Limited company directors NI

[MJPD29]

Out of interest what is this amazing job you have I could do with it

 

[Deleted member 26818]

When I had my Ltd Co, I registered it for CIS.
I then had to make a monthly return listing all the subcontractors my Ltd Co employed.
If I did not employ anyone that month, I had to make a NIL return.
If I only employed myself, I was still required to submit a return, listing myself as the only subcontractor.

I find it very odd that it would be illegal to employ myself as a subcontractor, yet I was required to list myself on the return.

As for the suggestion that you cannot work in a roll for a company, and then subcontract to that company in another roll, you need to think again.
This again is something that I have personal experience of.

 

[Scott Jacob]

Out of interest what is this amazing job you have I could do with it

Shift spark

 

[45140]

Spinlondon.

A couple of observations

1 : CIS means paying full personal tax including above the marginal rate, so until now dividends would have only attracted 20% and not marginal tax, so you would have paid more Tax through CIS surely ?

2 : HMRC have for several years operated a test that determines if you are genuinely self-employed or not. On the face of what you say you would have failed that test. I believe the Pimlico case now locks this up.

3 : Operating CIS avoids NI and tax from a Ltd Company, and also is at odds with the legal requirement for a Director to work in the interests of the shareholders by maximising revenue.

4 : HMRC is seriously understaffed and uses many staff who simply work from basic training or scripts. It also does not have the resources to chase up smaller amounts or every piece of wrongdoing it identifies. It concentrates on the bigger, easier and cheaper to Prosecute cases. Prosecuting a smaller Company or an individual may cost tens of thousands more than can be recovered and so is seen as being a waste of taxpayers money.

5 : I imagine your accountant considered there was some benefit to you but my accountant this morning was very negative indeed about such an arrangement.

 

[Deleted member 26818]

To start with, I don’t mind paying tax or NI.
I would rathe pay less than more, but I’m not out to fiddle anything.

The majority of my work is through agencies, and agencies won’t pay direct unless you have a Ltd. Co. Some agencies are now refusing to pay Ltd. Co.s direct.

Without a Ltd. Co. you get paid through a payroll company, owned by the agency you’re working for.
The payroll company charges a fee which is now somewhere around £30.

All I want, is to get my money without having to pay someone to get paid.

 

[Nigel]

Spinlondon.

A couple of observations

1 : CIS means paying full personal tax including above the marginal rate, so until now dividends would have only attracted 20% and not marginal tax, so you would have paid more Tax through CIS surely ?

2 : HMRC have for several years operated a test that determines if you are genuinely self-employed or not. On the face of what you say you would have failed that test. I believe the Pimlico case now locks this up.

3 : Operating CIS avoids NI and tax from a Ltd Company, and also is at odds with the legal requirement for a Director to work in the interests of the shareholders by maximising revenue.

4 : HMRC is seriously understaffed and uses many staff who simply work from basic training or scripts. It also does not have the resources to chase up smaller amounts or every piece of wrongdoing it identifies. It concentrates on the bigger, easier and cheaper to Prosecute cases. Prosecuting a smaller Company or an individual may cost tens of thousands more than can be recovered and so is seen as being a waste of taxpayers money.

5 : I imagine your accountant considered there was some benefit to you but my accountant this morning was very negative indeed about such an arrangement.

Well said.

 

[Deleted member 26818]

Well said.

Maybe well said, but there is an inaccuracy, a couple of misconceptions and a lack of relevance.

 

[Nigel]

Maybe well said, but there is an inaccuracy, a couple of misconceptions and a lack of relevance.

No there is not. It is you that is either lying or avoiding the correct tax that you should be paying

 

[Deleted member 26818]

Let me try you with a scenario.
I stop working as an electrician, and go work in a car repair garage.
I’m there a few months and my boss decides to have installed a new 2 post lift.
The new lift needs a supply which the lift installers won’t do, so my boss has to get an electrician in to do it.
He gets 3 quotes, then offers me the work for the cheapest quote.
I agree and when the work is complete, I invoice my boss.

According to you, that would be illegal.
According to me, that would be all fine and above board.

 

[45140]

To start with, I don’t mind paying tax or NI.
I would rathe pay less than more, but I’m not out to fiddle anything.

The majority of my work is through agencies, and agencies won’t pay direct unless you have a Ltd. Co. Some agencies are now refusing to pay Ltd. Co.s direct.

Without a Ltd. Co. you get paid through a payroll company, owned by the agency you’re working for.
The payroll company charges a fee which is now somewhere around £30.

All I want, is to get my money without having to pay someone to get paid.

Not trying to be argumentative or controversial, but if you are aid through a Ltd Company operated by an Agency then you are in effect subject to IR35 and working through an umbrella company, which is an iniquitous system foisted on us by Labour, and tightened down by those poltroons Osborne and Hammond. Now you get none of the benefits of paid employment but pay far greater tax than anyone else.

It has hugely damaged the public sector such as Crossrail, LUL, Network Rail, HS2, etc because these organisations are simply paying the normal salary but under IR35 conditions which means double NI and no access to pension, sick pay or holiday pay that you do not pay for additionally out of your already overtaxed pittance With CrosssRail paying £300 a day for senior engineers, you can see why the Project is now a national embarrassment. All travel and lodging costs are not allowed neither are any out of pocket expenses so by the time you have paid for these the oney being paid is on par with a bus driver, so many senior engineers have retired or work overseas.

I understand that the NHS has a major problem with the massively high number of contract staff it has.

 

[Deleted member 26818]

Not trying to be argumentative or controversial, but if you are aid through a Ltd Company operated by an Agency then you are in effect subject to IR35 and working through an umbrella company, which is an iniquitous system foisted on us by Labour, and tightened down by those poltroons Osborne and Hammond. Now you get none of the benefits of paid employment but pay far greater tax than anyone else.

It has hugely damaged the public sector such as Crossrail, LUL, Network Rail, HS2, etc because these organisations are simply paying the normal salary but under IR35 conditions which means double NI and no access to pension, sick pay or holiday pay that you do not pay for additionally out of your already overtaxed pittance With CrosssRail paying £300 a day for senior engineers, you can see why the Project is now a national embarrassment. All travel and lodging costs are not allowed neither are any out of pocket expenses so by the time you have paid for these the oney being paid is on par with a bus driver, so many senior engineers have retired or work overseas.

I understand that the NHS has a major problem with the massively high number of contract staff it has.

I only work CIS, I refuse any work, where I would be paid umbrella.
You are incorrect about Crossrail paying Umbrella, they pay PAYE (JIB rates), you get sick pay, holiday pay a pension and BUPA.
Getting travel and lodging can be a problem, depending upon how the agency words the contract.
Some agencies say that you are on a fixed contract (with no end date), so no travel or subsistence and that you are employed from the site, so there is no travel even if you’re not on a fixed contract.