New to possible contracting and after some advice (Umbrella Co or Ltd)?

[davethedog]

Evening all and please bear with me as this is all new to me.

Bit of history, left the Armed Forces in Jul 2019 after 28 years service and drawing a military pension of approx £22.5K per annum (taxed but not NIed).

May have the chance to run some day training for a large company in the UK and this may lead to further work and a possible further career (TBC). Will only be working the odd day here and there.

If I want to earn money for running a days training (let's say approx £800 per day to me after tax etc) am I better using an umbrella company or setting myself up as a Company?

Apologies if this is a silly question but this is all new to me!

Regards

DTD

[Cirrus]

Ltd company is much better. Your difficulty is what your customer thinks about this. It's their call.

[northernladuk]

Ltd company is much better. Your difficulty is what your customer thinks about this. It's their call.

It depends on his expenses really but I thought there was a cap at around 30k where umbrella was a better bet below this and ltd better above.

[davethedog]

Thanks for the replies and would only be looking to work 1 or days per month to start with (if that).

DTD

[eek]

If you are being employed directly rather than via an agency, just bill them directly and treat yourself as self - employed.

yes you will need to fill in a tax return but there are online banks now (search for coconut, not used just saw ads) that will do all that for you including helping you create the invoice.

a limited company or an umbrella may be too much for what is just a small sideline business unless agencies are recruiting you in which case you will have to

[mudskipper]

I agree with eek - you'll struggle to find an umbrella who will take you on for 1 day a month, and the costs/hassle of running a ltd really won't be worth it.

Invoice directly as yourself, and declare the income on your tax return.

[davethedog]

Thanks all and wanted to avoid self assessment tax return if possible, will that change anything?

[eek]

Thanks all and wanted to avoid self assessment tax return if possible, will that change anything?

Self assessment is very straightforward provided you use Quickbooks or one of the bank accounts I mentioned above.

Being honest all the other options would be more work they just look less scary because you don't know whats entailed.

Both an Umbrella or a Limited Company is going to cost you a £1000 or so a year to run, few accountants will charge that for a simple self assessment form and you could easily do it yourself.

[wattaj]

Thanks all and wanted to avoid self assessment tax return if possible, will that change anything?

Freeagent will do your self assessment for you. It's almost free with a RBS business account (circa £5 pcm exc. transaction charges). I'd recommend a separate account for any self-employed income abyway as it keeps things nice and clean.