Sure it's been asked lots of times but why do agencies insist that I contract through a ltd co or an umbrella co? I run my own business as a sole trader and am happy to invoice/pay tax/NI as a sole trader. Why can't I contract as a sole trader? Thanks
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Contracting as a sole trader
Collapse
X
-
-
Originally posted by bikeman View PostSure it's been asked lots of times but why do agencies insist that I contract through a ltd co or an umbrella co? I run my own business as a sole trader and am happy to invoice/pay tax/NI as a sole trader. Why can't I contract as a sole trader? Thanks -
Originally posted by bikeman View PostSure it's been asked lots of times but why do agencies insist that I contract through a ltd co or an umbrella co? I run my own business as a sole trader and am happy to invoice/pay tax/NI as a sole trader. Why can't I contract as a sole trader? Thanks'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
-
Originally posted by Clare@InTouch View PostTransfer of Debt Regulations. Agencies are concerned that if you don't pay your taxes the debt will be transferred to them.
The tax issue is a different reason introduced far later down the line.merely at clientco for the entertainmentComment
-
Originally posted by eek View PostActually its from Employment Protection (Consolidation) Act 1978 is the law we are looking at.
The tax issue is a different reason introduced far later down the line.Comment
-
So it's against the law? But how is a contract obtained through a recruitment co (and requires a ltd co/umbrella) so different from a contract that I obtain directly and operate as a sole trader? What is the key differences between these contracts that causes it to be caught by this legislation?
I don't really understand the issue around agencies and tax. Whether I pay tax as an ltd co or a sole trader, they aren't responsible and have no visibility of it anyway.Last edited by bikeman; 6 September 2013, 11:08.Comment
-
Originally posted by bikeman View PostSo it's against the law? But how is a contract obtained through a recruitment co (and requires a ltd co/umbrella) so different from a contract that I obtain directly and operate as a sole trader? What is the key differences between these contracts that causes it to be caught by this legislation?
I don't really understand the issue around agencies and tax. Whether I pay tax as an ltd co or a sole trader, they aren't responsible and have no visibility of it anyway.
It's not the contract, it's the vehicle you're trading through. The regulations that allow debt to be transferred do not apply to a Ltd or a Brolly in the same way as they do to a sole trader (I've not read the actual legislation for a while, but that's the general gist)Comment
-
Originally posted by Clare@InTouch View PostIt's no illegal at all, agencies just don't want to allow it.
It's not the contract, it's the vehicle you're trading through. The regulations that allow debt to be transferred do not apply to a Ltd or a Brolly in the same way as they do to a sole trader (I've not read the actual legislation for a while, but that's the general gist)Blog? What blog...?Comment
-
Originally posted by Clare@InTouch View PostIt's no illegal at all, agencies just don't want to allow it.
It's not the contract, it's the vehicle you're trading through. The regulations that allow debt to be transferred do not apply to a Ltd or a Brolly in the same way as they do to a sole trader (I've not read the actual legislation for a while, but that's the general gist)Comment
-
Originally posted by bikeman View PostSo it's against the law? But how is a contract obtained through a recruitment co (and requires a ltd co/umbrella) so different from a contract that I obtain directly and operate as a sole trader? What is the key differences between these contracts that causes it to be caught by this legislation?
I don't really understand the issue around agencies and tax. Whether I pay tax as an ltd co or a sole trader, they aren't responsible and have no visibility of it anyway.
The issue around agencies and tax is entirely separate to that law. The fact that people assume its due to tax just shows the lack of knowledge most people and agencies have around this area. But as a clue:-
You can work for the BBC or any company directly as self employed provided the company is willing to accept you working in that way (many people won't and its a pointless exercise as a service company is more tax efficient).
That 1978 act stops an agency letting me be self employed while they pay me to work for a third party.merely at clientco for the entertainmentComment
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Comment