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What am I?

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    What am I?

    Good afternoon,
    I've just set up as a limited company on the recommendation of Brookstones and although I've spoke at length to them I am still no wiser than when I started. So if anyone can answer a couple of question I'd appreciate it.

    1) As a Director, am I an employer of myself or an employee?

    2) Tax and NI. Brookstones have said, if I give them hours worked, travel costs, etc. they will invoice the company I am working for. Brookstones will then pay that amount into my business account and advise how much of it should be transferred into my personal account, the remainder will be used to pay any costs and the end of the tax year, i.e. they pay £1000 into my business account, and advise I transfer £700, the remaining £300 is for costs. So is my Tax and NI taken from the £300, or will I have to pay it out of the £700?

    They have told me that the money I transfer will be a dividend and not a wage? it's all very confusing.

    Thanks in advance
    Dan

    #2
    Are you sure you are with Brookstones?

    If we can clarrify who you are with we can advice. I'm not sure why your business account is still in play here and as an umbrella contractor you can only claim extra travel to odd sites, not to the client site you'll be at daily etc.

    Link the company...
    'CUK forum personality of 2011 - Winner - Yes really!!!!

    Comment


      #3
      My mistake, it's Brookson (Accountants for Contractors, Limited & Umbrella Companies - Brookson)

      I didn't think I was an umbrella contractor, as I set up a Ltd company?

      Comment


        #4
        If you've set up an limited company then we should assume you're a director and shareholder of your company.

        If your limited company has a PAYE scheme (payroll scheme) set up, then we should assume you're both the employer and employee of your limited company.

        Your second point makes no sense at all. In reality, your limited company should be raising the invoice to the client, collecting the cash and paying yourself a salary. Any profit after corporation tax is where dividends are paid out of. Your accountant could be providing a bookkeeping service for you. Raising invoices for you is unusual but not out of the question. Collecting cash and playing about with transfers here and there into your limited company is plain weird and wrong. My guess is that something has been lost in translation or not explained properly to you.

        My suggestion us to perhaps go back to them and explain clearly what the whole set up is. Better yet, get them to email you an easy to read summary which you can refer back to. If you're still struggling at this point, ask for another personal accountant to deal with you.

        Comment


          #5
          Thanks for the input.
          My company does not have a PAYE scheme set up.

          I have an app/software provided by Brooksons that is linked to my business bank account. All I have to do is input my clients details, agreed terms, hourly rates etc. Then every week/month I input hours worked and any expenses, then they invoice the client on my behalf. The following week/month they update the app to show how much is in my business bank account and what they advise I transfer to leave enough in to pay for, I assume, tax etc.

          Comment


            #6
            Originally posted by danwins224 View Post
            Thanks for the input.
            My company does not have a PAYE scheme set up.

            I have an app/software provided by Brooksons that is linked to my business bank account. All I have to do is input my clients details, agreed terms, hourly rates etc. Then every week/month I input hours worked and any expenses, then they invoice the client on my behalf. The following week/month they update the app to show how much is in my business bank account and what they advise I transfer to leave enough in to pay for, I assume, tax etc.
            You really need to understand your business structure and responsibilities as a Director. Start with the First Timers.guid on the right.

            This is really important.

            Comment


              #7
              Originally posted by Old Greg View Post
              You really need to understand your business structure and responsibilities as a Director. Start with the First Timers.guid on the right.

              This is really important.
              Cheers, never noticed that, will have a look now.

              Comment

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