Hi All,
I would like to invite your thoughts regarding my situation (as part of my wider research / due diligence).
I have been contracting since 2008.
I used the same limited company from 2008 to Mar-2021.
In Apr-2021, the consultancy I am working with came up with a blanket no-Limited-Company rule, so had to switch to an Umbrella, which is what I am using currently.
I did not see any near term prospects of an outside-IR35 contract, so I kicked off the company closure process later last year. VAT de-registration and Cessation accounts have been completed, and I have appointed a MVL solicitor.
However, I had a change of role at my client short while ago.
I have now moved from the IT delivery / implementation team (it was an IT BA role), to the Business team at the same client (role now involves day-to-day risk management, providing new requirements etc).
Came to know this week that the client may offer a direct (removing the above intermediate consultancy) outside-IR35 contract from Apr-2022.
In this situation (if the above new Business contract materialises), may I please ask what do you guys think would be the best option for working from Apr-2022 -
Option 1
Let the MVL of current IT Company continue. And use a new Limited Company (with a new SIC code) from Apr-2022 for the new contract that I will get on the Business side.
Few points to consider -
a) Given that the new role is different from what I was doing through the previous Limited Company, I think that the Condition C of TAAR rules won't apply. So this should be fine?
b) In fact, when I decided to close the company last year, the main purpose was not tax saving. I was closing the company only because I no longer needed it. So, I think Condition D also should not apply?
c) And as TAAR rules look at overall history and circumstances, please also note that I used the same Limited Company for 13 years, so I do not have any history of doing a MVL and opening another company.
How does my position look overall from the viewpoint of this option?
Option 2
Halt the MVL of current IT Company (if possible). And use the same existing Limited Company from Apr-2022 for the new contract that I will get on the Business side.
Few points to consider -
a) I will need to check whether I can stop the MVL process at current stage.
b) Even though the nature of work is different now, will it make sense to still use the old IT Limited Company?
Option 3
Let the MVL of current IT Company continue. And use an Umbrella Company from Apr-2022 for the new contract that I will get on the Business side.
Few points to consider -
a) By working through Umbrella, I will lose the flexibility that outside-IR35 contract offers, so may not be the ideal option I think.
b) Main advantage of this option though is that it won't have any TAAR related uncertainty.
Will be much appreciated if you could please share your thoughts.
I would like to invite your thoughts regarding my situation (as part of my wider research / due diligence).
I have been contracting since 2008.
I used the same limited company from 2008 to Mar-2021.
In Apr-2021, the consultancy I am working with came up with a blanket no-Limited-Company rule, so had to switch to an Umbrella, which is what I am using currently.
I did not see any near term prospects of an outside-IR35 contract, so I kicked off the company closure process later last year. VAT de-registration and Cessation accounts have been completed, and I have appointed a MVL solicitor.
However, I had a change of role at my client short while ago.
I have now moved from the IT delivery / implementation team (it was an IT BA role), to the Business team at the same client (role now involves day-to-day risk management, providing new requirements etc).
Came to know this week that the client may offer a direct (removing the above intermediate consultancy) outside-IR35 contract from Apr-2022.
In this situation (if the above new Business contract materialises), may I please ask what do you guys think would be the best option for working from Apr-2022 -
Option 1
Let the MVL of current IT Company continue. And use a new Limited Company (with a new SIC code) from Apr-2022 for the new contract that I will get on the Business side.
Few points to consider -
a) Given that the new role is different from what I was doing through the previous Limited Company, I think that the Condition C of TAAR rules won't apply. So this should be fine?
b) In fact, when I decided to close the company last year, the main purpose was not tax saving. I was closing the company only because I no longer needed it. So, I think Condition D also should not apply?
c) And as TAAR rules look at overall history and circumstances, please also note that I used the same Limited Company for 13 years, so I do not have any history of doing a MVL and opening another company.
How does my position look overall from the viewpoint of this option?
Option 2
Halt the MVL of current IT Company (if possible). And use the same existing Limited Company from Apr-2022 for the new contract that I will get on the Business side.
Few points to consider -
a) I will need to check whether I can stop the MVL process at current stage.
b) Even though the nature of work is different now, will it make sense to still use the old IT Limited Company?
Option 3
Let the MVL of current IT Company continue. And use an Umbrella Company from Apr-2022 for the new contract that I will get on the Business side.
Few points to consider -
a) By working through Umbrella, I will lose the flexibility that outside-IR35 contract offers, so may not be the ideal option I think.
b) Main advantage of this option though is that it won't have any TAAR related uncertainty.
Will be much appreciated if you could please share your thoughts.
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