Help: understanding limited company %

[Waldorf]

Sorry not sure if this is the right place to post :

I have spoken to a few people to try and understand the take home % possible under a limited company, but no one gives me a difinitive answer.

Can someone please advise on this:

Say I make £100k

under a limited company outside IR35:

Salary say £12,000 net of tax and employees NIC :

Annual turnover 100,000
Remuneration 14,169
Employers NIC 979
Accounts 900
Other expenses ?
Total 16,048
Profit before tax 83,952
Corporation Tax 20% 16,790
Net profit after tax* 67,162

* available for dividend

Now what I do not understand is if the £67k is tax free or do we also pay a tax on that portion ?

If so, then what would the take home % be ??

Thanks in advance.

Nixon Williams - Take Home Pay Calculator

[SueEllen]

It's best not to rely on the calculators to estimate things. The best thing you can do is read the first timers guides.

Start with the one under CUK Navigation on the right hand side and read all the links.

The PCG (Professional Contractors Group) also produces one and so does SJD Accountants. (You need to put in a email address to download it free.) I suggest you look at those as well. Just google their names and they come up.

There are many reasons for this. For example your expenses could vary to not very much as you have a client within walking distance, to a lot as you have to stay away from home and pay for flights and hotels. You may also expense things like company PC, company phones, accountants fees and insurance. This reduces your profit and the amount you have for dividends.

In regards to paying yourself a salary different accountants say different things. Some say pay yourself enough to ensure your NI payments are paid i.e. £7,200 this year to pay yourself National minimum wage.

When paying dividends it's a good idea to:
1. Have a look at the tax thresholds
2. Keep some money in the company account for lean periods - some contractors have to take time out due to family illness, their own illness or due to there not being the right role available in the area they live in.
3. Decide and action on whether the company is going to pay into the directors' pension scheme

This page shows you the tax thresholds for this tax year - Income Tax : Directgov - Money, tax and benefits

This page is helpful to work out the tax you pay on dividends - Tax on UK dividends : Directgov - Money, tax and benefits Remember the tax year for individuals runs from April to April there as your company tax year can run from the beginning of any month in the year to the next 12 months.

I suggest you read the guides I've pointed to you. Then if you have a question use the search facility of this forum as 9 times out of 10 your question will have been asked and answered in the past two years. If your question isn't answered then come back and post it.

Don't expect the members of this board to spoon feed you but do expect them to point you in the right direction so the next time you have a query you can search for the answer yourself. This avoids you worrying overnight about a query.

[karun2011]

Sorry not sure if this is the right place to post :

I have spoken to a few people to try and understand the take home % possible under a limited company, but no one gives me a difinitive answer.

Can someone please advise on this:

Say I make £100k

under a limited company outside IR35:

Salary say £12,000 net of tax and employees NIC :

Annual turnover 100,000
Remuneration 14,169
Employers NIC 979
Accounts 900
Other expenses ?
Total 16,048
Profit before tax 83,952
Corporation Tax 20% 16,790
Net profit after tax* 67,162

* available for dividend

Now what I do not understand is if the £67k is tax free or do we also pay a tax on that portion ?

If so, then what would the take home % be ??

Thanks in advance.