Originally Posted by
MOZZER2
almost impossible to predict what his tax burden would be if he has been working using either a LTD company or sole trader for the reasons below
just a little about terminology he would personally not get 1.35 million from the BBC his company would . He would be a director of the company but also an employee of the company which means he can pay himself from the company
in terms of taxation 4 things
1 - He would pay himself a salary out of his company ( most free lancers pay themselves just under the threshold of paying any tax )
2 - Dividend tax - most freelancers take out dividends out of there business subject to taxation at certain levels
2 - He would pay corporation tax on his profit over the financial year .Was 19% think its going up to 25% this year
3 - He would pay VAT on anything over £85k but maybe more due to his turnover ( i would have to check that )
In terms of this most free lancers you can also claim on things like petrol and travel allowance , food allowance , accommodation , renting or leasing cars for his business , paying his phones , pension contributions , flat rate allowances etc and offset tax all out of his business
He also works for BT Sports so i guess he would be doing the same thing there and any other company he freelances for .Note taxation is different if he operates as a sole trader but i doubt he would be . But 1 thing for sure he would be paying less than 600K
As a rule of thumb in most industry's what ever an employee earns in 1 year a free lancer would earn in 6 months in the same company doing the same job and pay less tax before April 2021