Okay Guys and Girls
I have been reading the recent threads with great interest, especially your thoughts on IR35, Ltd Companies and Umbrellas companies.
5 months ago I was hit with a £16000 tax bill from "Hector" as you all like to call him, due to the fact that I ignored and did not understand the IR35 rules. Even after advice from my agency who told me I was running the risk of being investigated, and that I should look at other solutions, did I still not head the warning. I have for the last 5 months read extensively and throughly the IR35 ruling, I have been keeping upto date with certain cases that are going on in the contract industry in the hope that some ruling, or a case may be won where I can actually challenge "Hector" again and reclaim my hard earned money back.
My advice to you all, do not set up your own limited company, this is exactly why the IR swooped all over me, Minimum Wage/Dividends, Salary/Dividends are going to come back to haunt us all. There is a case going on at the moment called the "Artic Case", where the IR have challenged a Husband and Wife, who were claiming Salary/Dividends They have already lost twice and it is a forgone conclusion that the IR will win. My advice to anyone who is out there currently getting S/D or MW/D, is to change and change now.
I have been in IT for 15 years, and I have not been working for the last 8 months, I have in the last 4 weeks just gone back to work. I have investigated every possible angle and avenue to get the very highest return on my income. You will find that most contracts fall Inside IR35, unless you are working with your own materials, on a fixed cost project, and you have a Right to Substitution (although is effectively a death blow, as really no client is going to agree to you sending someone else in your place if they have no knowledge of there pedigree), and this can automatically kill your self employed status stone dead.
I am now very reluctantly joining an Umbrella/Payment Solution company and now that my knowledge of IR35 is on par with the employees of the Inland Revenue, I have an excellent head start into choosing the best one. I have so far investigated nearly 15 companies. I have been amazed at how companies such as Giant, JSA, SJD, Brooksons, ICS, Orange & Gold, Orange Genie still offer contractors Salary and Dividends, knowing that any minute now this could effectively blow up in our faces. My advice DO NOT use these Umbrellas. Then we have our P4 friends, how they maintain to be a business is beyond me, there solution is a low return, badly run, rude and offensive policy, there hidden small print really should be appauled for the absolute cheek of it.
To date I have been left with 2 companies called Parasol IT and No Longer Limited. Both offer absolute watertight solutions in respect to IR35, both give good returns on our salary and both are a far safer and better solution then starting your own Ltd Company, S/D, MW/D, Offshore accounts etc.......
Hector is out to get us all, and I am conclusive proof that this is the case, I was bitten and bitten hard, and it has taken me a long period of time to deal with this, probably 2 years in total, and I lost, I lost legal fees, my own money, the contract I was working at the time, all in al it has probably cost me the best part of £30,000 out of my pocket.
There are Umbrella's out there who much as I begrudge saying it, do offer us a good and legal service. I would never have my own limited company again for the sake of paying £30-£40 a week, I suggest you all don't too.
I have been reading the recent threads with great interest, especially your thoughts on IR35, Ltd Companies and Umbrellas companies.
5 months ago I was hit with a £16000 tax bill from "Hector" as you all like to call him, due to the fact that I ignored and did not understand the IR35 rules. Even after advice from my agency who told me I was running the risk of being investigated, and that I should look at other solutions, did I still not head the warning. I have for the last 5 months read extensively and throughly the IR35 ruling, I have been keeping upto date with certain cases that are going on in the contract industry in the hope that some ruling, or a case may be won where I can actually challenge "Hector" again and reclaim my hard earned money back.
My advice to you all, do not set up your own limited company, this is exactly why the IR swooped all over me, Minimum Wage/Dividends, Salary/Dividends are going to come back to haunt us all. There is a case going on at the moment called the "Artic Case", where the IR have challenged a Husband and Wife, who were claiming Salary/Dividends They have already lost twice and it is a forgone conclusion that the IR will win. My advice to anyone who is out there currently getting S/D or MW/D, is to change and change now.
I have been in IT for 15 years, and I have not been working for the last 8 months, I have in the last 4 weeks just gone back to work. I have investigated every possible angle and avenue to get the very highest return on my income. You will find that most contracts fall Inside IR35, unless you are working with your own materials, on a fixed cost project, and you have a Right to Substitution (although is effectively a death blow, as really no client is going to agree to you sending someone else in your place if they have no knowledge of there pedigree), and this can automatically kill your self employed status stone dead.
I am now very reluctantly joining an Umbrella/Payment Solution company and now that my knowledge of IR35 is on par with the employees of the Inland Revenue, I have an excellent head start into choosing the best one. I have so far investigated nearly 15 companies. I have been amazed at how companies such as Giant, JSA, SJD, Brooksons, ICS, Orange & Gold, Orange Genie still offer contractors Salary and Dividends, knowing that any minute now this could effectively blow up in our faces. My advice DO NOT use these Umbrellas. Then we have our P4 friends, how they maintain to be a business is beyond me, there solution is a low return, badly run, rude and offensive policy, there hidden small print really should be appauled for the absolute cheek of it.
To date I have been left with 2 companies called Parasol IT and No Longer Limited. Both offer absolute watertight solutions in respect to IR35, both give good returns on our salary and both are a far safer and better solution then starting your own Ltd Company, S/D, MW/D, Offshore accounts etc.......
Hector is out to get us all, and I am conclusive proof that this is the case, I was bitten and bitten hard, and it has taken me a long period of time to deal with this, probably 2 years in total, and I lost, I lost legal fees, my own money, the contract I was working at the time, all in al it has probably cost me the best part of £30,000 out of my pocket.
There are Umbrella's out there who much as I begrudge saying it, do offer us a good and legal service. I would never have my own limited company again for the sake of paying £30-£40 a week, I suggest you all don't too.
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