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Previously on "Ltd better than umbrella even if inside IR35?"
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In addition to that post by Wanderer, if an analysis shows you're potentially outside IR35 then a prudent course of action would be to act outside IR35 but pay yourself inside it. Calculate exactly what you'd be paying yourself net inside and outside IR35 as a complete package then stick the difference into a savings account, bond or other savings mechanism somewhere. Seven years later (6 year legal time plus the 1 year filing time), use the money for that year for a nice treat for yourself.
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Originally posted by MB1983 View PostI currently work through an umbrella company, but would like to establish whether I could increase the % of earnings by starting a Ltd company.
On the positive side, you will have control of your income through your own company and there are other possibilities for tax planning like contributing to a pension.
Originally posted by MB1983 View PostThe problem is that I feel that my line of work means that I'll always be inside IR35.
If the reviewers find that you are outside IR35 then take a deep breath, get yourself a LTD company, an accountant with a decent book keeping system and an insurance policy that covers you for an IR35 investigation and taxes owed.
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Originally posted by MB1983 View PostI currently work through an umbrella company, but would like to establish whether I could increase the % of earnings by starting a Ltd company. The problem is that I feel that my line of work means that I'll always be inside IR35. I work in analytics/statistics and would tend to apply for contracts like 'data analyst', 'BI/MI analyst', 'reporting analyst', etc. Most of these roles seem like they're basically a temporary version of a permanent job. In my last contract, for example, I was basically standing-in while a perm was recruited - I felt kind of like a 'temp' but on better money. From what I understand of IR35 it doesn't seem that I could be outside it. If this is the case, is it still beneficial to have a Ltd company or will I earn roughly the same as with an umbrella company?
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Originally posted by MB1983 View PostI currently work through an umbrella company, but would like to establish whether I could increase the % of earnings by starting a Ltd company. The problem is that I feel that my line of work means that I'll always be inside IR35. I work in analytics/statistics and would tend to apply for contracts like 'data analyst', 'BI/MI analyst', 'reporting analyst', etc. Most of these roles seem like they're basically a temporary version of a permanent job. In my last contract, for example, I was basically standing-in while a perm was recruited - I felt kind of like a 'temp' but on better money. From what I understand of IR35 it doesn't seem that I could be outside it. If this is the case, is it still beneficial to have a Ltd company or will I earn roughly the same as with an umbrella company?
Running a company is not just about financial returns though - if you are thinking about going Ltd look into what your responsibilities will be, speak a good specialist accountant who understands the industry and IR35 and then decide if that's the route that you want to take
HTH
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Ltd better than umbrella even if inside IR35?
I currently work through an umbrella company, but would like to establish whether I could increase the % of earnings by starting a Ltd company. The problem is that I feel that my line of work means that I'll always be inside IR35. I work in analytics/statistics and would tend to apply for contracts like 'data analyst', 'BI/MI analyst', 'reporting analyst', etc. Most of these roles seem like they're basically a temporary version of a permanent job. In my last contract, for example, I was basically standing-in while a perm was recruited - I felt kind of like a 'temp' but on better money. From what I understand of IR35 it doesn't seem that I could be outside it. If this is the case, is it still beneficial to have a Ltd company or will I earn roughly the same as with an umbrella company?Tags: None
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