Limited company directors NI

[Deleted member 26818]

That can't be correct can it?
I know plenty of people who have a full time paye job plus another job that they do on a self employed basis.
As long as it's declared on their tax return what's the problem?
If true then that makes a lot of firemen law breakers.

I think what Essex is trying to say is:
“It’s illegal to be paid as a subcontractor if you’re being treated as an employee.”

 

[andyb]

I think what Essex is trying to say is:
“It’s illegal to be paid as a subcontractor if you’re being treated as an employee.”

And is it?

 

[Octopus]

This thread demonstrates perfectly that sparks can’t give tax advice as we can’t agree (like economists) AND the UK tax system is too open to interpretation

 

[Deleted member 26818]

And is it?

I don’t know whether it’s actually illegal, but if HMRC find out they will take action against the employer to make them pay what’s owed.

 

[The Ghost]

thanks for the useless advice

If you don’t have an answer dont post on it

Charming, sure know how to charm the ladies eh?

 

[Nigel]

That can't be correct can it?
I know plenty of people who have a full time paye job plus another job that they do on a self employed basis.
As long as it's declared on their tax return what's the problem?
If true then that makes a lot of firemen law breakers.

What I am saying is it is illegal for someone to work for a company as a PAYE but get paid as a SE contractor. I am not saying you cannot work for company A as PAYE and for company B as a subbie. I am saying you cannot work for a company as a subbie if you are really working as PAYE but not being oaid as PAYE.

All this is on the HMRC website and is very clear.

 

[Nigel]

I don’t know whether it’s actually illegal, but if HMRC find out they will take action against the employer to make them pay what’s owed.

If you are the company managing director it is crystal clear that you are responsible for the day to day running of the business and as such should be employed PAYE. There is no way a managing director can get away with considering themselves as a casual worker with no responsibility for their work to warrant SE employment. It is a joke to even consider as such.

 

[Nigel]

This thread demonstrates perfectly that sparks can’t give tax advice as we can’t agree (like economists) AND the UK tax system is too open to interpretation

I am gobsmacked that some members on here consider themselves business people. Some lack of basic business knowledge is alarming.

 

[Octopus]

^^ darling with pople is abother key attribute ..... sumething surely licking in mont trades pople too

 

[45140]

You cannot work for Company A in any capacity and then also sub-contract to that Company

You CAN work for Company B as a sub-contractor, you simply declare the income as untaxed income, or taxed income from another source.

The most efficient way to pay yourself as a Director is to either pay just below NI limits and then use the remaining unused tax to offset dividend tax or you pay yourself to the limit of your tax free earnings and then pay tax on everything above.

There is now also a personal dividend tax of 7.5% on all dividends paid above £2000. So for tax purposes its 19% Corporation Tax and from you a further 7.5% until you hit your marginal rate. Ltd Company is becoming a less attractive option unless you have a non-working wife who you can employ.

Remember also that HMRC get very funny indeed about interim dividends and will require a full blown account producing. I believe it is still possible to pay yourself an interest free loan provided that it is paid off inside the tax year, otherwise they expect interest to be paid.

As others have already suggested this really is one for the Accountant.