Advice/Information Please .... be gentle !

[2funky4u]

Not really. You haven't been deemed outside then inside. They've cheated and just done a blanket ban on contracts. It's not a contract anymore it's effectively employment. There is no determination for the new role.

Will HMRC come sniffing? Your guess is as good as mine. Although they have no comparison of before and after it might not stop them coming after the previous contract. That said, they'll have their hands full with all the slam dunk outside to inside cases so you'll be waaaaay down the list.

Not much risk so no not really.


You search for PAYE calculator on the web and chuck your numbers in to it. There are even ones that will compare inside and outside so you can work out exactly what the hit is. Tough hey.

The actual figure will vary slightly due to your current tax code and any costs incurred by using PAYE but it's gonna give you a ballpark figure. If you really want to know then go to the company being proposed as PAYE and get them to give you a detailed response.

I'll bet it's around 30-35% less.

Correct. You will get NET pay directly to you. No need for LTD anymore. They are likely to charge you for the pleasure as well. When I was PAYE I had a rate for them to do PAYE or a rate for an umbrella to do PAYE. Umbrella was higher as it didn't have their charges on it but when I took the brolly payments off it came out about the same in my pocket.

Correct. They will probably keep some money back form what they pay you for holidays so you still get paid when you take them, you've just paid up front.
You really must have a long sit down with the agency PAYE and understand all this before you sign for anything.

I'm absolutely sure I've glossed over something that's a hell of a lot more complicated so for you to do a lot of your own research based on many other circumstances in play that we are not privvy to.

Many thanks for that in depth response, definitely makes things clearer in my head !

[northernladuk]

3. Should I choose to go down the PAYE option with the same Retailer:-
- Does this not effectively say, I am inside IR35 and have always been for the previous 10 months and there is a risk that HMRC could look at my previous history and deem I owe them some more tax

Not really. You haven't been deemed outside then inside. They've cheated and just done a blanket ban on contracts. It's not a contract anymore it's effectively employment. There is no determination for the new role.

Will HMRC come sniffing? Your guess is as good as mine. Although they have no comparison of before and after it might not stop them coming after the previous contract. That said, they'll have their hands full with all the slam dunk outside to inside cases so you'll be waaaaay down the list.

- If I was to go down the PAYE option – but as a different role – say Consultant – does this mitigate the above risk

Not much risk so no not really.

- I am quite embarrassed to ask this question, but how do I work out what the effective hit from a ‘money in my pocket’ was if I went down the PAYE route.

You search for PAYE calculator on the web and chuck your numbers in to it. There are even ones that will compare inside and outside so you can work out exactly what the hit is. Tough hey.

The actual figure will vary slightly due to your current tax code and any costs incurred by using PAYE but it's gonna give you a ballpark figure. If you really want to know then go to the company being proposed as PAYE and get them to give you a detailed response.

I'll bet it's around 30-35% less.

- As the PAYE options still stipulates that it needs to be done through an Agency – I assume my PAYE will be with the agency and they will take off any tax requirements before paying me

Correct. You will get NET pay directly to you. No need for LTD anymore. They are likely to charge you for the pleasure as well. When I was PAYE I had a rate for them to do PAYE or a rate for an umbrella to do PAYE. Umbrella was higher as it didn't have their charges on it but when I took the brolly payments off it came out about the same in my pocket.

- Does the PAYE option effectively mean a Fixed Term contract with holiday payment, statutory sick pay, pension, no benefits etc ( I currently pay into a SIPP and assume this will no longer be possible for my LTD company to make any SIPP payments)

Correct. They will probably keep some money back form what they pay you for holidays so you still get paid when you take them, you've just paid up front.
You really must have a long sit down with the agency PAYE and understand all this before you sign for anything.

I'm absolutely sure I've glossed over something that's a hell of a lot more complicated so for you to do a lot of your own research based on many other circumstances in play that we are not privvy to.

[ladymuck]

The small company route you propose is, as Tarby says, going to result in the same outcome. The end client has determined the role is inside and adding an extra entity in the way will not change that.

[2funky4u]

Stopped reading your post 1/3 way down

You will get paid as an inside IR35 contractor


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Sorry not quite getting what you mean ? Do you mean if I went to work through a small consultancy on the end clients project ?
Thanks


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[GhostofTarbera]

Advice/Information Please .... be gentle !

Stopped reading your post 1/3 way down

You will get paid as an inside IR35 contractor


Sent from my iPhone using Contractor UK Forum

[Maka344]

My current situation is I am an IT contractor who has my own Ltd company (with me as the only employee). I am currently contracting for a End Client through an agency and have been for circa 10 months (on this current contract). I provide a specific role as a Technical PM for a specific project. The agency sent out the following comms (finally) on the end clients plans for contract resources.

As of March 23rd all contractors will be engaged on a PAYE contract (only – no umbrella) through **Agency** or your supplying agency. We will be serving the 4 week notice on all current umbrella and Ltd company contracts (that run past the 22nd March) on the 21st February

So my initial questions around this are:-

1. I think I know the answer.... but if I were to engage, through my ltd company as a contractor, with another consultancy who are classed as a ‘small business’ and who have already got an MSA and carry out some work for the End CLient, would that be an option? I am effectively offering my services to the consultancy outside IR35 and they are providing a resource that they do not have to the Retailer. Does this fall under the new legislation and effectively mean the end client, are responsible for accessing whether I am outside IR35 ? If so – as the end client has stipulated they will only engage contractors on a PAYE basis – given this, I assume they will not take this as a feasible option.
2. My current contract ceases on 01/03/2020 – so payment on my final invoice should be made before April. Assume there is no issue with this, given I do not extend my contract any further.
3. Should I choose to go down the PAYE option with the same Retailer:-
- Does this not effectively say, I am inside IR35 and have always been for the previous 10 months and there is a risk that HMRC could look at my previous history and deem I owe them some more tax
- If I was to go down the PAYE option – but as a different role – say Consultant – does this mitigate the above risk
- I am quite embarrassed to ask this question, but how do I work out what the effective hit from a ‘money in my pocket’ was if I went down the PAYE route.
- As the PAYE options still stipulates that it needs to be done through an Agency – I assume my PAYE will be with the agency and they will take off any tax requirements before paying me
- Does the PAYE option effectively mean a Fixed Term contract with holiday payment, statutory sick pay, pension, no benefits etc ( I currently pay into a SIPP and assume this will no longer be possible for my LTD company to make any SIPP payments)

The options I see at the moment are as follows:-

1. Take the PAYE option and take the hit from a finance perspective and also the risk of HMRC investigating my previous engagement.
2. Look for a an outside IR35 contract (given the market will be quite difficult to find)
3. Look for a permanent position – but not back at the current retailer initially.

I have tried to read a number of threads to try and comprehend some answers, but I'm really struggling - so excuse my post if you feel I've not done the right research !!

Many Thanks!!

I’m currently contracting with the same Luxury Retailer and received the same email. PM me.

[2funky4u]

My current situation is I am an IT contractor who has my own Ltd company (with me as the only employee). I am currently contracting for a End Client through an agency and have been for circa 10 months (on this current contract). I provide a specific role as a Technical PM for a specific project. The agency sent out the following comms (finally) on the end clients plans for contract resources.

As of March 23rd all contractors will be engaged on a PAYE contract (only – no umbrella) through **Agency** or your supplying agency. We will be serving the 4 week notice on all current umbrella and Ltd company contracts (that run past the 22nd March) on the 21st February

So my initial questions around this are:-

1. I think I know the answer.... but if I were to engage, through my ltd company as a contractor, with another consultancy who are classed as a ‘small business’ and who have already got an MSA and carry out some work for the End CLient, would that be an option? I am effectively offering my services to the consultancy outside IR35 and they are providing a resource that they do not have to the Retailer. Does this fall under the new legislation and effectively mean the end client, are responsible for accessing whether I am outside IR35 ? If so – as the end client has stipulated they will only engage contractors on a PAYE basis – given this, I assume they will not take this as a feasible option.
2. My current contract ceases on 01/03/2020 – so payment on my final invoice should be made before April. Assume there is no issue with this, given I do not extend my contract any further.
3. Should I choose to go down the PAYE option with the same Retailer:-
- Does this not effectively say, I am inside IR35 and have always been for the previous 10 months and there is a risk that HMRC could look at my previous history and deem I owe them some more tax
- If I was to go down the PAYE option – but as a different role – say Consultant – does this mitigate the above risk
- I am quite embarrassed to ask this question, but how do I work out what the effective hit from a ‘money in my pocket’ was if I went down the PAYE route.
- As the PAYE options still stipulates that it needs to be done through an Agency – I assume my PAYE will be with the agency and they will take off any tax requirements before paying me
- Does the PAYE option effectively mean a Fixed Term contract with holiday payment, statutory sick pay, pension, no benefits etc ( I currently pay into a SIPP and assume this will no longer be possible for my LTD company to make any SIPP payments)

The options I see at the moment are as follows:-

1. Take the PAYE option and take the hit from a finance perspective and also the risk of HMRC investigating my previous engagement.
2. Look for a an outside IR35 contract (given the market will be quite difficult to find)
3. Look for a permanent position – but not back at the current retailer initially.

I have tried to read a number of threads to try and comprehend some answers, but I'm really struggling - so excuse my post if you feel I've not done the right research !!

Many Thanks!!