Get Started!

What's the difference between Limited Companies and PAYE?

From 1st September, Florence will be offering our nurses and carers two ways of getting paid:

  1. Through a Limited Company
  2. Through Florence PAYE

Below we outline the difference between the two options so you can decide which is right for you.

Please note, we do not engage with umbrella companies.

Limited Company or PSC

What does this practically mean for me?

As Director of a PSC you are responsible for:

  • Determining your own tax status and complying with current IR35 Legislation and Income Tax (Earnings and Pensions) Act 2003
  • Registering your Limited Company and completing all the required filings at Companies House and HMRC
  • Annual self-assessment tax return
  • Paying all your taxes and national insurance contributions

Your tax status depends on various factors, for example the nature of your work, and is subject to change, so we strongly recommend you seek professional advice on this.

You’ll also likely need to engage with and pay for an accountant as well as set up a company bank account for your income and any associated expenses.

For more detailed information you can read the government guides on registering for corporation tax, or checking your employment status for tax purposes.

I have decided this is the best option for me, what do I need to do?

You will need to share with us your:

  • Limited Company name
  • Limited Company number
  • VAT status (Registered/ Not Registered)*

*a business only needs to register for VAT if taxable turnover is over £85,000 per year. For further information on this please see the government guide on VAT registration

Additionally, you’ll be prompted to update your bank account details next time you login to Florence.

We recommend that you seek advice from a professional to help you understand all this in more detail before selecting this option.

Florence PAYE

What does this practically mean for me?

We’ll organise payment of all the right taxes and deductions for you through our payroll provider. The rate you see for shifts on Florence will be slightly lower than if you were being paid through a PSC to account for payroll costs, but you won’t need to worry about anything else.

Through PAYE, you’ll be paid every Friday for any timesheets that have been approved before 9am on that Friday morning. You’ll get a payslip and as payments are made weekly, you might find it easier to organise your money as you’ll know exactly when you’re getting paid for each shift.

You’ll also be entitled to protections applicable to workers. For more information on worker protections, read the government guide.

I have decided this is the best option for me, what do I need to do?

You will need to share with us:

  • Your National Insurance number .
    This should start with two letters, followed by six digits and one more letter.
    E.g. QQ123456C.
  • A completed copy of the HMRC New Starter Form .
    You can complete it online here, and simply send us the PDF you receive at the end.
  • A copy of your P45 (if you have one) .
    This is so we can work out your correct tax code. Without a P45 you might be emergency taxed in your first payslip, so it’s best to double check if you have one.

Once we have these details, one of the team will get in touch with you to send you your contract, which you’ll need to sign and return to us.

Was this article helpful?
Yes No