How do you invoice now if a contract is within IR35?

[northernladuk]

It's a simple fact that a large number of contractors are/soon-to-be-were disguised employees and have become accidental directors because it was the most tax efficient method (at the time) of extracting funds from the company. They had/have no intention of being business owners.

I get that but how does that stop them at least using google with their livelihood in on the line?

[wilaxo]

Thank you to everyone who replied. I appreciate you taking the time to help.

Just to add some information here and why i asked the original question:

Before I started this contract I was already a limited company providing services to multiple clients which I invoiced and received payments from, I still have these clients. Early last year I was asked to provide services to a business on a contract for x months, billed on a day rate, invoicing them per month through my ltd company. This is exactly as I do non-contract work for other clients other than I do it on a day rate (and I was provided with equipment to access their internal network, attend progress meetings, etc) so I just did this as this is how I normally do things: I do work through my ltd company, I invoice from my ltd company, my company gets paid, My company pays me after taking off tax, national insurance, etc.

When I got knowledge of the IR35 changes I did look through HMRC, Google, etc to find information but the information was more related to individuals who have a limited company solely for the purpose of working for 1 client, which is not the case for me, hence my original question.

[Paralytic]

When I got knowledge of the IR35 changes I did look through HMRC, Google, etc to find information but the information was more related to individuals who have a limited company solely for the purpose of working for 1 client, which is not the case for me, hence my original question.

If that's what you found, then you were either reading the wrong things or misunderstanding. IR35 tests are applied against each and every contract/role on its own merits, independent of any other contracts that Ltd company may have active at the same time.

Have you asked your client/agency if they are willing to make deemed payments (net of taxes) directly into your Ltd company? Has anyone mentioned the need to move to an Umbrella engagement for this contract?

[cojak]

Thanks for the clarification wilaxo

[eek]

Thank you to everyone who replied. I appreciate you taking the time to help.

Just to add some information here and why i asked the original question:

Before I started this contract I was already a limited company providing services to multiple clients which I invoiced and received payments from, I still have these clients. Early last year I was asked to provide services to a business on a contract for x months, billed on a day rate, invoicing them per month through my ltd company. This is exactly as I do non-contract work for other clients other than I do it on a day rate (and I was provided with equipment to access their internal network, attend progress meetings, etc) so I just did this as this is how I normally do things: I do work through my ltd company, I invoice from my ltd company, my company gets paid, My company pays me after taking off tax, national insurance, etc.

When I got knowledge of the IR35 changes I did look through HMRC, Google, etc to find information but the information was more related to individuals who have a limited company solely for the purpose of working for 1 client, which is not the case for me, hence my original question.

So you are in the boat I would be in except that if any customer is deciding I'm their employee they aren't remaining a customer...

With multiple customers it's just not worth the hassle...

[malvolio]

If that's what you found, then you were either reading the wrong things or misunderstanding. IR35 tests are applied against each and every contract/role on its own merits, independent of any other contracts that Ltd company may have active at the same time.

Have you asked your client/agency if they are willing to make deemed payments (net of taxes) directly into your Ltd company? Has anyone mentioned the need to move to an Umbrella engagement for this contract?

Why? It simply confuses your accounting. If they are determined to treat you as inside IR35 and pay you accordingly, then they should put your net pay into your personal account, just like any other worker.

[eek]

Why? It simply confuses your accounting. If they are determined to treat you as inside IR35 and pay you accordingly, then they should put your net pay into your personal account, just like any other worker.

Yep - it's a personal contract so they should be making the OP an employee or the OP should be walking away.

I suspect if the OP did walk away the company may have a change of opinion if they cannot source the skills elsewhere which is likely to be the case,

[Paralytic]

Why? It simply confuses your accounting. If they are determined to treat you as inside IR35 and pay you accordingly, then they should put your net pay into your personal account, just like any other worker.

Agreed, but that's what the OP wants and is assuming it can be done. I just wondered if he'd actually asked the client/agency (not clear if he's direct with client or not).

[ComplianceLady]

Most MSP's are offering deemed payment service (as no one else will do it) Out of the hundreds of contractors I've spoken to who are flipping there's 2 that want to remain through PSC. They have other income through PSC. Whilst majority won't offer true inside IR35 it will still happen post 6 April