A little bit of advice needed please...

[zoooom]

Hello,

I am a contractor currently getting paid through giant as an umbrella company. This is my first contract and I work 37.5 hours a week for £15/hour. I worked out the other day I am taking home around about 60-65% of what I earn, which if i'm being honest seems absolutely tulip.

Given that there is 10 months left on my contract, is it worth me setting up a limited company? how much extra money am I likely to take home minus the additional costs? I have read internet guides and all the forum stickies but could do with an opinion based on how much I actually take home.

thanks!

[DiscoStu]

What are your expenses?

Are your contract and working conditions inside or outside IR35?

[Beefy198]

I worked out the other day I am taking home around about 60-65% of what I earn, which if i'm being honest seems absolutely tulip.

Fairly standard for a PAYE employee

[krytonsheep]

If you worked 52 weeks a year on your wage (and are inside IR35) the take home pay should be about 69% as a Ltd.

So you could make some extra cash, but it might not be worth the hassle.

[hiteshg]

How much do they charge ?

honestly you can start a ltd company. As this is your first contract chanes are that you fall outside IR35.

If you think its a hassle try some other umbrella companies that charge you anything. Some have 3 month trial period. one has 5 years free offer search for Ganumbra in google. you will save plently on fees. some relief.

If you start your own company , these accountants will suck most of your moeny. and legalities will suck you time

[zoooom]

Thanks for your speedy replies!

What are your expenses?

Are your contract and working conditions inside or outside IR35?

I think I'm inside... I remember reading up on it a while back and isn't there something saying if you are working in the same location for over a certain amount of time you fall within it? also the only expenses I'm claiming at the moment are travel expenses.

If you worked 52 weeks a year on your wage (and are inside IR35) the take home pay should be about 69% as a Ltd.

So you could make some extra cash, but it might not be worth the hassle.

Yeah considering I would have to pay an accountant wouldn't I? or is that factored in to your estimation?

Thanks for your help, I really am a bit of a noob about all this!

[NotAllThere]

I think I'm inside... I remember reading up on it a while back and isn't there something saying if you are working in the same location for over a certain amount of time you fall within it?

No. Go do some research. Start with the little box on the left entitled "CUK Navigation".

Company Formation
First Timers
Legal : IR35
Legal : S660 / MSC
Contractor Guides

[tino]

honestly you can start a ltd company. As this is your first contract chanes are that you fall outside IR35.

If you think its a hassle try some other umbrella companies that charge you anything. Some have 3 month trial period. one has 5 years free offer search for Ganumbra in google. you will save plently on fees. some relief.

If you start your own company , these accountants will suck most of your moeny. and legalities will suck you time

As this is your first contract chanes are that you fall outside IR35. Bull, it has absolutely no bearing on whether he is in or out of IR35

[krytonsheep]

the 69% estimate was excluding an accountant (and expenses/insurance).

[sweetandsour]

£15 per hour?

Maybe it is time for me to give up this IT lark.

To the OP, because you are using an umbrella company Employees and Employers National Insurance Contributions are being deducted from your earnings.

If you are caught by IR35 then you have to live with that.

If you are not caught by IR35 then you don't have to pay those if you use a Limited Company.

This being your first contract has no impact on whether you are IR35 caught or not. It depends on your contract, the contract between your pimp and the client, and the working arrangements.