Principal Contractors?

[thedavegray]

Hi,

I have the chance to work for my old company which is based in Germany as a full time contractor based at home. I doubt I could qualify for IR35 as I will work
exclusively for this one company. So I did a bit of Googling around and found a company called "Principal Contractors" who claim to deliver 84% of earnings and
it's all legit, sounds too good to be true.

Anyone any experience or this or are using a similar company?

Based on this set-up should I just use an umbrella company, seeing as I need to bill the company in Euros or is the scheme mentioned legit?

thanks

[Kenny@MyAccountantFriend]

Hi,

There was a thread regarding this company last year: http://forums.contractoruk.com/accounting-legal/96849-principal-contractors-tax-efficiency-isle-man-trustees.html

Generally speaking if a company is referring to themselves as 'fully compliant' and supported by 'leading tax counsel or QC opinion', I tend to think there must be a reason why they are having to justify this.

They are also very vague on how you get paid and what tax is payable (if any).

[TheFaQQer]

I doubt I could qualify for IR35 as I will work exclusively for this one company.

Your knowledge and understanding of IR35 needs work.

sounds too good to be true.

It is.

If it was legitimate, everyone would do it. And yet they don't, so what does that tell you about these schemes?

[BolshieBastard]

"I doubt I could qualify for IR35 as I will work exclusively for this one company."

[DonkeyRhubarb]

Only 84%? There are other ̶c̶o̶n̶ ̶m̶e̶r̶c̶h̶a̶n̶t̶s̶ firms offering 90%.

Since you are going to end up screwed in the long run anyway, you may as well go for the biggest %.

[TykeMerc]

So I did a bit of Googling around and found a company called "Principal Contractors" who claim to deliver 84% of earnings and
it's all legit, sounds too good to be true.

Too good to be true? Hell yes.

As others have pointed out if these schemes were legit and never likely to come under attack by HMRC everyone would use them, the fact that most contractors don't may be an indicator.

There are loads of threads on CUK where people are being targeted for very nasty treatment by HMRC, if you want to join their ranks then go ahead and sign up to this or any other dodgy scheme that catches your eye, but be ready for years of pain, threatening letters, anguish, cost and possible bankruptcy.

[jamesbrown]

I doubt I could qualify for IR35 as I will work exclusively for this one company.

IR35 isn't a tax credit And, save some general pointers to being in business, it's determined for each contract separately, so your statement above is wrong, by definition. Your working practices may or may not be caught for this contract (you'd need a professional review in which you flag the last arrangement), but dictating the "what, where, when and how" would be a good start.

And regarding anything that's backed by QC opinion or flags a certain % take home as a selling point, don't be a muppet: avoid.