Sticky Situation - Self Employed / Contract worker

kitchpoo

This may have been better placed in the financial planning section but it falls between here and there...... here goes....

On 26th September 08 I commenced work as a contractor - working for my own Ltd co. - so where I work pays an agency - the agency then pays my company - and I pay myself from that - On an 11 month (rolling) contract.

I was informed that my last day of work will now be 14th Aug - JUST short of the first full 11 months!

I took out a policy which will cover the monthly mortgage after 30 days if certain criteria are met.... ie - the company is placed on hold/ceases trading (or words to that effect) and I am actively registered as seeking employment - as long as the reason for the company ceasing is not an end of contract.

I also do Mystery Shopping to up the income - so my Ltd Co. is also gaining £200 pcm from these assignments.

Do you think I will have an issue with this considering where the break in employment is coming. And is there a problem in ceasing trading as there are not enough funds to pay me as an individual from income from the Ltd co.?

Obviously I am doing all I can to work around this situation and walk in to some work, but that is proving slightly difficult at the moment.

lots of questions - sorry but just a few issues which are preventing sleep at the moment.

Debt_Free_Chick

kitchpoo wrote: »

I took out a policy which will cover the monthly mortgage after 30 days if certain criteria are met.... ie - the company is placed on hold/ceases trading (or words to that effect) and I am actively registered as seeking employment - as long as the reason for the company ceasing is not an end of contract.

Ignoring the mystery shopping for a moment .... unless you get another contract, surely your company will cease to trade due to the ending of the (current) contract ....?

I also do Mystery Shopping to up the income - so my Ltd Co. is also gaining £200 pcm from these assignments.

I can't see that the MS is anything to do with the company - unless the company's business is MS. What is the purpose of the company? If it's not MS then you shouldn't put MS through the company. The MS should be a separate additional self-employed business that you run alongside - and not part of - the company.

Each business should be accounted for separately and you should complete a self-employment appendix for the MS on your tax return.

kitchpoo

I've got the MS'ing lumped in to the one company for IR35 reasons, if my contract did not cease, and I was re-hired in effect the inland Revenue could have imposed IR35 quite easily as it would appear I had only one continious employer. Although not wholly related to my main income stream all run through the same account .....

Or that is in principle - as at the moment I am now approaching my first accounts period and as yet have not submitted anything. Though all income goes through the company account.

Debt_Free_Chick wrote: »

Ignoring the mystery shopping for a moment .... unless you get another contract, surely your company will cease to trade due to the ending of the (current) contract ....?

I have to be careful here - the insurance policy does not pay out if it is just the end of a fixed term contract at the renewal point.... This is close but not quite a full 11 months.