Assessing IR35 working practices before signing contract

[groovybeetlecar]

Umbrella companies can do that due to needing to offer workplace pensions to their employees. See various threads in the Umbrella Companies sub section for more details. From my understanding it may be more beneficial via a brolly than contributing via Ltd (post PAYE if inside IR35 in public sector) due to how NI is handled.

My understanding was it couldn't be paid into my own pension that I pay into from my limited company and I didn't want a separate workplace pension just for three months.

TBH it's been a bit hard picking my way through this. There really must be very few people who voluntarily go IR35.

[Lance]

Full explanation here:

That's a 2014 article. Shouldn't you be more interested in the current odds?

[VectraMan]

I followed up with my questions and decided that due to the nature of the work, the contract is inside and decided to proceed on that basis.

The whole world seems to think I'm mad. But I couldn't with any integrity state I was outside when everything pointed to it being inside. My accountant agreed that the role was very likely to be inside but didn't seem particularly practiced at dealing with that for a start, suggesting that I went umbrella, which I really don't want to do for three months particularly as I want to maximise my pension payments to offset things.

Anyway, thanks for all your help, sorry I've not come back to the thread for a couple of days - I've been travelling and missed the responses.

I did the Friday to Monday thing and after a lot of thought decided to simply be inside IR35. Some people told me I was mad, but I just felt to act as if outside and hope it didn't happen wasn't the responsible way to run a business.

Pay as much as possible of anything that goes into the upper rate into a pension instead and it's not so bad. If you have a Ltd. I think you'd be daft to sign up for an umbrella. As far as accounting you basically need to make sure that salary + employers NI + pension = 95% of the gross (including VAT FRS gain if appropriate). If an accountant can't handle that, fire them. In fact fire them anyway and learn to do stuff yourself.

[groovybeetlecar]

Thank you.

To be honest, with the public sector stuff this year, I found myself wishing I'd just gone through an umbrella all along with that contract because I really enjoyed the job and left in mid March as they were not able to articulate their response in enough time to give me any confidence. I've been in the bench since, so I may as well jump back on with a role. And I'm hoping it will provide a bit more meat around an area of my CV which may increase chances of getting a new role quickly. Oh, and I've negotiated my rate up a bit to offset it slightly.

All good, and I can sleep easily at night.

[Hobosapien]

My understanding was it couldn't be paid into my own pension that I pay into from my limited company and I didn't want a separate workplace pension just for three months.

Yes you'd need to pay it into your own pension after receiving the money so post PAYE/emp NI.

As you're in private sector then may as well use your Ltd as the agency should only try to force you down the umbrella route if contract is public sector where PAYE/Emp NI needs sorting out before any invoice amount reaches your Ltd. May as well keep it as simple as possible if possible.