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  1. #21

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    Quote Originally Posted by northernladuk View Post
    Why is this a factor?
    I use the flat rate VAT scheme. I like that extra 3.5% that comes back to me.
    I am trying to maximize my take home pay inside IR35.

  2. #22

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    Quote Originally Posted by ntdmr View Post
    My agency doesn't run PAYE as far as I know. My contract will have my rate (500), Somewhere in my chain the employERs NIC and apprenticeship level is paid on my behalf from my rate, and then the remainder comes to me, which I will then have to put through my own limited companies PAYE to pay myself?

    My chain is Me -> Agency -> REED -> Public Sector Client

    "Based on the assumption that your role will fall inside of IR35 come April 2017 should you continue to work through your PSC we would expect your day rate to be reduced to 437.45 (approximate figure we will confirm this exact figure closer to the time). You would invoice us per day at this rate and prior to making payment to you the necessary NI and Tax will be deducted at source by 165.62. Based on a full month worked the approximate take home under this method would be: 271.83 per day worked" - from my agent

    If I go umbrella I lose the ability to charge VAT?
    I filled in the missing XXX for you, the bold tells me they paying the personal TAX and NI to HMRC for you before the money gets to your company.

    Please tell me why you are worried about the VAT, when expenses are not allowed, you are going to miss out on a whole 0.88 a day (not your money anyway). I would tell the agent the 62.55 a day employers NI and apprenticeship level is not your problem (which it isn't).

  3. #23

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    Quote Originally Posted by ntdmr View Post
    I use the flat rate VAT scheme. I like that extra 3.5% that comes back to me.
    I am trying to maximize my take home pay inside IR35.
    your working it out wrong.

    (invoice x 1.2 ) x 0.165 goes to HMRC. Therefore you get a whole 0.2%

  4. #24

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    Quote Originally Posted by Hairlocks View Post
    your working it out wrong.

    (invoice x 1.2 ) x 0.165 goes to HMRC. Therefore you get a whole 0.2%
    I quite possibly am... this is what I thought:

    20 days * 500 = 10,000 + VAT = 12000.
    2000 VAT charged.
    Pay back at 16.5% = 1650.
    Therefore 350 comes back to me.

  5. #25

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    Quote Originally Posted by Hairlocks View Post
    I filled in the missing XXX for you, the bold tells me they paying the personal TAX and NI to HMRC for you before the money gets to your company.

    Please tell me why you are worried about the VAT, when expenses are not allowed, you are going to miss out on a whole 0.88 a day (not your money anyway). I would tell the agent the 62.55 a day employers NI and apprenticeship level is not your problem (which it isn't).
    These are the figures I got based on my current rate of 425.
    - Based on the assumption that your role will fall inside of IR35 come April 2017 should you continue to work through your PSC we would expect your day rate to be reduced to 375.41 (approximate figure we will confirm this exact figure closer to the time). You would invoice us per day at this rate and prior to making payment to you the necessary NI and Tax will be deducted at source by <AGENT NAME>. Based on a full month worked the approximate take home under this method would be: 4,908.00

    - Alternatively should you choose to work with one of our Approved Umbrella Companies of Giant or Parasol come April 2017, your daily rate would remain at 425.00 per day. There are two options with Umbrella, they will access directly with you your eligibility to claim expenses should you be able to claim expenses based on a full month work the approximate take home would be 5,475.00, should the decision be made that you are not eligible to claim expenses based on a full month work the approximate take home would be 5,302.00

  6. #26

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    Quote Originally Posted by ntdmr View Post
    I quite possibly am... this is what I thought:

    20 days * 500 = 10,000 + VAT = 12000.
    2000 VAT charged.
    Pay back at 16.5% = 1650.
    Therefore 350 comes back to me.
    Pay back at 16.5% of 12000 = 1980

    Therefore 20 comes back to you.
    Last edited by teapot418; 14th March 2017 at 17:11.

  7. #27

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    Quote Originally Posted by teapot418 View Post
    Pay back at 16.5% of 1200 = 1980

    Therefore 20 comes back to you.
    Thanks!
    I am starting to think umbrella is the way to go with this going forward! Hopefully can find the cheapest one I can?

  8. #28

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    Quote Originally Posted by ntdmr View Post
    Thanks!
    I am starting to think umbrella is the way to go with this going forward! Hopefully can find the cheapest one I can?
    Personally I'd go with an umbrella with a good reputation, rather than the cheapest

  9. #29

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    Quote Originally Posted by teapot418 View Post
    Personally I'd go with an umbrella with a good reputation, rather than the cheapest
    My agent is recommending Giant or Parasol. I also believe my accountants offer one.
    Open to recommendations / will look through these forums.

  10. #30

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    Quote Originally Posted by ntdmr View Post
    My agent is recommending Giant or Parasol. I also believe my accountants offer one.
    Open to recommendations / will look through these forums.
    ContractorUmbrella is recommended round these parts. I don't have first hand experience, but Lucy, their MD posts here, so worth giving them a call.

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