Evening everyone
I have to make a decision imminently (really should have been today) and I have been given until Tuesday to give an answer. I am afraid I find the subject rather confusing (despite how many threads/web pages I read) and would be eternally grateful for some help and advice. I will endeavour to be concise and please let me know if you need more information.
I work for my Ltd company serving an end client via a recruitment agency. I submit a weekly invoice to the recruitment agency.
The end client has ruled all contractors inside IR35 and has offered two options: (a) remain and continue to be paid by the recruitment agency but PAYE, or (b) join the end client PAYE on the books. Many contractors have left this week seeking work elsewhere. Others are holding out for a change of stance and are questioning the legality of the end client’s blanket decision.
Fortunately my position is different and I have other options. The end client accepts I am outside IR35 and agrees that my SDS is accurate. The end client is trying to make an exception for me (as they don’t want me to walk) and if successful I would be allowed to continue working as a PSC. However the decision rests with the Commercial Dept, and to honest it could go either way. To assist in their decision, the recruitment agency has provided details of an ‘IR35 Tax Liability Insurance product’ that I could purchase.
This afternoon the end client proposed another option. While they continue to try and make my PSC arrangement work, would I be interested in going PAYE via the recruitment agency if my day rate was upped by 25%? My current day rate is £700, and therefore it would increase to £875. The recruitment agency has clarified that the £875 figure represents my total cost to the end client, and my actual PAYE day rate would be £676.
Thank you for reading thus far. To cut a long story short I am trying to compare the take home pay between (a) current PSC arrangement, and (b) PAYE based on the £676/875 figures. I have tried in vain to speak to my Accountant (an online firm) but despite several calls there has been available suitable qualified to take my call. Fair enough I shouldn’t have left it so late. But sadly it’s only the last couple of days that information has been forthcoming from the end client.
Now for my silly questions (apologies in advance!).
How do I work out my take home pay based on working 5 days a week, 48 weeks a year (less Bank Hols). I take 10 days holiday in the summer, and 10 days off at Christmas although this includes some Bank Hols. I have experimented with online calculators but the results are always different and I’m not sure whether I am using the correct figures to begin with.
I am afraid I don’t know what my tax code is, or what it would be for PAYE. My tax affairs are basic to say the least. As basic as they can be. I have one contract, no staff, no investments etc. Not sure if this is relevant but I am aged 45 and married with 2 children. My husband is out of work thanks to Covid.
My Ltd company pays me £732.33 gross a month in accordance with advice from my online Accountant. The rest I take as dividends. Every month I withdraw the maximum dividend amount allowed by the Accounting Software and I use it to pay off debts. Don’t ask, it’s a tragic story!
The online Accountant has sensibly closed for the weekend so I thought I might try this forum so I am prepared for Tuesday.
Thanks for any kind soul able to help me, Amanda x.
I have to make a decision imminently (really should have been today) and I have been given until Tuesday to give an answer. I am afraid I find the subject rather confusing (despite how many threads/web pages I read) and would be eternally grateful for some help and advice. I will endeavour to be concise and please let me know if you need more information.
I work for my Ltd company serving an end client via a recruitment agency. I submit a weekly invoice to the recruitment agency.
The end client has ruled all contractors inside IR35 and has offered two options: (a) remain and continue to be paid by the recruitment agency but PAYE, or (b) join the end client PAYE on the books. Many contractors have left this week seeking work elsewhere. Others are holding out for a change of stance and are questioning the legality of the end client’s blanket decision.
Fortunately my position is different and I have other options. The end client accepts I am outside IR35 and agrees that my SDS is accurate. The end client is trying to make an exception for me (as they don’t want me to walk) and if successful I would be allowed to continue working as a PSC. However the decision rests with the Commercial Dept, and to honest it could go either way. To assist in their decision, the recruitment agency has provided details of an ‘IR35 Tax Liability Insurance product’ that I could purchase.
This afternoon the end client proposed another option. While they continue to try and make my PSC arrangement work, would I be interested in going PAYE via the recruitment agency if my day rate was upped by 25%? My current day rate is £700, and therefore it would increase to £875. The recruitment agency has clarified that the £875 figure represents my total cost to the end client, and my actual PAYE day rate would be £676.
Thank you for reading thus far. To cut a long story short I am trying to compare the take home pay between (a) current PSC arrangement, and (b) PAYE based on the £676/875 figures. I have tried in vain to speak to my Accountant (an online firm) but despite several calls there has been available suitable qualified to take my call. Fair enough I shouldn’t have left it so late. But sadly it’s only the last couple of days that information has been forthcoming from the end client.
Now for my silly questions (apologies in advance!).
How do I work out my take home pay based on working 5 days a week, 48 weeks a year (less Bank Hols). I take 10 days holiday in the summer, and 10 days off at Christmas although this includes some Bank Hols. I have experimented with online calculators but the results are always different and I’m not sure whether I am using the correct figures to begin with.
I am afraid I don’t know what my tax code is, or what it would be for PAYE. My tax affairs are basic to say the least. As basic as they can be. I have one contract, no staff, no investments etc. Not sure if this is relevant but I am aged 45 and married with 2 children. My husband is out of work thanks to Covid.
My Ltd company pays me £732.33 gross a month in accordance with advice from my online Accountant. The rest I take as dividends. Every month I withdraw the maximum dividend amount allowed by the Accounting Software and I use it to pay off debts. Don’t ask, it’s a tragic story!
The online Accountant has sensibly closed for the weekend so I thought I might try this forum so I am prepared for Tuesday.
Thanks for any kind soul able to help me, Amanda x.
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