SE Contractor to Permanent (1 Viewer)

tehNellie

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Sooo, with all the IR35 gubbins happening recently I took the plunge and set up my own company while I contract.

With the inevitable sense of timing I received a call regarding a permanent job within the pay range that pre-company I would have considered immediately (from a contract point of view, I'm not one of these £60ph guys as some of my advice probably confirms ;)).

The pay range for the permanent role is around the net rate I take in as a contractor but I'll obviously be paying more tax through PAYE and there's the small matter that I can't wind up the company for another 11 months.

So bearing in mind this is an internet forum and I'm accepting this isn't professionally offered advice, can anyone give me an indication about
a) what sort of cost it's going to incur to keep a ltd company, bringing in no income, going for 10-11 months.

or

b) What amount, if you're a contractor, that you'd look to make over your current hourly rate to make it worth while moving to a permanent role when you've got the baggage of a ltd company.
 

neileg

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Actually, having a company brings you into IR35. Being a self employed contractor leaves all the employment status risk with your client (which is why they often refuse to consider anyone not using a company).

You can wind a company up at any time. If the company hasn't actually done anything, known technically as dormant, then you need to do nothing. Eventually Companies House will write to you. Ignore them. They will write again. Ignore them. Finally, they will write and say that if you don't file all the outstanding returns, the company will be struck off. Ignore this. The company gets struck off. Cost to you £0. Effort on your part, just holding your nerve!

If the company has traded, you will need to file the appropriate returns with HMRC for Corporation Tax, PAYE, VAT etc. Pay off any creditors in full. File accounts with Companies House for the period from formation to the first accounting reference date. Then flip into ignore mode until they strike off the company.

As you suggest, this information is offered without liability for the completeness or accuracy of its content or the consequences of relying on this information.

(I'm a chartered accountant, by the way)
 

tehNellie

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Thanks for the advice on that Neil, and apologies for not responding sooner, the joys of getting ready for a sarbanes oxley audit when you have a database system like this one ;).

I never did take the permanent job and things have since looked up on the contract front so I'm in not currently considering jumping back into permanent role.
 

Darth Vodka

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correct me if i'm wrong... but my understanding was if you set up a company, you can then either use it or not

in fact, you could take a permanent job and use the company to go contracting at (say) weekends (as long as your perm contract/boss allows this)
 

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