My current situation is I am an IT contractor who has my own Ltd company (with me as the only employee). I am currently contracting for a End Client through an agency and have been for circa 10 months (on this current contract). I provide a specific role as a Technical PM for a specific project. The agency sent out the following comms (finally) on the end clients plans for contract resources.
As of March 23rd all contractors will be engaged on a PAYE contract (only – no umbrella) through **Agency** or your supplying agency. We will be serving the 4 week notice on all current umbrella and Ltd company contracts (that run past the 22nd March) on the 21st February
So my initial questions around this are:-
1. I think I know the answer.... but if I were to engage, through my ltd company as a contractor, with another consultancy who are classed as a ‘small business’ and who have already got an MSA and carry out some work for the End CLient, would that be an option? I am effectively offering my services to the consultancy outside IR35 and they are providing a resource that they do not have to the Retailer. Does this fall under the new legislation and effectively mean the end client, are responsible for accessing whether I am outside IR35 ? If so – as the end client has stipulated they will only engage contractors on a PAYE basis – given this, I assume they will not take this as a feasible option.
2. My current contract ceases on 01/03/2020 – so payment on my final invoice should be made before April. Assume there is no issue with this, given I do not extend my contract any further.
3. Should I choose to go down the PAYE option with the same Retailer:-
- Does this not effectively say, I am inside IR35 and have always been for the previous 10 months and there is a risk that HMRC could look at my previous history and deem I owe them some more tax
- If I was to go down the PAYE option – but as a different role – say Consultant – does this mitigate the above risk
- I am quite embarrassed to ask this question, but how do I work out what the effective hit from a ‘money in my pocket’ was if I went down the PAYE route.
- As the PAYE options still stipulates that it needs to be done through an Agency – I assume my PAYE will be with the agency and they will take off any tax requirements before paying me
- Does the PAYE option effectively mean a Fixed Term contract with holiday payment, statutory sick pay, pension, no benefits etc ( I currently pay into a SIPP and assume this will no longer be possible for my LTD company to make any SIPP payments)
The options I see at the moment are as follows:-
1. Take the PAYE option and take the hit from a finance perspective and also the risk of HMRC investigating my previous engagement.
2. Look for a an outside IR35 contract (given the market will be quite difficult to find)
3. Look for a permanent position – but not back at the current retailer initially.
I have tried to read a number of threads to try and comprehend some answers, but I'm really struggling - so excuse my post if you feel I've not done the right research !!
Many Thanks!!
As of March 23rd all contractors will be engaged on a PAYE contract (only – no umbrella) through **Agency** or your supplying agency. We will be serving the 4 week notice on all current umbrella and Ltd company contracts (that run past the 22nd March) on the 21st February
So my initial questions around this are:-
1. I think I know the answer.... but if I were to engage, through my ltd company as a contractor, with another consultancy who are classed as a ‘small business’ and who have already got an MSA and carry out some work for the End CLient, would that be an option? I am effectively offering my services to the consultancy outside IR35 and they are providing a resource that they do not have to the Retailer. Does this fall under the new legislation and effectively mean the end client, are responsible for accessing whether I am outside IR35 ? If so – as the end client has stipulated they will only engage contractors on a PAYE basis – given this, I assume they will not take this as a feasible option.
2. My current contract ceases on 01/03/2020 – so payment on my final invoice should be made before April. Assume there is no issue with this, given I do not extend my contract any further.
3. Should I choose to go down the PAYE option with the same Retailer:-
- Does this not effectively say, I am inside IR35 and have always been for the previous 10 months and there is a risk that HMRC could look at my previous history and deem I owe them some more tax
- If I was to go down the PAYE option – but as a different role – say Consultant – does this mitigate the above risk
- I am quite embarrassed to ask this question, but how do I work out what the effective hit from a ‘money in my pocket’ was if I went down the PAYE route.
- As the PAYE options still stipulates that it needs to be done through an Agency – I assume my PAYE will be with the agency and they will take off any tax requirements before paying me
- Does the PAYE option effectively mean a Fixed Term contract with holiday payment, statutory sick pay, pension, no benefits etc ( I currently pay into a SIPP and assume this will no longer be possible for my LTD company to make any SIPP payments)
The options I see at the moment are as follows:-
1. Take the PAYE option and take the hit from a finance perspective and also the risk of HMRC investigating my previous engagement.
2. Look for a an outside IR35 contract (given the market will be quite difficult to find)
3. Look for a permanent position – but not back at the current retailer initially.
I have tried to read a number of threads to try and comprehend some answers, but I'm really struggling - so excuse my post if you feel I've not done the right research !!
Many Thanks!!
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