Switching from Umbrella to LtdCo mid contract

[PinkPoshRat]

I am about to start on a new contract and already have it all set up to use an umbrella company. What I will be doing once I have some money, is start up my own LtdCo.

Has anyone had any problems making the switch during a contract period? Is there anything which I need to watch out for?

There is no end date on the contract either, so it could never really be renewed thus giving me an opportunity to have the contract rewritten to include my LtdCo and remove the old Umbrella.

[The Wikir Man]

If you only intend to do one contract through the umbrella, then there are restrictions on what you can claim as an expense. Since you will only have one project, you can't claim that it's a temporary work palce (and claim travel and subsistence costs).

Not done the switch myself, but it's probably not as straight forward as it seems.

[PinkPoshRat]

I'm not really all too concerned about what I can and can't claim for. I'm more concerned about how 'easy' it is to have a contract with an agency rewritten.

Also, is there a general rule of thumb timeline in which an agent pays invoices, like 30 days, or is this something I must include in the new contract??

[The Wikir Man]

I'm not really all too concerned about what I can and can't claim for. I'm more concerned about how 'easy' it is to have a contract with an agency rewritten.

I don't know - most, I suspect, would insist on it being at renewal time. Since you don't have a renewal, I'm not sure how that would work - might be worth asking the agency, though.

As a completely different thing (which doesn't affect you at all while you are with an umbrella) is whether having an on-going, rolling contract is too similar to one of employment which then brings you inside IR35 when you move to a Ltd company.

Also, is there a general rule of thumb timeline in which an agent pays invoices, like 30 days, or is this something I must include in the new contract??

No timeline - it's up to you to negotiate it. I'm currently on weekly invoices paid on 30 day terms, but have been on monthly invoces paid within 7 days as well. If the agency and client look large enough, then I'm not too fussed about the potential of them disappearing with my money. If you think it's riskier / you want your money quicker, then negotiate a better payment term.