UK Contractor (Limited company) – How to manage payroll when still deciding annual salary

By | August 10, 2018

I'm a director of a UK limited company and working as a contractor, and my contract is due to end in December.

For the rest of the tax year I still don't know whether I'll then start a new contract or whether I'll then start permanent employment and get paid a salary.

This means that I still don't know whether/how much I want to pay myself as a (low) director salary from the ltd company until I know what my job situation is in the new year, as only then can I calculate my optimal ltd company payment strategy (salary vs dividends).

In the meantime, does anyone have any advice on what to report to HMRC PAYE? Am I best not paying myself any salary for now and submitting an EPS, then sending an FPS adjustment once I know more in February/March time and I end up going with the standard £8,424 salary threshold?

I appreciate that hiring an accountant would be advised in this situation, but if the answer is simple and clean cut then I thought it'd be worth asking.

Many thanks!