PAYE v Ltd

Forming and administering your own limited company can be a very time-consuming and potentially, in some case, a confusing exercise.

A limited company in the United Kingdom is a corporation whose liability is limited by shares (Ltd). This is the most common form of privately held company. By setting up your own limited company, you become a Director who is responsible for the affairs of that company.

Benefits

  • The most tax efficient way of working providing your contract is outside IR35
  • You are your own boss and have complete control over the company and its operations
  • A wider range of tax benefits are available; including payment by dividends; that attract a lower rate of tax


Cons

  • You are responsible for maintaining accurate company accounts
  • You are responsible for ensuring compliance with all company matters
  • You will be responsible for invoicing the client, all aspects of credit control and maintaining an accurate accounting system
  • You must ensure that all company returns and accounts are filed by their respective due dates. Failure to do so, may give rise to late filing penalties being born against the company
  • You will need to employ the services of a reliable accountant
  • You will have to maintain various comprehensive Insurance Policies e.g. Employers Liability, Public Liability and
  • Professional Indemnity Insurance
  • You will need to complete a self assessment for tax each year, getting this wrong can prove detrimental to your tax status in the long run


Umbrella Company

Our umbrella service gives its members the ability to benefit from being legally tax-efficient, without having to worry about their IR35 status.

Many of the tax efficiencies you will receive working with Maddison Group come from the genuine business expenses allowances that can be offset against tax which are directly negotiated with and agreed by HM Revenue and Customs (HMRC).

The mechanism that allows this to be organised on your behalf occurs as we are not obliged to report every single detail of an expense claim (travel, subsistence, etc.) on a tax return and can "dispense" with much of the paperwork, hence "dispensations".

Click here to find out more about our Umbrella service