alix776:
Why are you paying liability ins that’s why the customer has insurance I take it your on umbrella then
What stress your runing a business and as such no holiday pay etc is what you signed up for. It’s very simple to run. Pl is only round 250 per year if your terms are right then you would be covered then company your driving fors insurance
Maybe the regs are different in the UK but if youre LTD you then become a director and therefore an employee of that company meaning you need employee liability insurance…
alix776:
Why are you paying liability ins that’s why the customer has insurance I take it your on umbrella then
What stress your runing a business and as such no holiday pay etc is what you signed up for. It’s very simple to run. Pl is only round 250 per year if your terms are right then you would be covered then company your driving fors insurance
Maybe the regs are different in the UK but if youre LTD you then become a director and therefore an employee of that company meaning you need employee liability insurance…
I don’t have ELI but that was a decision that is about to change. At the moment the only employee of the company is me and therefore the one person in the world least likely to sue me. It was just wasted money.
As for the changes to the flat rate scheme they are annoying BUT combined with the other tax benefits of being LTD it breaks down like this:
Assume a driver on £11.50 p/h working the maximum 48 hours a week over 2 26 week reference periods to make the year.
PAYE Driver will earn £28,740 of which £11,500 will be tax exempt after April. Paying tax and NI on the rest will come to around £5,344.00 meaning take home pay for that driver is 23,395.60.
LTD Co. Driver on £1.50 more an hour plus flat rate VAT will turnover £32,646.48 after paying VAT due to HMRC in a year. He can pay himself £11,500 straight off plus the annual dividend allowance of £5,000 which means unless the driver can find other ways to extract money without a tax burden they will pay tax on the remaining £16,146.48. Tax and NI on that is £5,005.41 giving £11,141.07 left to the driver or a total take home income of £27,641.07 or £4,245 a year more income, all perfectly legally.
Of course both ways can add upto another £6,235.60 to the take home if they receive the full current HMRC Subsistence Allowence of £26.20 per night and do a five day week followed by a six day week all year.
[quote=“alix776”
Also public liability doesn’t cover the operators vehicles it only covers the public and ie you put a box on the floor and some one trips over it[/quote]
Though the operator could claim for damage caused to his vehicles by improper use by the driver. E.g.forgetting to wind the legs down on a trailer.
While none of the above concerns me it all sounds good all this extra money, but what happens when your LTD for a company full time and work goes slack who will they tell to stay at home the ltd man or the paye man who they have to pay whatever how will that affect the figures?
mac12:
While none of the above concerns me it all sounds good all this extra money, but what happens when your LTD for a company full time and work goes slack who will they tell to stay at home the ltd man or the paye man who they have to pay whatever how will that affect the figures?
In 20 months of Ltd work on agencies I have had three days off I didn’t want. You know when its going to go slack, plan other things for then. Last January I did my HIAB licence in the slack times. This year I booked a TM CPC but have actually lost out on work because of it. The fact remains that even in the slack times you should see 2-3 days a week on agency and a Ltd Co. driver will earn almost as much in those 3 days as the PAYE man will in a week.
So on your figures above you say 2 drivers working same place 1 PAYE 1 LTD the LTD will take home £4245 more in a year, now I don’t understand any of it but will the LTD get paid 6 weeks holiday pay at £3744 or will he have to work all year if not that’s brought it down to £500 extra and then a lot of LTD will have an accountant, pension, sick pay and insurance to pay out of that £500.
Like I say I don’t understand how it all works.
mac12:
So on your figures above you say 2 drivers working same place 1 PAYE 1 LTD the LTD will take home £4245 more in a year, now I don’t understand any of it but will the LTD get paid 6 weeks holiday pay at £3744 or will he have to work all year if not that’s brought it down to £500 extra and then a lot of LTD will have an accountant, pension, sick pay and insurance to pay out of that £500.
Like I say I don’t understand how it all works.
You make a fair point, but I also gain a lot in flexability and other benefits. I’ve never run as a company planning on doing this forever and have always worked for just my tax personal allowance plus subsistence and expenses. I don’t need more than 15k a year to be comfortable so re-invest and as a result, after less than two years trading I have gone from no capital to the point of putting my own unit on the road.
Cov:
I just ditched ltd .Low rate vats gone .so if you take say £13 ph over £12 paye .your on a massive loser
No holiday accrued .not security .and all for a few quid a month after you pay the accountant liabilty insurance etc etc.It is not worth it unless you are an owner driver charging a lot more etc.paye unless you are truelly a business .It is just not worth the stress …
my mate’s done the same saying the hassle for the extra money wasn’t worth it + he is convinced that sooner rather than later that the hmrc are gonna crack down on the self employed that work for only 1 firm like he was doing
Hades3000:
I have often seen agencies referred to as leeches in many threads.
As I see it, for example, an agency will provide a driver to a company for £20 hour. From that the driver gets £11 hour and the rest goes to profit etc.
My question is, if you present yourself as a self employed / Ltd, to a company who requires a driver and miss out the agency, can you negotiate a better hourly rate for yourself rather than the agency making the money. So in the above example the company are being charged £20 by the agency, as a self employed, I could charge £15 saving the company £5 from the agency cost.
I’m sure this topic has been discussed already but despite having a good look round, I didn’t come across anything specific.
I understand also that it can be a pain adhering to all the requirements under self employed, but I would just like to know in this thread whether the above is achievable and whether some of you may already be doing this?
Thanks in advance
That’s not a fair characterisation of the agency’s profit. The agency have staff (and typically premises and other expenses) that have to be paid for, and the £20 an hour that the hirer pays is for the additional services that the agency provide (at least part of which is as an apparently credible front to keep you, the driver, at arms length in terms of employment rights).
If you cut yourself down to £15 an hour gross, you’re more or less going to see the same hourly rate for your work as the employee on £11 an hour, unless you fiddle your tax. And you may not even get offered £15 an hour, unless it is a very small firm who just want a casual driver and who know your character well enough to think that you’re a good risk for colluding with to avoid PAYE tax.
Hades3000:
I will be actively exploring the issues raised when I contact the hmrc next week and will post up my findings. Thanks for all the responses
Be aware however that HMRC can only answer you based on the information you give them, and the person you speak to over the phone will not necessarily have any tacit knowledge about the daily role of a HGV driver, and won’t ask you probing questions. If you mischaracterise your situation, even unintentionally, a tax inspector or a tribunal can still take a different view about your arrangements later on.
I was investigated by HMRC about 15 months ago. Not over being a self employed HGV driver but over 2 houses I rent out but my ltd company got caught in the investigation.
They asked me for the following information,
1 Details of my company bank account. It had to be in my company name not my name it also had to match all income and expenditure for my company and they wanted an explanation for any expenses not paid for through that account. They wanted 3 years of statements.
2 They wanted copies of my companies insurance documents.
3 I had to provide proof that I had worked for more than 1 agency and also provide copies of my tender documents that I was supposed to use every time the agency provided me with different contracts because if we where self employed we should not be on the same rate.
4 I was asked to provide my training programme (cpc, h&s haz mat ect)
5 I was also asked to provide information on what work I had sought other than through an agency.
6 They did say that at no point did I require my own wagon if I conformed to the above.
I am now in full time employment because the whole experience was a nightmare( I still have the 2 houses because the where the easy part of the investigation.
HMRC are horrendous once they get you in their sights!
I once had an investigation because they claimed I was working for cash. I’m a very specialist carrier, with various government licenses, I’m just not going to do that kind of thing.
The investigation went on for nearly three years, the cost of which to defend was horrendous. They went through every nitpicking thing they could do, to the point of saying there is a bill here and it says Colnbrook but it doesn’t match any timesheets, so you have to go through it all and point out that Slough on a timesheet is the same thing.
God knows how much it cost the taxpayer for them to spend all those man hours combing through my records. At the end of it, they owed me £832.00 on some tax technicality that I could never understand.
I have to say, never has a cheque been more joyfully banked.
albion:
HMRC are horrendous once they get you in their sights!
I once had an investigation because they claimed I was working for cash. I’m a very specialist carrier, with various government licenses, I’m just not going to do that kind of thing.
The investigation went on for nearly three years, the cost of which to defend was horrendous. They went through every nitpicking thing they could do, to the point of saying there is a bill here and it says Colnbrook but it doesn’t match any timesheets, so you have to go through it all and point out that Slough on a timesheet is the same thing.
God knows how much it cost the taxpayer for them to spend all those man hours combing through my records. At the end of it, they owed me £832.00 on some tax technicality that I could never understand.
I have to say, never has a cheque been more joyfully banked.
