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What do we want? A proper review of IR35! When do we want it? Last year! Bunch of IT contractors protest outside UK Parliament

Anonymous Coward
Anonymous Coward

Corporation tax isnt my field. Your right about the rates but the important part is *profit*. Pretty much anything you can think of can be deducted by a competent* accountant to reduce those profits. Loss relief, carrying it back etc is always a good one. Plus you get goodwill, depreciation of assets, losses to write off and so on.

* Good luck getting one of them, about 1/3 k speak to are worth the time of day.

So personal tax 101.

It's my job, so this is the legit lowdown

The trick is to pay yourself exactly the lower earnings limit for National Insurance through PAYE, and take the rest as dividends. At the lower earning level, your employer and you pay a % on income over it. How much is 12% of £0.00 again?

Tax gets more fun. You have the personal allowance, roughly £4,500 is unused, then you get the dividend allowance on top. You draw the profits out the business as dividends, at a 7.5% rate. This is far cheaper than tax and NI through PAYE. If it wasn't, you would be a sole trader (or if your smart a LLP).

Even though you paid £0.00 in contributions, as you have made the LEL each week you qualify for the benefits that come from NI. The company that pays you is responsible for paying your entitlements, such as SSP, holiday pay etc. Its your company. If your refusing to pay yourself then you are ripping yourself off. If that doesn't sound daft than I have a bridge to sell you in Middlesbrough. If your employer can't afford SSP, they can claim help through PAYE, or send you to the dole office with a SSP1. Either way, you have those rights, and your dodging tax by bending the law into a pretzel, while denying yourself employment rights you are responsible for making sure you get.

All this to help some multinational shave 1% off its pay bill. This is just like uber, deliveroo, hermes, and and there "self employed" staff, Lorraine Kelly and her career acting as, errrr Lorraine Kelly, and so on. Just like all those people who paid themselves via a "loan" that was never collected, such as, Glasgow Rangers.

Franz Kafka would be proud.

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