• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.

Can I please get some help with choosing Umbrella or PAYE for my contract?

Collapse
X
Collapse
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    Can I please get some help with choosing Umbrella or PAYE for my contract?

    Hi everyone,

    I have been at my current client for about 7 months operating outside IR35 via LTD company where I am the sole director.
    • My day rate is £550 a day.
    • As per many other clients, they have applied a PSC ban and given a choice of Umbrella or PAYE.
    • PAYE would be via an agency not the client itself.
    • Umbrella I have an option to select my own or go with a recommended one from the agency.
    • Should I go Umbrella, the client has raised the day rate to £640 a day to cover for loss of income.
    • The contract extension is for another 3 months from 1 April 2021 with a view for possible extension.
    I am aware by staying I risk an investigation by HMRC but I am in a tricky situation where I need the money in the tough economy to support my family and kids. When the right opportunity comes I will leave.

    In terms of Umbrella or PAYE, what would be the better option?
    • In my case I rarely pay into my pension currently, but would like to.
    • There is a possibility of working with multiple clients e.g. take an odd 10 day consulting contract with another client while working with my main client. But realistically I don't know whether that will happen, it's something in the future which may not happen.
    • My expenses are quite low, about £150 a month currently.

    I'd appreciate any help and guidance and happy to answer any questions in case I missed something above.




    #2
    there's a whole sub-forum on Umbrellas.
    If it was me I'd take the £640 and use a brolly that will allow salary sacrifice pension contributions.
    Forget expenses unless the client are paying them
    See You Next Tuesday

    Comment


      #3
      Hi Lance

      Thanks for this. Are there any specifics you recommend when it comes to reviewing salary sacrifice options? In my case there is an annual 0.73% management cost, and it would be with a provider that I already have a pension pot with should I choose the recommended Umbrella company by the agency.

      Comment


        #4
        Originally posted by ChrisHadfield View Post
        Hi Lance

        Thanks for this. Are there any specifics you recommend when it comes to reviewing salary sacrifice options? In my case there is an annual 0.73% management cost, and it would be with a provider that I already have a pension pot with should I choose the recommended Umbrella company by the agency.
        No idea. Read the threads. I've never used a brolly. but it's not uncommon what you're looking for.

        As an aside. 0.73% management fee is a little on the high side. Have a look at the various SIPP threads on here as well.
        See You Next Tuesday

        Comment


          #5
          Originally posted by ChrisHadfield View Post
          with should I choose the recommended Umbrella company by the agency.
          No. It's more common for the agency to give a you list and you have no options but if they do allow you to chose your own then no, do not go with their recommendation as it will be for kickbacks only. Go out and find one that suits your needs.

          I am aware by staying I risk an investigation by HMRC but I am in a tricky situation where I need the money in the tough economy to support my family and kids. When the right opportunity comes I will leave.
          You might as well stay if that's your approach. As soon as you walk in the door on your inside contract you are stuffed. You need to leave when any opportunity comes up, not the right one. The longer you are there the longer you are at risk. How much effort have you put in to trying to leave?

          Where is your warchest if you can't leave a gig? What if you are pushed out of a gig, where would you be?
          'CUK forum personality of 2011 - Winner - Yes really!!!!

          Comment


            #6
            Might wanna get admin to change your username as well. HMRC read these forums so posting a thread about going outside to inside using your real name isn't, erm, ideal.
            'CUK forum personality of 2011 - Winner - Yes really!!!!

            Comment


              #7
              Originally posted by northernladuk View Post
              Might wanna get admin to change your username as well. HMRC read these forums so posting a thread about going outside to inside using your real name isn't, erm, ideal.
              I'm pretty sure that Chris isn't the Bowie-singing astronaut of that name...
              "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
              - Voltaire/Benjamin Franklin/Anne Frank...

              Comment

              Working...
              X