IT Contractors – How do you get paid?

Hi

I am having to become a contractor again.

My understanding is a ltd company is still the best way to get paid etc esp with the changes in the last budget, compared to a payroll/umbrella company.

Is that still the case? Can anyone give me an indication of accountancy admin costs and recommend me an acountancy firm.

I may end up doing the admin myself but interested in what options there are around these days.

Thanks in Advance

Are you confident you can find work? It’s not a particularly appealing market at the moment and rates are right down.

A – Ltd Co and pay accountant (600-1000 a year say)
B – Umbrella – Parasol It were good (70 ish a month unless they have gone % like most others)

sorry

Iain Lindsey, co Arthur Daniels and Co, Fareham (google)

Mrdomino is an IT contractor with a limited company, he uses Nixon Williams for his accounting and he has recommended them to friends http://www.nixonwilliams.com/

I use Brookson[/url]. They charge me about £120 per month and do absolutely everything. All I need to do is tell them the hours I work and any incurred expenses; they tell me what I can take in directors fees, dividends and expenses. They also sort out the corporation tax PAYE/NI etc.

ok thanks for the advice

Cheers

I also found Parasol to be pretty good as an umbrella company.

try contractoruk.com. they list a few accountants and have really good help as well as a forum.

Another vote for Parasol.

another vote for parasol, they charge about 70/80 for month and do everything. If you join let me know, I think there is a referal reward of an ipod or something, for existing users. ;o)

I don’t at the moment. Credit crunch and all that.

But when I do, yet another Parasol user. Quick and hassle free.

I would personally avoid any umbrella or any organisation which directs the way your business is run like the plague at the moment. The HMRC are gunning for people who use them. The managed service company legislation introduced a couple of years back is preparing the way for large scale capture of people employed by them. If it were me, i’d either go PAYE or set up a limited company, and do it properly, getting decent contract reviews (not Brookson type compliance reviews) making sure that your actual working practices reflect working as a company. It’s a fair bit of work, but (IMHO) it’s by far the safest way of working, unless you like paying tax and the penalties which can now follow.

The convenient nature of Parasol and Brookson is (again IMHO) a very dangerous thing as it gives a false sense of security and makes people drop their guard. In truth though, it’s a serious issue, and I would research and take professional advice, or just go PAYE.

I agree with Iodious. If you have a look at the new p35 and SA forms that were bought in last year you will see how things are heading with specific questions about if you are a service company or provide services and how much of your income was from a company providing services etc. Only last year as there was some confusion over the wording the questions were ignored by hmrc, however this year they will definately be used, so be aware. It looks like the days of being one man limited companies for IT contracting are coming to an end.

Work through a company called Peak Performance. Officially PAYE getting paid minimum wage then 10 times a year I receive an employee benefit trust seems pretty safe from the taxman, they tried to prosecute the phones4u guy a couple of years back and got nowhere!Compared to the guys who are Ltd company I come out with the same as them. No hassles with keeping receipts or doing tax returns.

I used greenlantern35.co.uk as my umbrella company. Very good & helpful, I’d recommend them.

giant_scum, is that the route where the trustees give you a loan every now and again, which you never pay back? I thought that had been closed down?

Limited company here. By the way, are you able to diversify companies- just been thinking whether it would be possible to buy a holiday home somewhere, income generating of course.

vinnyeh thats the one and not been closed down as I received my latest loan 6 days ago!

defineatly going the ltd company route.

still undecided, my usual accountant has peed me off by quoting 300 setup and 200 pcm which i think is a little excessive.

i was about to go with sjd through the pcg but then a collegue warned me off.

thanks for the replies.