The Comprehensive Service

Transcription

1 The Comprehensive Service At PML Accounting Limited, we understand that business affairs need to be dealt with efficiently and effectively, so we have developed a specialist accounting service specifically tailored for agency workers and contractors. PML deals with the difficulties that contractors face in forming and operating Limited Companies. PML Accounting takes care of payments which need to be made on behalf of the Company and the returns which need to be submitted to the relevant statutory and taxation authorities. These services include: Maintaining accurate records in compliance with the companies act. Preparing annual statutory accounts and dealing with Company annual returns. Calculating and payment of Income Tax and National Insurance contributions. Completing annual company returns. Preparation of Corporation Tax computations and returns Preparation and submission to the Inland Revenue of relevant P35/P60 annual returns and P9 and P11D expense returns. PML assist in forming a Limited Company for each Agency Worker / Contractor Client. The Company bears the client s chosen preferred name e.g. John Smith Driving Services Limited; such that each Agency Worker / Contractor Client has their own Limited Company. Each Agency Worker / Contractor Client becomes a director of their own Company, holding 1 x 1.00 ordinary shares. The Agency or Business will be informed that PML Accounting will be administering the Company. All the necessary documentation will be completed and confirmation of the Limited Company status will be provided to the Agency or Business. PML provides a comprehensive service for a four weekly fixed fee arrangement which is payable whilst the contract is ongoing. Contributions towards fees are deducted weekly when trading is conducted on a weekly basis. Standard service applicable to all contracts: Calculation and reimbursement of qualifying travel expenses, Preparation of annual statutory accounts for submission to Companies House, Preparation of Corporation Tax returns and computations for submission to the Inland Revenue Sales invoicing to the Recruitment Agency or Business, Free Company formation, Credit control collecting payments for invoices issued by each Company, Advice on mortgage applications, life insurance and pensions, Claiming tax allowable expenses where applicable for example: o Motor expenses (using Inland Revenue published mileage rates), o Travel and subsistence expenses, o Use of other business equipment, o Training costs, o Postage and stationery o Use of personal computers.

2 Accountancy Service overview How the service works A Limited Company is set up on behalf of the Agency worker / Contractor and that person then becomes a director of their own Company. Income is generated from the Company by weekly or monthly salary and a dividend payment as a shareholder. The benefits from the service Because dividend payments are not subject to National Insurance contributions, the spendable income can be as much as 10% higher than that of a salary paid under PAYE, and this can be exceeded by claiming allowable expenses. In the case of Contractors whose Companies work in the construction industry, CIS tax of 20% is deducted from the income of their Company and this amount will cover the NIC due on the salary and Corporation tax liabilities. All administration matters relating to the Company will by undertaken by PML and annual returns will be completed and submitted to Companies House. Business expenses All business expenses (i.e. motor mileage) which are able to be claimed against taxable income will be claimed by PML on receipt of a completed Expense Claim Form with supporting receipts or relevant documentation. How payment is made A timesheet detailing hours worked on a weekly or monthly basis (depending on the schedule chosen) is forwarded to PML and to the client (Agency or Business). As soon as this is received, PML will raise an invoice from the Company to the client so that payment may be made to the Company account Terminating the PML service If any Client wishes to terminate PML s services, the Agency or business customer and PML must be informed. A P45 will then be issued and the company will cease trading. If however, the Client wishes to continue trading via their company without the assistance of PML, there will be a charge to cover the costs of forming the company. Furthermore, we will also charge up to the balance of fees due in the year for any additional work required in relation to ensuring compliance with the company s statutory obligations (any additional charge will be subject to VAT at the current rate).

3 Our Strategy for Success PML Accounting Limited prides itself on the services provided to all Limited Company Contractors and is recognised by Agencies and other Businesses for the quality of that service. It is recognised that we provide a fast and efficient service, which is tax efficient and financially beneficial. We specialise in setting up limited companies and ensure they operate within the UK Company and Tax Laws. In this scenario, Independent Contractors will pay less tax by taking advantage of the savings available. Utilising your own Limited Company, a Director can enjoy the advantages of having a Limited Company status, PML will assist in administration and legal requirements. Net pay can be substantially increased over the alternative PAYE arrangement, provided the contract and the characteristics of the engagement are capable of passing the self employment test. When operating as a Limited Company, the Contractor is able to take part of the income as salary, which is subject to Income Tax and National Insurance contributions and the remainder as dividends. Income is therefore, allocated in the most tax efficient way, utilising all the tax allowances that are available. Limited Company contractors are entitled to tax relief on certain expenses, for instance: Motor expenses (mileage rates), Subscriptions, Computer equipment and software, Telephone (Inc mobile), Pension contributions, Postage and stationery, Training costs, Travel and subsistence, Company secretarial costs, Accommodation, Accountancy costs, Protective clothing, All Income Tax and National Insurance liabilities will be kept up to date and the entitlement to a full state pension will be maintained. Another benefit of PML Accounting Limited helping with the administration of your Company is on hand advice with regard to Pensions, Life Insurance and Mortgage applications through an associated company. The PML total support and administration service package equates to only plus VAT per four week period, assuming a yearly relationship, which for the service provided is the lowest on the market and has been for several years.

4 Frequently asked questions Q. On what basis does the service work? A. An Agency Worker or Contractor becomes a Director of their own Limited Company providing services on a contract basis to various organisations. PML will set up and administer the Company, filing all returns and ensuring all legal obligations are fulfilled. If required by the company, PML will assist in a non-executive role with some of the administration duties of the company, such as payroll which will ensure that all income tax and national insurance contributions are paid. Q. How does the Agency Worker / Contractor benefit? A. The tax efficient nature of the service enables the maximum proportion of gross earnings to be received as net income. This income comprises a combination of weekly PAYE salary and shareholder s dividend. Dividend payments attract a lower rate of tax and are not subject to National Insurance contribution. Therefore, the net income is higher than that received under the traditional PAYE system. Q. What about the Construction Industry Scheme (CIS) relating only to Contractors working in the construction industry? A. To comply with Inland Revenue legislation PML, will oversee the deduction of CIS tax of 20% from the gross invoice total if the Limited Company being administered for a contractor is working within the construction industry. All companies trading in the construction industry are registered and issued with their own official Construction Industry Scheme Registration number. Q. What does the service cost? A. PML Accounting fees are plus VAT per four week period i.e plus VAT per week, based on a yearly relationship.(fees relative to other periods of relationship are discretional please inquire for details) Combined with the package we offer this is excellent value and we believe the service to be the most competitive available in the market today and this, for the service we provide has been the case now for several years. Q. Is a Contractor entitled to Sick Pay? A. Yes, all working individuals are entitled to SSP when certified sick. Q. Is a Contractor entitled to Holiday Pay? A. Yes, currently under EEC guidelines workers are entitled to 28 days paid holiday per year. The Agency or Company using the service of the Limited Company engaging the Contractor, are required to include the holiday entitlement as part of the gross invoice amount paid to the personal service company. The director/contractor decides whether payment for holiday is paid weekly as part of the hourly rate or reserved to be paid when holidays are taken. Q. What about working with different clients at the same time? A. All that is necessary is that PML are advised of the new client details and the clients are informed that invoices will be raised through the contractor s own Limited Company and PML will be administrating the company on behalf of the contractor. PML will do the rest.

5 Q. What happens if Limited Company agency worker changes client? A. No problem. Let us know the new client details and we will do the rest. This facility is fully transferable to different clients at no additional cost to the contractor s Limited Company. Q. I am new to contracting and I do not even have a company set up A. We offer a FREE Limited Company to all new contractors who use our services. Q. I live 125 miles away from a PML office, am I too far away? A. No, we offer a nationwide service to Limited Company contractors. All of our work can be carried out at our offices using fax, postal service and . Q. What happens if I need help? A. You may , telephone, fax or write with any query, we will respond as soon as we can, usually the same day. Q. Will I need an audit? A. Limited companies with an annual turnover below 6.5 Million do not need to have an audit. Q. How much notice must I give if I want to stop using your services? A. In the unlikely event of you wishing to stop using our service, all we would require is one month s notice, in order that we may carry out the necessary termination / transfer administration work. Q. How quickly can I start to use PML accounting as my Accountants and Tax Advisers? A. Simply return the forms (or a copy) enclosed with this pack. As soon as we receive the completed forms, we will set your company up and contact you for anything further that we may need. Q. What do I do if I have any further queries? A. You may contact the PML office by any one of the following: Telephone: Fax: info@pmlaccounting.co.uk Visit the Website at Or please write to us and we will respond by return.

6 PML Personal Illustration Contractor A Pay Rates: 400 per week Expenses: Based on 250 miles per week and additional expenses. Mileage rate is 45p for first 10,000 miles AS AN EMPLOYEE (PAYE assuming Tax Code 747L) Gross pay Tax ( 51.25) NIC ( 31.32) Net pay VIA YOUR OWN LIMITED COMPANY Gross pay (invoiced to client) Less: Administration fee ( 21.60) Employees NI ( 00.18) Corporation Tax ( 00.68) Net pay Represented by: Salary net: Expenses Net payment 2.72 Total Net Payment Total Benefit 60.11

7 PML Personal Illustration Contractor B Pay Rates: 500 per week Expenses: Based on 250 miles per week and additional expenses. Mileage rate is 45p for first 10,000 miles AS AN EMPLOYEE (PAYE assuming Tax Code 747L) Gross pay Tax ( 71.25) NIC ( 43.32) Net pay VIA YOUR OWN LIMITED COMPANY Gross pay (invoiced to client) Less: Administration fee ( 21.60) Employees NI ( 00.18) Corporation Tax ( 20.68) Net pay Represented by: Salary net: Expenses Net payment Total Net Payment Total Benefit 72.11

8 PML Personal Illustration Contractor C Pay Rates: 600 per week Expenses: Based on 250 miles per week and additional expenses. Mileage rate is 45p for first 10,000 miles AS AN EMPLOYEE (PAYE assuming Tax Code 747L) Gross pay Tax ( 91.25) NIC ( 55.32) Net pay VIA YOUR OWN LIMITED COMPANY Gross pay (invoiced to client) Less: Administration fee ( 21.60) Employees NI ( 00.18) Corporation Tax ( 40.68) Net pay Represented by: Salary net: Expenses Net payment Total Net Payment Total Benefit 84.11