Software developer contractor

quickshot89 · 8 Jan 2013 at 10:42

What sort of software are we talking about here? I did an industrial placement 18 months ago where I pretty much learned F77 but with it being an old language now im guessing its only maintaince roles that would be needed in the larger older engineering firms?

jonneymendoza · 8 Jan 2013 at 11:09

Lucero said:
Seriously? You're even more deluded than I first thought. You need a pension, full stop. Property is now unreliable. It's better to have many pots or one very good large one. I've worked for the last 4 years on a AVC scheme which is matched by my employer. Within that time, my pension pot is already over £50k. Nowhere near enough to live on at retirement, but then I have another 25-30 years of work left. I also have two stakeholder pensions which I've had running for the last 10 years. Then there's the ever awesome state pension

hold your horses man lol ok sir i will get pension

Amleto · 8 Jan 2013 at 11:19

quickshot89 said:
What sort of software are we talking about here? I did an industrial placement 18 months ago where I pretty much learned F77 but with it being an old language now im guessing its only maintaince roles that would be needed in the larger older engineering firms?

There are lots of software languages, but nobody (sane) is going to pay for a contractor that has 'industrial placement' as their only experience.

quickshot89 · 8 Jan 2013 at 11:35

Amleto said:
There are lots of software languages, but nobody (sane) is going to pay for a contractor that has 'industrial placement' as their only experience.

Oh I know, I was only curious, will need to work in a perm position for a few years before id consider going temp.

Amleto · 8 Jan 2013 at 11:41

The most popular languages are C#, Java, C++ and python. There are some websites that give you the stats...

agent_paul · 8 Jan 2013 at 12:06

Amleto said:
The most popular languages are C#, Java, C++ and python. There are some websites that give you the stats...

an example of one site: http://www.itjobswatch.co.uk/

Bear · 8 Jan 2013 at 12:20

MilanoChris said:
Also, just read the whole thread. I have been warned about taking dividends on a regular (eg monthly) basis, as this can be seen as taking a 'wage' by HMRC (think IR35!). I've been told to take irregular amounts at irregular intervals.

I will of course seek the advice of my accountant when I get it set up finally and I would strongly urge those contractors in this thread to do the same. Of course I could be wrong, however this is the advice of around 12 IT contractors I've met over the years since 2008 (the year I decided contracting is for me).

Sorry but this is wrong, dividend issue frequency has nothing to do with IR35 what so ever. There is nothing in law that prevents a company paying dividends when ever it wants or how much so long as the dividends are out of retained profits after all deductions.

What is important is to understand what IR35 actually means and ensure that your working practices means you aren't caught by IR35 which can be tough as clients don't necessarily understand nor care about IR35 and try to treat you like an employee.

jonneymendoza · 8 Jan 2013 at 12:37

Bear said:
Sorry but this is wrong, dividend issue frequency has nothing to do with IR35 what so ever. There is nothing in law that prevents a company paying dividends when ever it wants or how much so long as the dividends are out of retained profits after all deductions.

What is important is to understand what IR35 actually means and ensure that your working practices means you aren't caught by IR35 which can be tough as clients don't necessarily understand nor care about IR35 and try to treat you like an employee.

Just dont go to any company events and take out a pension/child/health care from them and your golden

Bear · 8 Jan 2013 at 12:58

jonneymendoza said:
Just dont go to any company events and take out a pension/child/health care from them and your golden

Im guessing that you are joking, but if you aren't then there is a hell of a lot more to it than that.

dowie · 8 Jan 2013 at 13:09

JonNorris said:
Like any firm our accountants vary in qualifications; we have a handful of AAT apprentices, some part-qualified accountants, all the way up to our Chief Accountant who worked for HMRC for 20 years. We're accredited by the PCG, AAT and soon the ACCA, so we're beholden to certain standard of training and customer care.

And soon? so not yet....

Just out of interest how many actual Chartered Accountants (whether CA, ACA or ACCA) do you employ? If I were reading into your post in a cynical manner then it would seem you've got a ex tax man some a-level school leavers with AAT quals and a few part qualified guys?

Just playing devils advocate as your post did seem to skirt around the issue and the other poster made the accusation that you aren't [chartered] accountants?

ChrisD. · 8 Jan 2013 at 13:36

Bear said:
Sorry but this is wrong, dividend issue frequency has nothing to do with IR35 what so ever. There is nothing in law that prevents a company paying dividends when ever it wants or how much so long as the dividends are out of retained profits after all deductions.

What is important is to understand what IR35 actually means and ensure that your working practices means you aren't caught by IR35 which can be tough as clients don't necessarily understand nor care about IR35 and try to treat you like an employee.

Thanks for the info. Like I said, I'll be talking about it all with my accountant (when I get one, which brings me back to my question at the start of this page) and be taking his advice. It's all new to me, so only posting what I've been told/believed to be true.

alx · 8 Jan 2013 at 13:46

MilanoChris said:
Thanks for the info. Like I said, I'll be talking about it all with my accountant (when I get one, which brings me back to my question at the start of this page) and be taking his advice. It's all new to me, so only posting what I've been told/believed to be true.

It may be that taking regular dividends means that you're more likely to be looked into by HMRC (just an educated guess) and in turn they may find evidence to suggest you come under IR35. As Bear says you will not come under IR35 just because you take regular dividends.

Pudney · 8 Jan 2013 at 13:48

MilanoChris said:
I paid SJD and they created it for me. I know it can be done yourself but you can claim it as an expense

Not for corporation tax you can't. Well you can, but it'd be wrong.

ChrisD. · 8 Jan 2013 at 13:48

alx said:
It may be that taking regular dividends means that you're more likely to be looked into by HMRC (just an educated guess) and in turn they may find evidence to suggest you come under IR35. As Bear says you will not come under IR35 just because you take regular dividends.

Thanks for clarification.

What about this?

MilanoChris said:
Starting my first contract either on the 21st or up to 4 weeks from yesterday, depending on how fast I can get out of my current job (leaving the Army).

I have my ltd company set up, I'm VAT registered, I have a business account etc. I was going to take the liability insurance just before I start.

My question:

Get an accountant now, or wait till I know the start date? I'm going with SJD.

ChrisD. · 8 Jan 2013 at 13:51

Pudney said:
Not for corporation tax you can't. Well you can, but it'd be wrong.

Was just going off the info here:

http://www.sjdaccountancy.com/about/resources/limited_company_formation.html

Particularly:

And, company formations can be claimed back as an expense.

Pudney · 8 Jan 2013 at 13:52

Bear said:
Sorry but this is wrong, dividend issue frequency has nothing to do with IR35 what so ever. There is nothing in law that prevents a company paying dividends when ever it wants or how much so long as the dividends are out of retained profits after all deductions.

Actually that's not true, in the tax world if the nature of a transaction doesn't conform to its legal definition then the legal structure can be ignored. Whether this is the same for dividends I can't guarantee, but to state that it says nothing in legislation so therefore can't be true would be to hugely underestimate what can be done by HMRC.

Pudney · 8 Jan 2013 at 13:53

MilanoChris said:
Was just going off the info here:

http://www.sjdaccountancy.com/about/resources/limited_company_formation.html

Particularly:

It can be an accounting expense, the formation of a company is capital in nature and not tax deductible for corporation tax.

oulton · 8 Jan 2013 at 13:55

I have been contracting for 6 months and so far so good! A much better deal for me on balance than being an employee. I am registered with an accountant, but we haven't met yet as I do most of the admin myself (paying vat quarterly, using the payroll etc) and they just need to help me publish my accounts at the end of my tax year.

ChrisD. · 8 Jan 2013 at 13:55

Pudney said:
It can be an accounting expense, the formation of a company is capital in nature and not tax deductible for corporation tax.

I've got to be honest, I don't know the difference. As I've said, I'll put it all to my accountant when I get one and I'm sure he'll do whatever is correct.

Pudney · 8 Jan 2013 at 13:57

MilanoChris said:
I've got to be honest, I don't know the difference. As I've said, I'll put it all to my accountant when I get one and I'm sure he'll do whatever is correct.

To be honest with you, most small firms would probably not worry too much and deduct it from tax profits as it's generally not huge amounts which HMRC wouldn't notice or worry about.

It is wrong but if they're worth the fees you pay them they should definitely tell you what "risky" things they have done as you will be relying on them and it will be you that HMRC will penalise if things go wrong.