Contracting

woody

Hi Guys,

I have started contracting with IT Alliance.

Now I am setup for the first three months as a Sole trader and then they advise me to setup as a Limited company.

Now I am only going to be doing contracting about 6 months at most.

Would there be any point in setting up a limited company and if so can anyone recommend any books ?? or sites I can read up over the coming weeks.

It is all new to me, also has anyone dealings with the above recruitement agency and are they okay.

any help on the in's and out of this would be much appreicated and also any names or sites of companies that setup a ltd company for you or act as an umberalla company...

thanks

elivsvonchiaing

Imho stick to being a sole trader for as long as you can get away with it. Just make sure you register for VAT before you hit the threshold (no idea what is in Euro these days).

A limited company will create an awful lot of extra paperwork for you and increase your accountants fees. E.g. You have to keep employee records for yourself. You need a payroll system for yourself - need I go on?

Just put yourself across as an honest John and you should be OK. They want you Limited so if you fcuk off to Australia without paying any tax - they don't carry the can.

After six months if they are insisting on Ltd - try anything to get out of it - e.g. suggest they take withholding tax - can't think they'd be interested in the paperwork though - you probably need to give thought to this to get a strategy that'll work.

RicardoSmith

All the contracts I've done the agencies have insisted that I either set up a limited company or go through a unbrella limited company. Are they advising or insisting?

elivsvonchiaing

Sounds like you've got away with it so far - so I would say they are advising for their benefit. There is the nervousness re: OZ, NZ etc.

Unless you play solitaire all day and have a team in Lahore doing your job - a limited company only serves the agency. Tax man - just as happy - accountant - same unless he needs the work.

Where they are coming from is TAX related - they are potentially liable if you don't pay any tax - It might just be easier to setup an off-shore arrangement - (their auditors won't settle for sole traders - NEVER! offshore pas de probleme ) just don't end up like Redmond

Basically the tax guidance laws are indeed bull**** (when applied to people who have to go to their partner, parent, best-mate etc. to sign as company sectretaty when they really are just a one man band - this **** just sucks). Whatever you do just avoid paying more by being forced into the Ltd scenario.

If you do end up with this liability and continue to contract as a limited company for many years- sell any property you own ( early Summer probably best). Screw em by owing at least 50k and fcukcing off abroad - Outside EU safe for next 20 years at very least. This screws just Charlie McC and not the agency - Hence their desire to make you Ltd.

woody

Thanks guys there advising, TBH I am not going to set one up to much hassle.

The one thing that is putting me off, is that they say invoice every 4 weeks and you get paid 10 to 14 days later.

bollox to that, I will invoice them every week !!, it does'nt take that long to pay money into the bank and if necessary I will turn up at there office and get a cheque every week if necessary!

RicardoSmith

Unfortunately my experience of most agencies is that they take an age to pay. Sometimes as much as 2 weeks late.

elivsvonchiaing

All you need is one timesheet to go missing (in Park House) and you could be looking at a month

halkar

Not worth setting up Ltd for 6 months unless you consider still contracting after that otherwise just tell them you have applied and not heard anything. You probably finish your contract this way as unless you are buying of the shelf it can take months to setup ltd company and your bank accounts etc.
As for the pay, 2 weeks is not bad considering with some agencies it can take up to 4 weeks after invoicing.

All the best :cool:

woody

I am going to put it on the long finger....LTD that is...

In regard to doing accountancy etc... just realised my sister is a good book-keeper

Kernel32

Setting up and runnin a LTD isn't as difficult as some people think. An accountant will normally handle everything for you except keeping track of your time and sending your invoice.

For just 6 months though its not worth it unless you are making 350+ a day. Not only would you have to pay to do the setup and running but you have to pay to do a wrap up, get the company struck off etc when you are all done.