I mean actual advice on how to, not pros/cons etc. From someone who’s running one or has done recently. Thanks
Why are you setting up a Ltd Co?
Not worth it as an agency driver because the IR35 rules come into force in less than 9 months time. HMRC have stated in clear unambiguous language that unless you own the lorry you’re driving you’re not going to be meeting rules for being self employed as a driver.
Setting it up is easy, buy an off the shelf company and just submit the names for the directors/secretary and registered office address.
If you’re asking how to set up a Ltd Company then you clearly haven’t even done the most basic research into the business so shouldn’t be doing it. If you did proper research into starting your business you wouldn’t need to ask the question.
Here is the ABC of how to start.
gov.uk/set-up-limited-company
Follow all the steps, and all the links, and then maybe ask some “targeted” questions?
.
And almost echoing Conor, if you cant follow the Gov instructions, then maybe running a company isnt for you.
peirre:
Why are you setting up a Ltd Co?
Probably because he’s seen the extra whopping £1/hour increase over PAYE that some agencies are paying!!
I’ve just left a job in a different industry where we were LTD, the hourly rate was increased properly over PAYE lads so it was worth it. But with the imminent IR35 (ignore what some are saying that it isn’t coming in, the Govt are needing more income and its a easy way of getting it), hours cut due to Covid, and the amount of lads and lasses looking for work so driving wages down, I got out as soon as I could. I’m now taking home similar to what I have been since the hours cut with a lot less hassle and once its in my bank its mine, so not needing to put some aside for insurances/accountant/tax bill/holidays.
I’m shutting my LTD down, as I have no intention of ever going that route again (not that I’d be allowed). Most of the lads I worked with will be forced to go umbrella PAYE in April, as none of the contractors want them on their books. I was definitely not going that way, as its all the expense of LTD but without the tax saving benefits.
Henrys cat:
peirre:
Why are you setting up a Ltd Co?Probably because he’s seen the extra whopping £1/hour increase over PAYE that some agencies are paying!!
I’ve just left a job in a different industry where we were LTD, the hourly rate was increased properly over PAYE lads so it was worth it. But with the imminent IR35 (ignore what some are saying that it isn’t coming in, the Govt are needing more income and its a easy way of getting it), hours cut due to Covid, and the amount of lads and lasses looking for work so driving wages down, I got out as soon as I could. I’m now taking home similar to what I have been since the hours cut with a lot less hassle and once its in my bank its mine, so not needing to put some aside for insurances/accountant/tax bill/holidays.
I’m shutting my LTD down, as I have no intention of ever going that route again (not that I’d be allowed). Most of the lads I worked with will be forced to go umbrella PAYE in April, as none of the contractors want them on their books. I was definitely not going that way, as its all the expense of LTD but without the tax saving benefits.
Pardon my ignorance on this subject, but what’s the difference between PAYE and Umbrella PAYE?
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Take heed of some of the advice here, or you could face a hefty tax bill in the future.
I gave it up 4 years ago, when the threat of IR35 was doing the rounds then, but now that threat is real.
Ken.
eastyorkslass:
Henrys cat:
peirre:
Why are you setting up a Ltd Co?Probably because he’s seen the extra whopping £1/hour increase over PAYE that some agencies are paying!!
I’ve just left a job in a different industry where we were LTD, the hourly rate was increased properly over PAYE lads so it was worth it. But with the imminent IR35 (ignore what some are saying that it isn’t coming in, the Govt are needing more income and its a easy way of getting it), hours cut due to Covid, and the amount of lads and lasses looking for work so driving wages down, I got out as soon as I could. I’m now taking home similar to what I have been since the hours cut with a lot less hassle and once its in my bank its mine, so not needing to put some aside for insurances/accountant/tax bill/holidays.
I’m shutting my LTD down, as I have no intention of ever going that route again (not that I’d be allowed). Most of the lads I worked with will be forced to go umbrella PAYE in April, as none of the contractors want them on their books. I was definitely not going that way, as its all the expense of LTD but without the tax saving benefits.
Pardon my ignorance on this subject, but what’s the difference between PAYE and Umbrella PAYE?
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PAYE you’re employed direct by the firm/agency and they pay employers National insurance and you get paid holiday pay
Umbrella PAYE you are employed by a 3rd party firm who the firm your driving for pays your hourly rate to. Out of this rate you get deducted their margin (amount to process your pay), employers NI, possible the apprentice levy, and depending on the umbrella company a deduction to bank for holidays. Your hourly rate will be slightly higher than working direct, but the firm your driving for can bin you off straight away as you’re not actually employed by them.
When it was supposed to come in last April, we looked into it as I was going to be forced down that route, due to the rate of pay meaning I would be a higher rate tax payer, I was around £50/week worse off than my LTD company. Plus HMRC are closing alot of the expenses you can claim on umbrella which made it worse.
Okay, you’ve changed my mind. I’m too late to the party. I won’t bother. Thanks anyway
Henrys cat:
peirre:
Why are you setting up a Ltd Co?Probably because he’s seen the extra whopping £1/hour increase over PAYE that some agencies are paying!!
I was hoping the OP would give us a specific answer before the barrage started.
But to update you on your response, as a PAYE driver the Ltd Co drivers where on £1/hr more than me prior to April, however since April and the introduction of Pay parity for PAYE agency staff, the PAYE staff got an equivalent of a 25%-30% pay rise upping their pay by £3-£4/hr, the Ltd Co drivers are still being paid the same rate, which has effectively put them £2-£3/hr behind the PAYE guys. Needless to say I know a couple of them who are very cheesed off atm despite being told to switch over before the lockdown started.
In addition to Franglais’s post, once you are setup, you will need a business bank account
After that, Liability insurance and you’re set.
That IR35 boogeyman has been coming every April for years - Still hasn’t arrived and with this current Covid business, I can’t see IR35 coming April 2021 either.
There are ways around the IR35 rules, you just need to figure it out, or pay a chartered accountant in the know to tell you how to operate. (Have a search as this has been covered many times on here)
Before you setup, look into the costs involved with running a company, especially when it comes to filing or having someone file on your behalf - HMRC can hand out eye-watering fines if you get it wrong
Liability insurance Is/was optional especially if you are doing agency work
Conor:
Not worth it as an agency driver because the IR35 rules come into force in less than 9 months time. HMRC have stated in clear unambiguous language that unless you own the lorry you’re driving you’re not going to be meeting rules for being self employed as a driver.Setting it up is easy, buy an off the shelf company and just submit the names for the directors/secretary and registered office address.
If you’re asking how to set up a Ltd Company then you clearly haven’t even done the most basic research into the business so shouldn’t be doing it. If you did proper research into starting your business you wouldn’t need to ask the question.
So could you enlighten us all Conor as to how a self employed owner driver and a director of a Ltd Co selling his labour to a company are connected?
IR35 has zilch to do with owning a truck, it’s about leveling up the tax system for different ways of working especially when doing the same job as an employee of a company.
A self employed driver and a driver employed as a director via the Ltd company are totally different. It’s all pretty unambiguous really.
IR35 will most likely put an end to Ltd Co drivers, that is until some wise Alec exploits the many grey areas that these legislations always come with.
What a shame that the ability to screw the tax system is slowly being addressed. Imagine a world where we are that selfish & greedy that we do not want to contribute money, yet are more than happy to use the NHS, police, fire service etc…
eagerbeaver:
What a shame that the ability to screw the tax system is slowly being addressed. Imagine a world where we are that selfish & greedy that we do not want to contribute money, yet are more than happy to use the NHS, police, fire service etc…
Yeah imagine a day when the likes of Amazon, Apple etc. multi-billion scammers start paying any taxes. Hell and sub-zero temperatures etc.
Does a week go by without some story about some rich guy/gal getting busted for taxes, like Messi, CR, Hollywood ‘‘starts’’ etc who only got caught because they were so stringy they got a discount accountant/lawyer…If the richest of the rich don’t like paying tax can you blame the working poor for feeling screwed?
I’ve just come of that umbrella ■■■■ myself, first weeks pay, better off. Not having to pay employers NI along with my NI and PAYE plus their fees. The agency sell it that you’re on a higher rate, but that’s wiped out with the fees. The umbrella co try and tell you to put in expenses etc to lower your tax, no thanks I’m not dodging tax. I’d rather just pay it now in bits rather than a massive hit when the tax man comes knocking.
My agency even rang me up during the lock down telling me I need to set up as a Ltd Co as the company I was working for won’t be accepting umbrella anymore. They were pushing some company that did ltd co equivalents or something. I just told them I want no part of tax dodging and sign me up for your PAYE ASAP.
On the outside it may LOOK like PAYE are worse off but in the end it works out better, especially with the new Parity pay rates that came in Recently.
Yep the working man working the system legally to save on tax is a tax fiddler in the eyes of the bigots but the multi million/billionaires doing the same are seen as entrepreneurs.
robbo99.:
Yep the working man working the system legally to save on tax is a tax fiddler in the eyes of the bigots but the multi million/billionaires doing the same are seen as entrepreneurs.
There are double standards at play for sure. Better to get the rich to pay a fair share rather than let others copy or aspire to their antisocial selfishness?
Franglais:
robbo99.:
Yep the working man working the system legally to save on tax is a tax fiddler in the eyes of the bigots but the multi million/billionaires doing the same are seen as entrepreneurs.There are double standards at play for sure. Better to get the rich to pay a fair share rather than let others copy or aspire to their antisocial selfishness?
And have a tax authority that is fit for purpose and not sit on their hands for year after year after year doing absolutely nothing and then landing people with massive tax bills, ie The Loan Charge which HMRC wanted to land 20 year retrospective tax bills on unsuspecting workers. Complete and utter shambles, the government bang on about how well HMRC have handled this pandemic, they ought to look at the Counter Avoidance side of HMRC.
ETS:
eagerbeaver:
What a shame that the ability to screw the tax system is slowly being addressed. Imagine a world where we are that selfish & greedy that we do not want to contribute money, yet are more than happy to use the NHS, police, fire service etc…Yeah imagine a day when the likes of Amazon, Apple etc. multi-billion scammers start paying any taxes. Hell and sub-zero temperatures etc.
Does a week go by without some story about some rich guy/gal getting busted for taxes, like Messi, CR, Hollywood ‘‘starts’’ etc who only got caught because they were so stringy they got a discount accountant/lawyer…If the richest of the rich don’t like paying tax can you blame the working poor for feeling screwed?
Try not to worry about American tech companies or European footballers mate. This is TNUK so I assume you are either British or working in the UK. If you want to avoid paying tax, just simply say so. " Others are stealing so I will too…" a great reasoning there Chief 
Apart from the fact that Amazon and Apple employ thousands of people in the UK who pay millions in tax, you are trying to avoid paying ANY. So I gather you won’t ever want a doctor, ambulance or copper and you will be happy to let all the criminals out of prison as we won’t have any prison officers? Let’s not bother sending our kids to school either.
As far as I am concerned people who don’t contribute but are happy to take are called parasites. Get some pride about you and pay some tax.