Gladius Consulting

[cojak]

I believe that SA302's are required by most mortgage providers these days.

I do not believe that fireship is promoting anything, merely asking.

[captainham]

I believe that SA302's are required by most mortgage providers these days.

Indeed that seems to be the case, at least according to this firm: SA302 and mortgages for the self employed | amortgagenow

Thanks for that, useful to know.

Copied from the link above:

That SA302 phone number

Call 0845 900 0444

Ignore the first automatic option set
Select option 2 in the main menu set of options
Select option 5 in the third set of options
Wait patiently and a member of HMRC call centre staff will answer. They are a nice bunch and handle your query quite quickly once you get through.

[malvolio]

OK, I know that. But an umbrella user isn't Scehdule D self employed...

[Wanderer]

OK, I know that. But an umbrella user isn't Scehdule D self employed...

Could it be that this isn't actually a straight forward PAYE umbrella as we would understand it but one of these schemes that "we-could-tell-you-how-it-works-but-then-we'd-have-to-kill-you" that sets the contractor up as "self employed" and does some merry dance to avoid paying tax on their contract income?

How are we doing, Fireship? Getting warmer?

what makes me laugh about these schemes is that they are:

• Fully insured, underwritten by Lloyds of London
• Funds stay in the UK
• Immune to PSL problems
• No expenses required
• Proven for over 20 years
• QC Opinion
• Risk Free

Great so far. Also:

• House of Lords Confirmation
• Fully disclosed to HMRC

And yet:

"The sensitivity of the intellectual property behind what we do prevents us from providing full details on a public website."

Hang on, if it's cleared by the House of Lords then it should be in the public domain, no?

Fireship, the answer to queries about these schemes are always going to be that they are high risk. If you want to go ahead with it then don't let us stop you but I can't help but think that the SA302 is going to be the least of your worries...

[LisaContractorUmbrella]

If this is what I think it is the agency deals with the provider (Limited Company) and the provider then pays the self-employed individuals who avoid NI contributions other than voluntary. However, this does leave the provider at risk from debt transfer if the individual doesn't pay their taxes - the risk is somewhat offset because the provider is paid a percentage (3-5% typically) of the individual's earnings and leaves them to sort out their own tax

[Fireship]

Fire ship and Malvolio, no bickering in Professional forums.

Apologies cojak, forgot where I was for a moment there!

[Fireship]

I believe that SA302's are required by most mortgage providers these days.

I do not believe that fireship is promoting anything, merely asking.

Thanks Cojak, correct on both counts!!

Most major lenders will require hardcopy SA302’s from HMRC these days. Obviously there are firms out there without such a requirement however there seem to be less each day and their rates reflect the risk!

[Fireship]

Could it be that this isn't actually a straight forward PAYE umbrella as we would understand it but one of these schemes that "we-could-tell-you-how-it-works-but-then-we'd-have-to-kill-you" that sets the contractor up as "self employed" and does some merry dance to avoid paying tax on their contract income?

How are we doing, Fireship? Getting warmer?

Getting a lot warmer…

Basically I’m looking to future proof any mortgage applications as these days if you’re self-employed a lender will required SA302’s, an accountants letter is no longer acceptable.

Electronic copies generated at time of submission aren’t acceptable, instead it has to be a hardcopy requested from HMRC which may look completely different to any electronic copy you already have as HMRC have had time to review and challenge your return.

The kicker is that if HMRC disagree with your return (no matter how legit) then you can either cough up or ultimately end up in dispute. If you go down the dispute route then things become really interesting as at that point HMRC remove the income under dispute from your SA302 until such time any legal action has run its course. Assuming the disputed earnings are significant (and span several years) this gives a very different view of your earnings to any lender as they don’t have any indication of gross earnings only any net which HMRC have accepted for the period in question!!!!!

Given that any dispute with HMRC can be a lengthy process possibly stretching into years then it puts the tax payer in a very difficult position!! Assuming you’re making a legitimate claim and not taking the p..s, should HMRC disagree then you’re in a very difficult position, effectively you’re forced to roll over and part with cash which HMRC may ultimately not be entitled to or face a period of hardship due to inability to secure lending! Pretty worrying as it seems HMRC can challenge anything they like these days!!!

I’m not looking to use Galdius as such, more a general question regards options available, how they work, are they fully disclosed and returns accepted (hence cannot be reopened using disclosure)? For example umbrellas that rely on expenses could ultimately be caught as the expenses clamied by the provider may not be legit…. I guess ultimately I could go down the limited route but I believe that I would be caught by IR35 which is something I’d prefer to avoid!

[Wanderer]

I’m not looking to use Galdius as such, more a general question regards options available, how they work, are they fully disclosed and returns accepted (hence cannot be reopened using disclosure)?

When you check out these providers, ask them how much money you would retain from a contract income of £X/year.

When they come back and tell you it's (say) 85%, ask them how much of the 15% remainder goes to HMRC. If they won't give you a straight answer to that question, ask yourself why not. If the percentage is very low then ask yourself what HMRC are going to think of that.

There are lots of people here who run the gauntlet of IR35 but very few people admit to using these aggressive tax avoidance schemes. I think a tax avoidance scheme is your highest risk option.

I guess ultimately I could go down the limited route but I believe that I would be caught by IR35 which is something I’d prefer to avoid!

If you want to go LTD then there are lots of professionals (including the PCG) who can help assess your situation and advise you on how to proceed. You can even get TLC35 insurance to cover your losses should you get investigated. If they are willing to underwrite the risk then I'd say go right ahead. This is your moderate risk option.

For example umbrellas that rely on expenses could ultimately be caught as the expenses clamied by the provider may not be legit….

You are reading far too much into this.

If you want an easy life then go with one of the reputable umbrellas where you pay PAYE. Find one with an openly stated and clearly defined expenses policy and go right ahead and claim everything you can within the rules.

Yes, they do let you offset a surprising number things against your income but they ARE working within the rules or they would have been shut down by now. This is your low risk, low hassle option.

Choose wisely.

[LisaContractorUmbrella]

Wit regard to your point about expenses through an umbrella company - what you claim as expenses should not differ whichever company you use provided that they are working compliantly, as what is, or is not, a legitimate expense can only be determined by HMR&C