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bigduckontax
bigduckontax, Accountant
Category: Tax
Satisfied Customers: 3811
Experience:  FCCA FCMA CGMA ACIS
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I've started a part time job in the renewables industry and

Customer Question

I've started a part time job in the renewables industry and also stand to earn some money through musical assets (sale of recorded music). I'm trying to work out if it would be a good idea to set up as a private limited company. If I was self employed i would earn £2133 per month. I may earn anywhere from £50 - £500 per month from the music (This may then increase in subsequent years).
If i just worked the part time job i believe I may fall into the IR35 bracket but would the addition of the music revenue remove me from that? Would all revenue have to come through the same company?
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.
If you set up a limited company then as a director you would be deemed an employee and have to be remunerated through PAYE arrangements. Furthermore, the company would be liable for any employer element of NI involved. However, if you leave profits within the company that would be subject to Corporation Tax at 20%. If you self employ you will be subject to IT and NI also, but there are more openings available to you to offset tax.
On your part time job your employer will deduct Income Tax and NI through PAYE. You are in the classic situation laid down by Benjamin Franklin in g=his dictum that in life there are but two certainties, death and taxes!
All the revenue need not come from the same source, you can be both an employee and be self employed simultaneously and indeed be employed by multiple employers.
I do hope I have helped explain the position to you.

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