2yr rule, umbrella or own company

[swebb]

Hi,

I've been using parasol for a fair while, today they put the price up yet again. This kicked me into gear and got me wondering if I should still be using and umbrella or not. I've read the first time thread and a few others but I'm not too sure these cover my situation.

I've been in the current contract for almost 2yrs and its within IR35 (on site, clients kit ......). So I won't be able to claim mileage or subsistence soon I'm now wondering if maybe I should set up a company and use SDJ or NW or someone like that but its not clear to me if this is worthwhile financially as I will be in a 2yr+ contract and some of the tax break are gone then.

Pensions is also a concern. At the moment I have one via parasol which has good tax breaks. Not to sure about pensions when setting up by yourself though and if the tax breaks are as good.

Any views ?

Thanks

Steve

[pisces]

My view is the same as always, dump Parasol. They're useless and too expensive. How much do they charge now?

[malvolio]

I've read the first time thread...its within IR35 (on site, clients kit ......).

Haven't read it very well then. Neither are directly relevant to IR35

FWIW there's moves afoot to stop umbrellas giving travel eallownaces anyway, oin the basis that you don't have any other permanent place of work, so longer term your own company is the way to go.

[anish]

My view is the same as always, dump Parasol. They're useless and too expensive. How much do they charge now?

£27.50 Per week now, i am considering dumping them and going LTD should i find a suitable accountant who can help

[Chugnut]

Hi,

I've been using parasol for a fair while, today they put the price up yet again. This kicked me into gear and got me wondering if I should still be using and umbrella or not. I've read the first time thread and a few others but I'm not too sure these cover my situation.

I've been in the current contract for almost 2yrs and its within IR35 (on site, clients kit ......). So I won't be able to claim mileage or subsistence soon I'm now wondering if maybe I should set up a company and use SDJ or NW or someone like that but its not clear to me if this is worthwhile financially as I will be in a 2yr+ contract and some of the tax break are gone then.

Pensions is also a concern. At the moment I have one via parasol which has good tax breaks. Not to sure about pensions when setting up by yourself though and if the tax breaks are as good.

Any views ?

Thanks

Steve

Steve, although more hassle than the umbrella option, I really would go limited + recommended accountant every time. Everyone's circumstances are different, but if your next contract is outside IR35, the umbrella doesn't care and will still 100% PAYE you. Why take that hit?

I'd also really advise being responsible for your own invoicing and admin as well, rather than rely on some umbrella payroll goon. I've experienced problems here first hand; get 'em out the payment chain!

[swebb]

Thanks for the replies guys. Obviously umbrella's aren't well regarded The new price is £93 from memory which is a hell of a lot more than when I first used them !

I'll give one or two accountants a ring and see what kind of cost they are and what telephone maner they have.

I don't suppose anybody knows what the tax situation is when you jump ship from an umbrella and go Ltd but stay with the same client and the same location ? My situation will be slightly complicated also because the work via the umbrella is less than 2yrs at the clients site, but the new contract via a Ltd company if I set one up will over 2yrs working at the same site. I'm not actually sure if when switching to Ltd if this resets the 2yr period, I suspect not.

Thanks again

Steve

[scooby]

Thanks for the replies guys. Obviously umbrella's aren't well regarded The new price is £93 from memory which is a hell of a lot more than when I first used them !

I'll give one or two accountants a ring and see what kind of cost they are and what telephone maner they have.

I don't suppose anybody knows what the tax situation is when you jump ship from an umbrella and go Ltd but stay with the same client and the same location ? My situation will be slightly complicated also because the work via the umbrella is less than 2yrs at the clients site, but the new contract via a Ltd company if I set one up will over 2yrs working at the same site. I'm not actually sure if when switching to Ltd if this resets the 2yr period, I suspect not.

Thanks again

Steve

i was with Parasol last year, then left due to poor service, and am currently in the process of setting up my Ltd Co with a usual suspect off CUK. his fees are about the same as the new Parasol fees, how you'll get a lot more from him!!

The umbrella i use now classes me as outside of IR35 and I'm Limited Liability Partnership, however my return is still around 62%... Ltd looks to be the best way forward, and everyone i know has never gone back to Umbrellas once Ltd.

[Ardesco]

£27.50 a week = £1,430 a year.

That's more than my accountant costs, and my accountant saves me money.

What other reason do you need?

[Alan @ BroomeAffinity]

I;ve never really been able to work out why anyone would use a brolly. I suppose there's convenience but that aside its just someone else grabbing a margin out of your income.

Even if you are fairly and squarely inside IR35 you can still take advantage of the flat rate VAT. Are you sure you are inside IR35? There's nothing in your original post to suggest this.

[DiscoStu]

The umbrella i use now classes me as outside of IR35 and I'm Limited Liability Partnership, however my return is still around 62%...

Eh?