andycal started this topic @ 08:41 on 10/05/2004
I'm confused. I've got PI and public liability, however someone just said that I need employers' liability. I'm LTD and I haven't any employees (I don't even pay myself, I just take drawings).
I don't pay PAYE or NI and my partner takes no part in the business, although she is a director.
Do I need it?
RE: Employers' liability
James Smith | 10/05/2004 09:41 AM
Andy,
If you dont have any employees other than directors (ie you and the Mrs) you dont need any employees liability insurance. There is no-one to make a claim agasint you.
On a side note it may be beneficial for you to draw a small salary via PAYE as part of your renumeration strategy if you dont have any other earned income. Presumably your accountant has advised otherwise due to your circumstances.
Regards,
------------------------
James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773
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Your indispensable guide to Small Business Bookkeeping, Self-Assessment & VAT
RE: Employers' liability
Barr | 10/05/2004 11:49 AM
There is a compulsory requirement for Employers Liability Insurance as a limited company even though you are the only employee/director. (hopefully to be removed soon!!!)
Have a look at this this link for more info.
http://www.accountingweb.co.uk/cgi-bin/item.cgi?id=124851
Barr Stevenson
Chartered Accountant
http:/www.our-accountants.co.uk
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Barr Stevenson
Chartered Accountant
http:/www.jsaccountants.co.uk
RE: Employers' liability
andycal | 10/05/2004 05:46 PM
Nuts. Looks like I'd better get it then. Any recommendations?
RE: Employers' liability
andycal | 10/05/2004 06:39 PM
"On a side note it may be beneficial for you to draw a small salary via PAYE as part of your renumeration strategy if you dont have any other earned income. Presumably your accountant has advised otherwise due to your circumstances."
Why's that?
RE: Employers' liability
James Smith | 10/05/2004 08:05 PM
Andy,
Regarding remuneration strategies (I will leave any insurance advice to Barr!) if you pay a small salary to yourself that does not lead to the payment of income tax (normally £4745 for 2004/5) the company will have lower taxable profits (your salary being a company expense) and therefore reduce its corporation tax bill. You would not personally pay any extra tax.
For a company earning say £40,000 a year, this would be a saving of some £1100 per annum. (£4745*0.2375)
If for example you have a second income (ie the ltd company is on the side) it would not normally be advantageous to pay a salary in the way as income taxes on this salary would be higher than the corporation tax saved. Payment of salary also has the side advantages of “buying your NI Stamp” as my mother would call it, theoretically entitling you to state benefits.
I had thought in my post you had been advised not to pay a salary, as this is a pretty standard profit extraction policy. If you need some help in running your limited company I would be pleased to assist as it can be quite involved to the un-initiated, I do a very reasonable “get you started” package for the new ltd company to go through the requirements to keep the right side of the regulations and how to make best use of your company structure from the outset. This tend to avoid remedial work at the end of the year, and stops you having to worry about all the regulations.
Regards,
------------------------
James Smith
Chartered Accountant
www.jamesesmith.co.uk
01235 536 773
---------------------------
Your indispensable guide to Small Business Bookkeeping, Self-Assessment & VAT
RE: Employers' liability
brianfin | 13/05/2004 08:41 PM
You must cover yourself from all sides. Do not forget managing directors liability, don't you have staff liability with that, or with full co liability, phone a few assurance co's they will give you prices and don't sign the first one you meet.
brian fin
on
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Brian Fin
www.businessbx.com
www.courtico.com
on
