Frequently Asked Questions

What is a Cake Single Person Limited Company?
A limited company with only one shareholder (you) and one employee (you), set up and run, for you, by Cake Income Management Limited.

Why go to all the trouble of setting up a Cake SPLC?
So you can take home more money. As an employee of your own Cake SPLC your income will be paid as a combination of salary and expenses and as a shareholder of your own company you will receive a regular dividend. This combination is by far the most tax efficient way of receiving income and simply means that you will take home more of the money you earn.

Am I an employee?
Yes you are. You are an employee of your own Single Person Limited Company. You have full employment status and continuity of employment. And because you are technically in continuous employment it could help improve your credit status, useful when it comes to applying for a loan or mortgage for example.

Do I have an employment contract?
Yes. You have a contract with your own Cake SPLC. Once your application has been processed we will send you two copies of your employment contract. You just sign and return one of the contracts to us to be kept in the company records and keep the other in your Cake SPLC Owners Manual for reference.

How is my pay made up?
You will be paid a salary and your legitimate expenses will be paid and as a shareholder of the company you will be paid a dividend.

As an employee of your SPLC you are entitled to the National Minimum Wage as laid down by Government legislation. It is essential that you receive the minimum wage as this will minimise your tax and allow you to claim normal statutory benefits should you need to. At the same time you can claim expenses against your company, travel to and from work for example. It is also essential that you claim your full allowable expenses as this will reduce your tax liability.

Once these two amounts - your wage and your expenses - have been deducted from your company income (all the money you have earned) we will be able to calculate profit. We then deduct costs and tax (which we send to the tax office for you) and pay you what ever is left as a dividend.

Cake Charges - How much does it cost?
There is a charge for setting up your Cake SPLC and a weekly admin charge for running it. However, you will be relieved to know that even after paying these charges you will still take home more of the money you earn.

The setup cost is a one-off charge of £20. This charge is paid in two equal installments over the first 2 weeks you work for your Cake SPLC.

The weekly admin charge is £26 plus VAT, but the charge is only made for those weeks you submit a timesheet. This means if you are not working (because you are ill, on holiday or between jobs) there is nothing to pay.

Both these sums are deducted from your take home pay and can then be claimed as legitimate expenses so reducing the tax you have to pay!

What do I get for my money?
We take care of all the hassle - the administration, filling in all the forms, ensuring that you and your SPLC comply with the requirements laid down by the government. And, when the legislation changes - as it does from time to time - we make sure that you know what’s going on and make the necessary changes for you ensuring that you stay on the right side of the tax office and Companies House.

Administration includes:

  • Cake sets up and registers your SPLC
  • Cake runs your payroll and pays your salary
  • We complete and file VAT returns, so you get VAT back on business costs
  • We provide all the necessary company officers (A limited company must have at least one Director and a Company Secretary for example.)
  • We Provide a Registered Office service for your company
  • Cake completes the dividend documentation for you to be paid dividends
  • We prepare and file annual accounts, year-end payroll returns, annual Returns and Corporation Tax returns.
  • Cake will handle all correspondence with HM Revenue & Customs
  • (previously Inland Revenue and Customs & Excise) and with Companies House.

In addition Cake also provides a friendly help and advice by telephone between 9am and 5pm Monday to Saturday.

How often do I get paid?
You continue to be paid in the same way as you are currently paid by your agency. Weekly, fortnightly or monthly.

Provided that you submit your timesheet by Midnight on a Friday your money will be in your bank account the following Friday. Cake can send you a text message confirming that this has happened.

How do I submit expenses?
Simply complete the Cake expense claim form, which is included in the Cake SPLC Owners Manual.

Make sure you follow the Cake expenses guidelines (again provided in your Cake SPLC Owners Manual and on the web site) remembering to attach original receipts to the claims form.

How much can I claim in expenses?
There is no limit as long as they are legitimate expenses for the sole purpose of carrying out your job. Your Cake SPLC Owners Manual contains guidelines on the legitimate expenses that can be claimed. It is very important that you submit claims for any allowable expenses every week to reduce your Corporation Tax bill.

Is it important to claim expenses?
Yes it is very important. By claiming for what is rightfully yours, Cake can make sure you maximise your income. This is money that you will need to spend anyway to enable you to do your job. It may be expenses incurred traveling to work or buying the equipment you need to carry out your job. By claiming these expenses we can set them off against the tax you would otherwise have to pay meaning you pay less tax and as a result you take home more money.

How do I make sure I claim the full amount?
We recommend that you call Cake the first time you make an expenses claim and we will help you fill in the form.

As part of the Cake service promise we will make regular checks on your expenses claims to make sure that you are making the best of the tax saving opportunities. And, if we think you can do better, we will let you know how to take home even more of the money you are earning.

NB. Please note that expenses are not repaid as extra money on top of the amount received by your SPLC from your agency. Instead we calculate the amount that can be offset against your SPLC’s gross profits to reduce the amount of tax you pay, and you see the result as more money in your bank account.

What about insurance?
Cake recognise the importance of you going to work with all your insurances in place and up to date. Your SPLC has public and employers liability insurance cover (there are some exemptions depending on your job). This insurance is covered in the Cake fee. Cake also provides a comprehensive Accident Insurance policy.

Depending upon your job you may need Professional Indemnity cover. We have specially negotiated rates for our members. Our Customer Services team will be happy to help you if you have any further questions.

Will Cake help me find new contracts?
Cake specializes in administering your SPLC ensuring you get paid more without having to worry about the hassle of managing a limited company. We do not help you find work. However, once you have a job opportunity from an agency or company you simply notify us and we put the appropriate contracts in place for the provision of your services through your SPLC.

Can I change agencies?
Yes and with no cost or penalty. Just let us know promptly when there is a change of agency and we will contact them. This will avoid any delays in payment to you and also ensure you are paid through Cake, allowing you to take advantage of the tax benefits available please refer to the Change of Agency form in the Cake SPLC Owners Manual.

What happens if I work for more than one agency?
Just let us know. Tell us which agencies you are working for in any one week and we will process your payment record accordingly.

When you change agency or when you work for more than one agency you will need to tell us if your pay frequency changes (for example, if you are currently paid monthly but your new agency pays weekly)

Will my agency mind if I become an SPLC?
No! In fact they will be pleased because once you are an SPLC, Cake will be providing payroll administration and this reduces the agencies costs.

NB. Guidelines on dealing with Agencies are included in your Cake SPLC Owners Manual.

What if I want to work abroad?
If you are offered work abroad, contact Cake before you start to check that we can still pay you through your SPLC. We will need to ask you some questions before we can confirm the position.

Are there risks or obligations for me as a shareholder?
No. Cake Income Management ensures all of its SPLC's comply with current legislation. Your rights as a shareholder are set out in the Articles of Association of your SPLC. We can provide a copy of this should you need one.

How much paperwork will I have to do?
Fill in the simple Cake SPLC Membership Application Form and then submit your timesheets, in the same that you do now and that’s it. Cake takes care of the rest.

Do I have to complete a self-assessment tax return?
You may have to complete a personal tax return at the yearend. Your Cake documentation has all the relevant information you require to allow you to complete your personal yearend tax return always providing you have worked exclusively through your SPLC.

Will I have any further tax to pay?
Generally you will not, but if your gross income from all sources exceeds about £35,000 a year you may be liable to pay further tax. You will need to complete a self-assessment tax return, so if you do not receive one it is in your interests to ask for one from the Inland Revenue.

What is IR35?
IR35 is tax legislation introduced in the 2000/2001 tax year to ensure that individuals who work through a limited company and receive a portion of their income as salary, and a portion as dividends are properly entitled to do so. The simple questions in the Cake SPLC Membership Application Form will help us to assess whether or not this is an issue.

If IR35 does apply to me can I still benefit from a Cake SPLC?
Yes. Even if IR35 does apply to you an SPLC is still more tax efficient provided your hourly rate is higher than £10.50 If you fall within the IR35 regulations you will not be paid in dividends you will instead be paid a combination of salary and legitimate expenses. This way everything is entirely legal, you take home more of the money you earned and you still receive all the benefits Cake has to offer.

How do I know when I have been paid?
If you have a mobile phone we can text you to confirm that payment is being made. In addition we will send you a payslip (weekly, fortnightly or monthly) detailing your earnings, on request this can be emailed to you.

How do I sign up?
You can either download and fill in the simple Cake SPLC Membership Application Form or call the Cake on 020 7649 9681and they will fill in the application form for you.

How long does it take?
Once we have received the completed form and your proof of ID, it takes up to 1 week to process your application and set in place the necessary arrangements with your agency.