• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

Anybody thinking of liquidating their Ltd co. already?

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    Anybody thinking of liquidating their Ltd co. already?

    I am finishing my current contract end of the month. I am very tempted to start the closing down process as soon as the final invoice is paid, take the money and just work with an umbrella company from now on.

    Anyone else considering this?
    Last edited by OneManBand; 6 November 2019, 11:12.

    #2
    I'm currently contracting for one of the banks that have announced they're no longer going to be engaging PSC's in the future. I might be tempted to liquidate if there's an offer of a longer-term contract on the table, i.e. 12 months or so. If they're only going to offer 3 or 6 months then I'd rather take my chances with finding another client. From what I gather HMRC can't (or won't) investigate a closed company so if I want to stay with my current client then liquidating is my only option. I'll set up another Ltd after the 12 months is up if there's still a need in the market for contractors working outside I35.
    • The meaning of life is to give life meaning
    • Worrying about tomorrow spoils today

    Comment


      #3
      The way I see it, if I close the company down, I can't lose.

      The trend is very much anti-Ltd company. Keeping the company open would just be wasting money at a slow rate, and by closing it I might even have one less thing to worry about as far as Hector is concerned.

      Can anyone see any flaw with my plan?

      Comment


        #4
        No flaw. If you have a look in the Future of IR35 section and some of the posts in this area you will see there are a lot of people doing exactly the same and are much further on in the process than you.

        Plenty of discussion for you to catch up on.
        'CUK forum personality of 2011 - Winner - Yes really!!!!

        Comment


          #5
          Originally posted by OneManBand View Post
          The way I see it, if I close the company down, I can't lose.

          The trend is very much anti-Ltd company. Keeping the company open would just be wasting money at a slow rate, and by closing it I might even have one less thing to worry about as far as Hector is concerned.

          Can anyone see any flaw with my plan?
          Yes


          Sent from my iPhone using Contractor UK Forum

          Comment


            #6
            Phoenixing

            Comment


              #7
              I'm still paying myself a salary out of mine while I'm on the bench, which is why I'm keeping it open for the time being.

              Around about Feb I'll close it down, before next year end. I liked working like this for 15 years but don't think the model will exist anymore soon.

              Also the massive increase in red tape (MTD etc), persecution of ltd co. contractors by HMRC etc has made it a less appealing prospect.

              Not sure that perm roles appeal much (I like to have an end date) but they are pretty much the only calls I'm getting at the moment.
              Last edited by LadyPenelope; 6 November 2019, 13:15.

              Comment


                #8
                Originally posted by Anonimouse View Post
                Phoenixing
                Phoenixing is only an issue if I open another company, right? What if I'm contracting through an umbrella company?

                Comment


                  #9
                  Originally posted by OneManBand View Post
                  Phoenixing is only an issue if I open another company, right? What if I'm contracting through an umbrella company?
                  Almost certainly no issue.

                  Comment


                    #10
                    For those that are married and have a non-working spouse, there's always the option of gifting the shares to your spouse (perhaps make up some spurious story about them running a business eg, selling their own art) and then they can continue to get a salary and pay themselves dividends. It'd save a bit of tax over doing all dividends or dividends and MVL.

                    Considerations
                    • Could HMRC look to involve TAAR, even though it is a gift of shares to a spouse - low risk?
                    • Is keeping the business alive also keep the risk alive of HMRC having something to chase should they do a review of past contracts and determine them inside - probably low risk, but not impossible
                    • Make sure the tax savings are more than the ongoing cost of keeping the company open
                    • Be wary of putting expenses through the company - only those that are truly required for the spouses business - don't get greedy/silly!
                    Last edited by Paralytic; 6 November 2019, 14:05.

                    Comment

                    Working...
                    X