BADR/MVL, outside IF35 contract and umbrella

[eek]

So, what's the all fuss about these days with IR35? Unless we have a spouse and are happy to "share" our cake then there is not much profit from being outside. Lots of cash will build up in the business account without making any profit.

The fuss about IR35 comes down to expenses. Now the large bank I'm working at has solved that by having a 100% remote contract with zero need to be on site but it does mean it's very hard to do things that would once upon of time taken 5 minutes by hunting everyone down and having a quick conversation in a room. Now it requires 2 hours of planning to find a time when everyone can make the call.

[Maslins]

Your logic all sounds sensible. Do it via an umbrella (or as a permanent employee if that's an option), at least until you're 2 years post final distribution from the MVL. After that, you may well decide to stay as you are. Like you say the tax differential may not be too significant.

[fabios]

So, what's the all fuss about these days with IR35? Unless we have a spouse and are happy to "share" our cake then there is not much profit from being outside. Lots of cash will build up in the business account without making any profit.

[Protagoras]

My ltd was closed via MVL and I still have a few months left of the 2yrs period. But, I've just been offered an outside IR35 contract.
I see two options (apart from running away):
a) use umbrella for a few months and then setup ltd when 2 years have passed since MVL.
b) use umbrella for this client

Questions:
1) If i go with (a) should I do some extra work to make sure I can switch to ltd at a later point?
2) Does outside IR35 actually make much difference these days? 25% CT, £60k pension limit, inflation etc. I have nobody to share the dividends with so after taking the optimum + salary sacrifice the rest could be utilized for expenses. But the expenses are not great either given the cost of running ltd vs umbrella. EV is nice perk but on the other side I can buy 2nd hand one with a good discount.

Assuming that this is a Ch.10 'outside' then it's only really confirmed to be outside once the end client has made the first payment. Until then, client can change its mind. That's before you discover whether there are any indemnity clauses in the contract. Given your points in Q2, and considering the above, going with umbrella for this assignment could be the better option if expenses aren't a concern and you can max out on pension. Personally, I'd also say that short payment terms are also needed for umbrella working.

[eek]

I documented the difference between inside and outside IR35 (well for the first £60k or so of income) at https://forums.contractoruk.com/acco...ml#post2971986

Given that you provably have cash lurking round just focus on maximising your pension via an umbrella and move back to limited on first renewal in 6 months time.

[Lance]

My ltd was closed via MVL and I still have a few months left of the 2yrs period. But, I've just been offered an outside IR35 contract.
I see two options (apart from running away):
a) use umbrella for a few months and then setup ltd when 2 years have passed since MVL.
b) use umbrella for this client

Questions:
1) If i go with (a) should I do some extra work to make sure I can switch to ltd at a later point?
2) Does outside IR35 actually make much difference these days? 25% CT, £60k pension limit, inflation etc. I have nobody to share the dividends with so after taking the optimum + salary sacrifice the rest could be utilized for expenses. But the expenses are not great either given the cost of running ltd vs umbrella. EV is nice perk but on the other side I can buy 2nd hand one with a good discount.

c) wait till the 2 years is done.

[fabios]

My ltd was closed via MVL and I still have a few months left of the 2yrs period. But, I've just been offered an outside IR35 contract.
I see two options (apart from running away):
a) use umbrella for a few months and then setup ltd when 2 years have passed since MVL.
b) use umbrella for this client

Questions:
1) If i go with (a) should I do some extra work to make sure I can switch to ltd at a later point?
2) Does outside IR35 actually make much difference these days? 25% CT, £60k pension limit, inflation etc. I have nobody to share the dividends with so after taking the optimum + salary sacrifice the rest could be utilized for expenses. But the expenses are not great either given the cost of running ltd vs umbrella. EV is nice perk but on the other side I can buy 2nd hand one with a good discount.