Please help me do contract maths!!!

[SteveMcadden1]

Ok I ve done a lot of due dilligemce on this and I just want to see whether I have missed anything

assume I work 240 days a year at 400 a day and I do not need to take any of the money out for the foreseeable future

am I correct in thinking that gross pay is 96 k which after corporation tax is about 78k??

And this can all be taken out at 10% effective tax by using entrepreneurs claim

I make out I can take home 70k after tax using this

anyone confirm pleeeasse???!!!

[SteveMcadden1]

Ok I ve done a lot of due dilligemce on this and I just want to see whether I have missed anything

assume I work 240 days a year at 400 a day and I do not need to take any of the money out for the foreseeable future

am I correct in thinking that gross pay is 96 k which after corporation tax is about 78k??

And this can all be taken out at 10% effective tax by using entrepreneurs claim

I make out I can take home 70k after tax using this

anyone confirm pleeeasse???!!!

I woul really appreciate help here

if anyone can also indicate what perm salary thy would need to nit take this contract that would also be a tremendous help

[pmeswani]

I woul really appreciate help here

if anyone can also indicate what perm salary thy would need to nit take this contract that would also be a tremendous help

Have you tried speaking to an Accountant? I hear some of them are quite good at this sort of stuff.

[PhilAtBFCA]

Steve,

You could try using the spreadsheet and video explanation on this link.

You could also use this to estimate the perm salary you would need for the same net income, but be careful with this as its not really comparing like for like, its less mathametical than that as you may have benefits from being a contractor that are non financial, and a different risk. So much depends alos on career level, age, personal circumstances etc. etc.

And no you cant just apply entrepreneurs relief and close the company as a matter of course. You can only do that if that company ceases trade, and you may have already extracted dividends and salary out beforehand.

Hope that helps a bit !

Phil

[jmo21]

240 * £400 = £96,000

Corp tax is calculated after all expenses are deducted.

Your salary is an expense for the business.

so if you paid yourself £96,000 salary........ how much corp tax would you pay?

21% of........ Bueller??

(clearly accountancy fees and other things must be accounted for....but you see where I'm going don't you?)

[Crossroads]

Ok I ve done a lot of due dilligemce on this and I just want to see whether I have missed anything

assume I work 240 days a year at 400 a day and I do not need to take any of the money out for the foreseeable future

am I correct in thinking that gross pay is 96 k which after corporation tax is about 78k??

And this can all be taken out at 10% effective tax by using entrepreneurs claim

I make out I can take home 70k after tax using this

anyone confirm pleeeasse???!!!

240 working days a year...I'd be a little more conservative with your planning if I were you.

[dozer]

i always consult the highly qualified and anonymous users of internet forums for any important information in my life.

well done for ignoring fees and the correct tax rate.

[tim123]

Ok I ve done a lot of due dilligemce on this and I just want to see whether I have missed anything

assume I work 240 days a year at 400 a day and I do not need to take any of the money out for the foreseeable future

am I correct in thinking that gross pay is 96 k which after corporation tax is about 78k??

And this can all be taken out at 10% effective tax by using entrepreneurs claim

I make out I can take home 70k after tax using this

anyone confirm pleeeasse???!!!

Being allowed to take out the cash balance of the company as a capital gain when you wind it up is a concession that the revenue can disallow.

I can't see them be very happy to allow it if the company never paid out any of its income to the directors using "normal" payment methods, BICBW.

tim

[stevo kane]

if you don t need to touch the money. you can also go on anice holiday near the end of the year. before the end of your co tax year. make sure you are long enough away to not be in a tax resident for uk and not long enough to be one inthe countries you are travelling. that way you can pay yourself a wage without deducting tax as you are not doing the work in the uk.

[DiscoStu]

if you don t need to touch the money. you can also go on anice holiday near the end of the year. before the end of your co tax year. make sure you are long enough away to not be in a tax resident for uk and not long enough to be one inthe countries you are travelling. that way you can pay yourself a wage without deducting tax as you are not doing the work in the uk.

Fail