If you are moving from a role as a permanent employee to working through your own limited company as a contractor, consultant, or freelancer, then you may have become accustomed to receiving certain benefits in kind: company car, private health insurance, subsidised gym memberships etc.
You will have been taxed for all of these benefits in kind, most likely by a change to your tax code, and when working as an employee the benefits can be worth the taxes that you pay on them.
However, when working through a limited company that you own, if you pay such benefits to yourself as an employee of the company not only would you have to meet the personal taxes but also the employer’s national insurance amount of 13.8% of the benefit. This means that in the vast majority of cases it is not worth having these benefits through the company as you have to meet the tax burden from both sides.
There are, however, some income protection type policies that name the company as the beneficiary and exist to protect the company’s income source in the event of key personnel not being able to work for a period of time. These policies are valid company expenses and will not incur benefit in kind taxes.
Integro Accounting cannot advise on different insurance policies but we have partnered with a market leading firm of specialist financial advisers who share Integro Accounting’s values; striving to go the extra mile for clients at all times.
If you would like to explore this area further please to get in touch and we can arrange a free initial consultation for you with an adviser who will take the time to get to know you, your company and your goals. Contact us.
Why Integro Accounting?
Integro Accounting is the UK’s only specialist provider of fixed fee, limited company accountancy services for contractors, consultants and freelancers that was established to an award winning standard – our Practice Manager, Maria Hickmott FCCA, won The British Accountancy Awards’ ‘Accountant of the Year’ in 2011.
We were set up with the vision of providing a service that is the ultimate for the dynamic, busy professional of today in a language you understand.
Integro Accounting have designed a bespoke service for the contractor who is always on the go; never forgetting that one size will never fit all.
The relationship you have with your accountant is the most important factor in our service which is why we will always offer unlimited contact with your own personal accountant; whether that contact is via the phone, email or face to face.
We have our 3 offices located in London, the South-West and on the Bedfordshire and Buckinghamshire border. There are also meeting locations in many of the major cities and towns across the Home counties, South-West and South Wales, all conveniently placed so that you never have to travel far to meet your accountant.
If you have any questions about contracting or would like to find out more about how Integro Accounting can help you and business please call Christian on 01525 303984, email firstname.lastname@example.org or request a callback.