Inside IR35 - Which is the best umbrella company to ensure compliance

[bromleygirl]

After 5 years away, I am returning to being a contractor in 2 weeks and the landscape has changed so much! I will be inside IR35 and cannot use a limited company, therefore I either need to be "employed" through an umbrella company or through the agency directly but with a lower daily rate.

I'd prefer to be under an umbrella to retain control over the process and maintain my daily rate but with so many of them and all seem to be processing pay differently it is proving to be a huge minefield..I need to ensure tax compliance but want to if I can maximize my net take-home pay. I've been recommended one umbrella company that splits the payment between min PAYE with a second payment via capital gains that I would ultimately pay capital gains tax on but instead of retaining around 55% of my contract value, I would be retaining around 70 - 75% of the value. I'd also like an umbrella company that I can have my salary sacrifice pension contributions paid to a private pension before tax to help reduce my tax liabilities if I chose to go down the road of a more traditional, PAYE umbrella company.

With the FSCA holiday pay scandal, I really need to find a legit, good value and ethical umbrella company. Does anyone have any suggestions please?

[cojak]

'maximize my net take-home pay' and 'legit umbrella' are mutually exclusive I'm afraid. You can forget the '70% take home ' crowd as well.

If you are inside HMRC expects to receive that 47%.

Clarity is the general recommendation, and I think Orca and Fair Paye(?) are in the mix too.

[eek]

Clarity and Orca are good (not opus but I can see where Cojak gets confused).

There will be others I can add but not quite yet.

Fairpay may be suitable but I don't know how they handle salary sacrifice into a pension (mainly because I've never asked Adam).

Money wise a legitimate umbrella will pay you 55% or so of the invoice rate.

That can be lifted up to 70%+ via salary sacrifice into a pension if you don't need the money.

[northernladuk]

I'd say go to Clarity. I've been with Lucy before and very pleased with the service. She posts on here regularly and is on top of all the goings on so she would be my first port of call all day long.

The only issue you might find is not many agents allow you to pick your own brolly. If you can then happy days but don't put too much legwork in until you find out.

[bromleygirl]

I'd say go to Clarity. I've been with Lucy before and very pleased with the service. She posts on here regularly and is on top of all the goings on so she would be my first port of call all day long.

The only issue you might find is not many agents allow you to pick your own brolly. If you can then happy days but don't put too much legwork in until you find out.

Thanks and great point - the agency has 5 umbrellas on their PSL but I've challenged the need to go with 1 of their preferred suppliers just for the sake of making it easier for the agency as they have already got contracts and invoice mechanisms in place with the PSL umbrellas. I should be free to choose which umbrella I want as long as it's compliant as ultimately the umbrella acts as my employer. I'll contact Lucy at Clarity and ask if they can do the salary sacrifice.

[bromleygirl]

Clarity and Orca are good (not opus but I can see where Cojak gets confused).

There will be others I can add but not quite yet.

Fairpay may be suitable but I don't know how they handle salary sacrifice into a pension (mainly because I've never asked Adam).

Money wise a legitimate umbrella will pay you 55% or so of the invoice rate.

That can be lifted up to 70%+ via salary sacrifice into a pension if you don't need the money.

Thanks - Any suggestions for umbrellas that will do salary sacrifice? I think that's the way I'm going to go with this - be compliant and stash as much as I can before take into pensions!

[malvolio]

Thanks and great point - the agency has 5 umbrellas on their PSL but I've challenged the need to go with 1 of their preferred suppliers just for the sake of making it easier for the agency as they have already got contracts and invoice mechanisms in place with the PSL umbrellas. I should be free to choose which umbrella I want as long as it's compliant as ultimately the umbrella acts as my employer. I'll contact Lucy at Clarity and ask if they can do the salary sacrifice.

Define "compliant" from the agency perspective. They are not known for the standards of Due Diligence and many seem to think FCSA certification and an enormous client base is sufficient. It isn't...

[northernladuk]

Thanks and great point - the agency has 5 umbrellas on their PSL but I've challenged the need to go with 1 of their preferred suppliers just for the sake of making it easier for the agency as they have already got contracts and invoice mechanisms in place with the PSL umbrellas. I should be free to choose which umbrella I want as long as it's compliant as ultimately the umbrella acts as my employer. I'll contact Lucy at Clarity and ask if they can do the salary sacrifice.

It isn't just mechanisms. They will argue they've spent time and money doing the diligence to on board them first. The one time I went with an agent they cited this and we've evidence of the same in other brolly choice questions. Some won't budge but didn't take much more than another email saying I appreciate that but would still like progress with Lucy. A few days later and away we go.

I'm sure Clarity do sacrifice.

[eek]

It isn't just mechanisms. They will argue they've spent time and money doing the diligence to on board them first. The one time I went with an agent they cited this and we've evidence of the same in other brolly choice questions. Some won't budge but didn't take much more than another email saying I appreciate that but would still like progress with Lucy. A few days later and away we go.

I'm sure Clarity do sacrifice.

Clarity and Orca do, as I said Fairpay is an unknown simply because I've never asked.

[bromleygirl]

Clarity and Orca do, as I said Fairpay is an unknown simply because I've never asked.

Thank you Everyone, really appreciate all of the recommendations - Does anyone happen to have any experience of PayStream?