If you’re an Oil and Gas contractor working through a limited company, this year presents both challenges and opportunities. Between government policy forcing contractors to seek work abroad, changing tax allowances, and IR35, having a solid financial plan is more important than ever.
Whether you’re a Project Manager, Engineer, Drilling Supervisor or Geophysicist, this blog breaks down exactly how you can reduce your tax bill, stay compliant with HMRC, and free up more time to focus on your contracts. You will also receive:
- A personal service
- Fast response to emails & queries
- Unlimited Access to a specialised Chartered Accountant when you require
- One Contact Point
Why You Need a Specialist Accountant (Not a Generalist)
Oil and Gas contracting isn’t like other sectors. Although you are UK tax resident, you may be contracting abroad.
Most generalist accountants simply don’t have the depth of knowledge to deal with this.
Missing just one allowance or getting IR35 wrong can cost you thousands. That’s why working with a specialist accountant who understands Oil & Gas Contracting is crucial.
5 Key Areas to Focus On
1. Worldwide Subsistence Allowance
If you travel abroad for contracts, you may be able to claim a fixed daily allowance—covering meals, accommodation, and work-related travel—without triggering a personal tax charge. HMRC sets rates per country, and it can be a game-changer.
A specialist accountant will help you:
- Apply the correct rate
- Maximise the claim
- Stay fully compliant
2. Salary and Dividend Planning
The right salary/dividend split can significantly reduce your tax liability.
- Use your personal allowance wisely
- Pay dividends below higher-rate thresholds
- Add a spouse as a shareholder to spread income where appropriate
These tactics work best when reviewed regularly, especially when your profits or personal circumstances change.
3. Spouse Salaries and Shareholding
If your spouse helps with admin, marketing, or bookkeeping, you can:
- Pay them a fair salary (which is also tax-deductible)
- Share dividends to use their tax allowance
With good planning, this can help extract income at a 0–20% tax rate instead of higher rate bands.
4. Company Pension Contributions
Company pension contributions are one of the most efficient ways to withdraw money from your business:
- 100% Corporation Tax deductible
- Not subject to dividend or income tax
- Grows your retirement pot while reducing your current tax bill
5. IR35 Reviews
If your contract falls inside IR35, your take-home pay can drop significantly. We recommend:
- Getting your contract reviewed before starting work
- Keeping records of working practices (not just contract terms)
Bonus Tip: Don’t Delay Your Accounts
Many contractors wait until the last minute to file accounts—but early filing gives you more time to:
- Plan for tax payments
- Make pension contributions
- Adjust your salary or dividend strategy
- Better plan your income and taxes for the year ahead
Let a Specialist Do the Heavy Lifting
At Martin Cook Accounting Services, we’ve worked with hundreds of Oil & Gas consultants over 15+ years, saving clients millions in tax.
We’ll help you:
- Set up your Limited Company (if you’re new to Oil and Gas Contracting)
- Structure your income tax efficiently
- Stay compliant with VAT, IR35, and Corporation Tax
- Keep your financial admin stress-free
Final Thought
The energy industry is fast-moving, and your time is valuable. Let us handle the tax and compliance side so you can stay focused on your contracts, your clients—and your earnings.
Ready to review your tax strategy? Book a free consultation with us today.