Limited intentions!

Posted on: Thu, 06/11/2008 - 17:15
Limited intentions!

I'm not at all sure where this fits, or even whether!

I'm about to retire from working as a Technical Author. The Company I currently work for want me to be available to come in and do ad hoc work for them. I have no intention of working regularly, or for anyone other than this Company.

I COULD simply work on the same salary basis as I now have (although pro rata of course) but, as a bona fide 'Contractor', I COULD be paid about twice as much. The problem is I have no idea how to become a 'Contractor'. Is that what a 'sole trader'could be construed as?

There is no point in my becoming a Company - certainly not a limited company, since I will not be working regularly, will not be employing anyone else or working for anyone else, and there will be no debts to incur.

Anyone have any ideas as to my best course? Any help would be better than the zilch ideas I have now!

Regards

peterN


Posted on: Mon, 10/11/2008 - 16:25 #1
Be careful

Hi Peter,

There are two issues here.

When you're in business, you can be a sole trader (if you're on your own), partnership (if you're in business with someone else), or limited company. So yes, if you become an independent contractor, and don't have a business partner or form a limited company, you would be a sole trader. You would have to register with HM Revenue as self-employed and file a Tax Return every year.

BUT you would need to be careful that, as an independent contractor, you do not simply continue working for your former employer on the same terms. The Revenue could then deem you to be still an employee and demand payment of employer's NIC from your former employer.

I hope that helps,

M
(a chartered accountant)

Emily Coltman MA ACA
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