's taken from reserves or current year's takings, ultimately it reduces profits in the current year, which means less corp tax to pay.

So either way, roughly the same amount of tax gets paid (forgetting about NI).


But there is still no recent link on this...

[xoggoth]

Still no up to date link on this?

[Moscow Mule]

I still think this is fundamentally odd:
Company has £x carried over from a previous year.
If it pays it to the workers they have to pay full tax on it.
If it pays it to the shareholders, they don't.

Total tax take is roughly the same though...

[thunderlizard]

I still think this is fundamentally odd:
Company has £x carried over from a previous year.
If it pays it to the workers they have to pay full tax on it.
If it pays it to the shareholders, they don't.

[centurian]

Unless of course they set it so you pay CT on company profits AND are taxed fully on dividend income, but that sounds a bit weird... surely the worst that can happen is you're forced to take full salary as if caught by IR35?

Hence their promise to "simplify" IR35

[Moscow Mule]

I'd be amazed if most self employed tradesmen pay tax on more than 50% of what they actually earn. Try finding anyone to work on your house who will actually take a cheque for payment.

Try fiddling your tax if we all have to become self employed - it's quite difficult to hide BACS payments from clients...

[Lockhouse]

Look at the date on the article.

[GreenerGrass]

So, you all think it's unethical to pay tax on the money you earn at the same rate as people with regular jobs? Seems strange, if you work as self-employed you don't escape tax.

I'd be amazed if most self employed tradesmen pay tax on more than 50% of what they actually earn. Try finding anyone to work on your house who will actually take a cheque for payment.