First time contracting and inside IR35. What's my eventual take-home?

[Mrjay]

Hi guys.

Probably a very common question by now but I haven't found an answer to my specific problem yet.

I'm about to start my first contract with Network Rail via Capita and I was offered 3 options of Umbrella/LTD/PAYE.

Umbrella - £200
LTD - £175
PAYE. - £155 with holiday/sick pay

First of all, does this look correct?

My query is now with the PAYE route. I assumed that the PAYE day rate would be my take home as all other tax deductions would have been made (hence the lower rate), but I've been advised that NI and 1% (pension) are to be deducted from that £155 day rate. Is this correct? Based on the figures, what would my weekly take-home be?

I've also queried a number of Umbrella companies and the rough percentage estimate for take home is about 64%. Having worked it out, the PAYE still looks the best option for me. I've worked out my take home should be about £680. Is my maths correct?

Please help!!!

[Lance]

Hi guys.

Probably a very common question by now but I haven't found an answer to my specific problem yet.

I'm about to start my first contract with Network Rail via Capita and I was offered 3 options of Umbrella/LTD/PAYE.

Umbrella - £200
LTD - £175
PAYE. - £155 with holiday/sick pay

First of all, does this look correct?

My query is now with the PAYE route. I assumed that the PAYE day rate would be my take home as all other tax deductions would have been made (hence the lower rate), but I've been advised that NI and 1% (pension) are to be deducted from that £155 day rate. Is this correct? Based on the figures, what would my weekly take-home be?

I've also queried a number of Umbrella companies and the rough percentage estimate for take home is about 64%. Having worked it out, the PAYE still looks the best option for me. I've worked out my take home should be about £680. Is my maths correct?

Please help!!!

ask HR. Give them a ring, and tell them your tax code and they'll be able to tell you (for PAYE that is).
For Umbrella, ring one and ask them.
For LTD. On £175 a day, inside IR35, forget it.

[northernladuk]

It is very common question so it has it's own part of the forum specially.

Go look here. This has been discussed extensively in there.

Public Sector IR35

All the options, benefits and some stuff you've not got round to asking about yet i.e. pension options with brollies yadda yadda is all in there.

[Mrjay]

Thanks!!

Thanks for the reply guys.

I should have stepped out into contracting last year

I'll re-check the other thread

Regards

[Chart Accountancy]

If you are LTD, you will not have pension deductions. In addition, you can still claim general business expenses not linked to your IR35 contract and offset against any future profits outside IR35. Ltd should have the higher take home from the three options but it will not be a massive difference.

[pr1]

Network Rail - it's outside IR35!

Network Rail deems all off-payroll workers outside IR35 :: Contractor UK

[Lance]

Network Rail - it's outside IR35!

Network Rail deems all off-payroll workers outside IR35 :: Contractor UK

You quote a four month old article as fact. Without apparently reading it.

“As the HMRC tool is being continually reviewed…the current determination could change at any time,” Network Rail acknowledges in a breakdown of the roles, sent to affected staff.
If the tool or the HMRC guidance surrounding the tool changes, Network Rail will rerun the tool on the below roles and send a new determination out.”

Have you an update based on the current situation?