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  1. Stan Barwik
    Offline

    Stan Barwik Spark mate

    Location:
    Glasgow
    Hello everyone,

    I know that I'm just fresh in here, but....we all have to start somewhere.
    This post is directed mostly to Spark mates/improvers who can share some of their knowledge and experience with "going" LTD.
    Yes, yes, I have seen threads about CIS (used to do some time through CIS), about that how agencies are bad and Umbrela (ultimate scam)...don't let me even start.

    If it's possible, I would like to ask you people, how does it go with LTD for spark mates?
    I realize that system, agencies etc try to discourage people going this way, because it is more complicated than CIS because you need accountant(it really is recommended), insurance etc. But I also know that, they are afraid that more and more people will go Ltd and the tap with warm blood of honest people will dry out.

    I have an idea about opening Ltd co. opening business bank acc. my main concern is with business insurance. I have asked about it and that is what they require from spark mate (for one of the contracts):

    -Employers Liability : £10M - well, my Ltd would be only me director who employ meself....don't think it is actually possible to get eployers liability insurance if I do not employ anybody but myself?

    -Public Liability: £2M - that's not a problem, standard I would say.

    -Professional Indemnity: £2M - this option is only available to buy with insurance, when you answer YES to question: "Do you offer advice, design or certification in your business activities".
    Now big problem as always is .....money, insurance with Professional Indemnity put your insurance premium sky high.
    Agencies won't hire any mate/improver through CIS because apparently, we only work under supervision :tearsofjoy:, and from mate working through own Ltd they want us to do what fully qualified sparks do?

    Is that practise (Professional Indemnity) a standard for Ltd mates , or it depend on a contract for different jobs?

    That is my main concern which holds me back from going Ltd.

    If any of you could put some inside and own experience to the subject, that would be great.
    Also if any of you fellow Electricians mates/improvers and fully qualified Electricians, encountered other worrying aspects of going Ltd, please comment. I believe that forum will only enrich with your advice:blush:

    Thank you all

    Ps. Quite a subject as for first post :tearsofjoy:
     
  2. spinlondon
    Offline

    spinlondon Forum Mentor

    Location:
    Harlow Essex
    Ok, you will only need Public Liability.
    If the Agencies say different, then it’s just because they don’t want to use you through a LTD company.
    You’re a mate so not qualified.
    This means your advice as an unqualified person, legally holds no more weight than that of any other unqualified person.
    If you do decide to go LTD, you should also steer clear of an agencies that want you to be paid through a payroll company.
    The agency excuse of IR35 doesn’t work for LTD companies.
     
    • Like Like x 1
  3. Stan Barwik
    Offline

    Stan Barwik Spark mate

    Location:
    Glasgow
    @spinlondon@spinlondon thanks for info.
    have you ever seen anything like that ?
    "Our records show that we don’t have confirmation that you wish to opt out of ‘The Conduct of Employment Agencies and Employment Businesses Regulations 2003’."
    is this what you are talking about with IR35 ?
     
  4. spinlondon
    Offline

    spinlondon Forum Mentor

    Location:
    Harlow Essex
    Hmm. No not really.
    Agencies have for some time now used IR35 as an excuse not to pay direct. Their reason being: that they would have to employ you after a couple of months.
    Instead they pay through pay roll companies which they invariably own, and charge a fee.
     
    • Like Like x 1
  5. Stan Barwik
    Offline

    Stan Barwik Spark mate

    Location:
    Glasgow
    It's not a news, that they want squeeze from people as much as they can.
    Is there any way to fight it, or we can just try, and tell them that we are not OK with payment through pay roll companies?
    For most cases, that would probably mean: we just do not take the job, and keep looking...
     
    • Agree Agree x 1
  6. spinlondon
    Offline

    spinlondon Forum Mentor

    Location:
    Harlow Essex
    I think all agencies now use payroll companies.
    Only way round them is to go LTD.
    I tried for a year, but there was too much paperwork for me.
    Other option is to try to work direct for companies.
     
  7. SWD
    Offline

    SWD Gender neutral Electrician's Arms

    Location:
    London
    LTD is only worth it if you are earning a decent wedge and what you can claim for as "allowances"
     
  8. Stan Barwik
    Offline

    Stan Barwik Spark mate

    Location:
    Glasgow
    @spinlondon@spinlondon & @SWD@SWD , thanks for your suggestions ;)
    If I understand correctly, despite that being on your own in your Ltd, having Tax return from every year (extra money), not paying double NIC for agencies and extra £15-£25 from each week pay (well that's how much accountant would cost me, but Ltd can deduct their costs), actually Ltd can claim nearly everything except corporate TAX...

    is it still better to go through Umbrela on a mates wages average gross £500-£540 a week? and not being able to claim any travel expenses, because that is what I hear from agencies.
     
  9. SWD
    Offline

    SWD Gender neutral Electrician's Arms

    Location:
    London
    When I worked in IT the guys under Umbrella rules would upload receipts for travel and subsistence but that was a few years back and I know HMRC have tightened down, if you are on £500 per week there is no point in going limited you need to be on about £40k to make it worthwhile now, yes you can claim for loads of stuff I claimed for computer equipment an office at home travel, lunch, a couple of biles, £125 per year for a Christmas outing and even a Christmas tree for the "office" which was in my house........
     
  10. SWD
    Offline

    SWD Gender neutral Electrician's Arms

    Location:
    London
    Agencies don't want people "self employed" as they push them towards Umbrella status they make money out of it.
     
    • Agree Agree x 1
  11. spinlondon
    Offline

    spinlondon Forum Mentor

    Location:
    Harlow Essex
    I don’t think you quite understand SWD.
    Umbrella means paying Tax, NI, employers NI and the payroll company fee.
    Ltd means just paying 20% CIS tax
     
  12. Stan Barwik
    Offline

    Stan Barwik Spark mate

    Location:
    Glasgow
    @spinlondon@spinlondon I think SWD just shortened the story. As he said, he used to run through Ltd and he can see more sense in doing that with higher turnover, about £40k.
    I still see other benefits from running own business, even with small difference on + overall, just for a reason, all NIC payments go to MY pensions scheme, not someone in the middle.
    Hope that will make more sense.
     
    • Agree Agree x 1
  13. SWD
    Offline

    SWD Gender neutral Electrician's Arms

    Location:
    London
    I have a LTD company, going Umbrella means that you are technically self employed working as PAYE and being screwed over by the agency.
     
  14. spinlondon
    Offline

    spinlondon Forum Mentor

    Location:
    Harlow Essex
    Yes.
    The OP could save himself somewhere in the region of £170 - £180 per week by going Ltd.
    Less whatever his fees for being Ltd would be.
     
  15. SWD
    Offline

    SWD Gender neutral Electrician's Arms

    Location:
    London
    On a wage of £540 pw?
     
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