How do I become a LTD driver? and apart from getting paid more by agencies what are the pro’s and con’s
gov.uk/limited-company-formation
That’s the official government website. Plenty of information on there about setting up a limited company.
You get paid more, but weigh up carefully if it really is more. Will it give you 28 days of holiday at average wage, will it mean you can contribute to a pension, can you afford at least 6 months SSP and what happens if it’s quiet and you have no work, will the enhanced rate pay for some days of no work. Because that is what the lower PAYE rate is worth.
Think about why an agency would pay a higher rate to an individual registered as a LTD company.
Do you think it’s because it’s better for the worker, or better for the agency?
Setting up ltd companies to work for an agency. Using umbrella companies. Etc etc. Lorry drivers repeatedly prove that they will grab the extra pennies and absolve their employer of any responsibility! It’s madness really!
But, if you’re still interested, I’ve got a bridge for sale. 
I’ve started thinking about this myself. In my current situation, I work for 1 agency, 1 day at a time - different assignments across different clients, get paid a different rate for each and I don’t think I get to have any paid holiday atm since I have no contract for work. If my thinking is correct: with an ltd. I’d be able to get work from several agencies without having to sign up with each and every one of them, I might be able to claim fuel costs (the places they send me to are usually 30-40kms away), could’ve claimed 250 for my sat-nav + 50ish for PPE had I had an ltd. already + meal/drinks costs throughout the shift + any expenses for training (ie. ongoing CPC, class 1, additional qualifications), personal (well, company) vehicle expenses like insurance, MOT, road tax, ongoing repair bills so in the end I might end up with a similar income as a PAYE driver.
Is this how it works or am I just day-dreaming?
ETS:
I’ve started thinking about this myself. In my current situation, I work for 1 agency, 1 day at a time - different assignments across different clients, get paid a different rate for each and I don’t think I get to have any paid holiday atm since I have no contract for work. If my thinking is correct: with an ltd. I’d be able to get work from several agencies without having to sign up with each and every one of them, I might be able to claim fuel costs (the places they send me to are usually 30-40kms away), could’ve claimed 250 for my sat-nav + 50ish for PPE had I had an ltd. already + meal/drinks costs throughout the shift + any expenses for training (ie. ongoing CPC, class 1, additional qualifications), personal (well, company) vehicle expenses like insurance, MOT, road tax, ongoing repair bills so in the end I might end up with a similar income as a PAYE driver.Is this how it works or am I just day-dreaming?
It always depends on what you get paid in either a PAYE or Ltd scenario. My lads get their training organised and paid for, they also get paid to attend and as some of our training takes place some distance from base, they get a hotel for a few nights, a meal allowance for the night and lunch. Because they are working from the same place, they have chosen to work close to base (mostly), PPE is paid for by us. They don’t really need a satnav as we tend to go to a selection of the same places.
The main difference is that everything gets taken care of for them, all I want them to do is turn up, drive, deliver, come home - everything else, the back office functions, is my problem. Makes for an easier life.
albion:
It always depends on what you get paid in either a PAYE or Ltd scenario. My lads get their training organised and paid for, they also get paid to attend and as some of our training takes place some distance from base, they get a hotel for a few nights, a meal allowance for the night and lunch. Because they are working from the same place, they have chosen to work close to base (mostly), PPE is paid for by us. They don’t really need a satnav as we tend to go to a selection of the same places.The main difference is that everything gets taken care of for them, all I want them to do is turn up, drive, deliver, come home - everything else, the back office functions, is my problem. Makes for an easier life.
Sure, but I assume you’re talking about employees on full-time contracts. I don’t believe there’s an agency in the world who would pay for any one of the expenses listed. If the choice were between full-time employment or agency, most drivers (depending on personal preference of course) would choose the former but for those stuck with the latter or not wanting to work full-time, it might make sense under certain circumstances to go the ltd route depending on what expenses could count as deductable income or w/e it’s called?
ETS:
albion:
It always depends on what you get paid in either a PAYE or Ltd scenario. My lads get their training organised and paid for, they also get paid to attend and as some of our training takes place some distance from base, they get a hotel for a few nights, a meal allowance for the night and lunch. Because they are working from the same place, they have chosen to work close to base (mostly), PPE is paid for by us. They don’t really need a satnav as we tend to go to a selection of the same places.The main difference is that everything gets taken care of for them, all I want them to do is turn up, drive, deliver, come home - everything else, the back office functions, is my problem. Makes for an easier life.
Sure, but I assume you’re talking about employees on full-time contracts. I don’t believe there’s an agency in the world who would pay for any one of the expenses listed. If the choice were between full-time employment or agency, most drivers (depending on personal preference of course) would choose the former but for those stuck with the latter or not wanting to work full-time, it might make sense under certain circumstances to go the ltd route depending on what expenses could count as deductable income or w/e it’s called?
True… I’m one of those fossils that think if someone wants to run an agency you should take people on properly. Like they used to in 1876 when I was a nipper
The thing is, as a PAYE worker, you can still claim tax relief on a whole bunch of stuff that you use specifically for work. The agencies don’t want you to know this, of course.
It would not take long, or cost much, to get advice from an accountant regarding your situation. A typical agency worker is going to be able to claim tax relief on a uniform, boots, washing their uniform, likely claim mileage for traveling to and from yards since they don’t have a fixed place of work etc etc etc. All of that, whilst earning under PAYE.
If going to see an accountant and making a plan for how to claim tax relief on your PAYE earnings sounds like too much effort… you aren’t ready for, or capable of, establishing yourself as a ltd company in order to minimise your tax bill (not to mention allowing your agency to make more money at the same time).
slowlane:
The thing is, as a PAYE worker, you can still claim tax relief on a whole bunch of stuff that you use specifically for work. The agencies don’t want you to know this, of course.It would not take long, or cost much, to get advice from an accountant regarding your situation. A typical agency worker is going to be able to claim tax relief on a uniform, boots, washing their uniform, likely claim mileage for traveling to and from yards since they don’t have a fixed place of work etc etc etc. All of that, whilst earning under PAYE.
If going to see an accountant and making a plan for how to claim tax relief on your PAYE earnings sounds like too much effort… you aren’t ready for, or capable of, establishing yourself as a ltd company in order to minimise your tax bill (not to mention allowing your agency to make more money at the same time).
I work about a mile away and I’ve had the same boots for two years and they have probably got two more in them going to an accountant would probably cost me more than my expenses. I currently on a zero hours contract regularly getting 50+ hours a week at the same place for two years now so about 40,000 a year problem is I don’t think I will get A mortgage on a temp zero hours contract and was thinking LTD might sound better when going for the mortgage
albion:
You get paid more, but weigh up carefully if it really is more. Will it give you 28 days of holiday at average wage, will it mean you can contribute to a pension, can you afford at least 6 months SSP and what happens if it’s quiet and you have no work, will the enhanced rate pay for some days of no work. Because that is what the lower PAYE rate is worth.
I’m on a zero hours temp contract I don’t get ssp when i’m ill anyway and if the work went quiet i don’t get anything anyway i’m thinking about getting a mortgage I’ve been at the same place for two years now i’m earning 40,000+ a year just though it might sound better to a lender if I was LTD rather tha a zero hours temp
For a self employed mortgage you will need at least one years accounts, more likely three years, depending on your history and deposit size.
Don’t think your current contract would matter too much if you have regular money paying in like you say. I would go for it as you are now