PSC agreement UK Accountancy advice & Per Diem living allowance
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£134(approx. $168)
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- Proposals: 3
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- #2232955
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Description
Experience Level: Intermediate
Consultancy on the following:
I am an independent contractor, providing the consultancy service as ltd for other companies. Currently I have no employees. I would need help & advice on the proposal that I received from some UK based accounting company. They approached me with "PSC agreement" which is the following service to help me reducing the taxes:
1. A company (A) would invoice my UK ltd. company every month for instance £6000 + VAT = £7200 for some "intangible" IT service. So that would generate the expense to my ltd.
2. I would reclaim £1200 VAT back to my ltd.
3. I would be employed by a company B, based in Poland, which would pay me the salary as broke-down below.
Breakdown based on a £6,000 invoice paid:
I get 90% of that which is £5,400 net after PAYE including all the taxes
Sample Breakdown:
£1’300 UK PAYE
£1’300 Salary from 2nd Employment (Poland)
£93.33*30 DAYS = £2,800 per day living allowance (Per Diem) being an offshore employee / asset.
Net salary: £5,400 paid per invoice monthly
My question is - do you have any experience with that?
Is that legal, or could it potential cause any risks for me in the future? Could it alert HMRC to check my ltd?
What would happen with my personal income, would I have to pay any additional tax on that in the future, or something hidden?
Can I trust this company, as it seems like tax avoidance scheme to me.
I would probably need 30min of your time to discuss and to understand the topic. Please only contact me, if you have experience with it, so you can provide the advice, not an opinion please.
I am an independent contractor, providing the consultancy service as ltd for other companies. Currently I have no employees. I would need help & advice on the proposal that I received from some UK based accounting company. They approached me with "PSC agreement" which is the following service to help me reducing the taxes:
1. A company (A) would invoice my UK ltd. company every month for instance £6000 + VAT = £7200 for some "intangible" IT service. So that would generate the expense to my ltd.
2. I would reclaim £1200 VAT back to my ltd.
3. I would be employed by a company B, based in Poland, which would pay me the salary as broke-down below.
Breakdown based on a £6,000 invoice paid:
I get 90% of that which is £5,400 net after PAYE including all the taxes
Sample Breakdown:
£1’300 UK PAYE
£1’300 Salary from 2nd Employment (Poland)
£93.33*30 DAYS = £2,800 per day living allowance (Per Diem) being an offshore employee / asset.
Net salary: £5,400 paid per invoice monthly
My question is - do you have any experience with that?
Is that legal, or could it potential cause any risks for me in the future? Could it alert HMRC to check my ltd?
What would happen with my personal income, would I have to pay any additional tax on that in the future, or something hidden?
Can I trust this company, as it seems like tax avoidance scheme to me.
I would probably need 30min of your time to discuss and to understand the topic. Please only contact me, if you have experience with it, so you can provide the advice, not an opinion please.
Michal S.
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