I have just answered a question in Reception about the difference between an Individual and their Ltd Company…Which got me thinking.
It seems to becoming accepted that if you start up a Ltd Company… than you are a Tax cheat.
I recall Norman Tebbit (Arguably the Father of Freelancers with his “Get on your bike” speech…if you are of the Labour persuasion do not click on this link) talking a few budgets back, when the Self Employed NI increase was scrapped within hours of being announced.
We should not penalise hard working white van man, but I have no sympathy with white collar tax cheats who hide behind the wrapper of a company
Unfortunately this view is taking hold. This case especially is being used by HMRC to hammer the above point.
People used to be proud of telling their friends and families “I have started my own business”. I am not so sure that is the case these days?
My reason for starting my first consulting company (or PSC as it is unfortunately now being called) 26 years ago was simple. I was a “hard working self employed”… hovercraft designer. Unlike the white van man mentioned by Norman, if I made a mistake… it was not a dent in the wing that needing fixing…but potentially millions of pounds to redesign and rebuild the vessel.
I can still remember being on the sea trials of a 20m Hovercraft of which I had been the CAA approved Chief Designer (Nerd alert! Video of said hovercraft)
And realising that as my contract with the German company (who had funded the project) was with me direct and not with a Company I had opened myself and my family up to losing everything.
I have to say it was stressful time! I set up my own business and amended the contract to be between my Company and the client and slept easier at night.
It had absolutely nothing to do with the tax advantages of providing my services via a Corporate wrapper vs being Self Employed
Which is why I got pissed off in 1999 when Gordon Brown called me a tax cheat when he launched IR35. I got on my soap box and founded the PCG… together with 2000 other pissed off contractors.
And why I still get pissed off when Norman…(who should know better) calls me a White Collar Tax Cheat.
F$#k you and the Bike you rode in on springs to mind, but then I have always been a tad confrontational.
I would be really interested in hearing your reasons for starting your own business