At Clearways Accountants we have been contacted by a nurse working through an agency for one or two days a week (five days a month) asking whether he should work through a limited company. It’s a great question!
As a nurse, our limited company package, excluding VAT is charged at £75 (plus VAT) per month. With a limited company you get all the advantages of working through your own company:
- control over your invoicing;
- expenses (travel, lunches, training, books and subscriptions, etc) can be claimed against your income before tax;
- control over how you take the money out of the company (salary and dividends);
- a more tax efficient structure.
Operating a company needs organisation and so for a few days each month some nurses have been using an umbrella but have then be stunned at the deductions taken by that umbrella company.
Not only will tax and national insurance (employers’ and employee’s) be deducted by the umbrella company but we have heard of charges of £15 (plus VAT) per day worked. Over five days a month this totals £75 (plus VAT).
If this is your situation you should either:
- set up your own limited company;
- find a cheaper more cost effective umbrella company;
- or go on bank (when you will not pay processing costs nor employers’ national insurance).
Please contact Clearways Accountants using the contact form below or on 01737 244298 if you need help deciding how you should work extra shifts.