Originally posted by NotAllThere
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Under IR35 - Capita is charging me Apprenticeship Levy Tax
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merely at clientco for the entertainment -
Originally posted by nelsonswork View PostStructure is: Public Sector Client -> Capita -> My LTD Company -> Me
I think it's important to clarify that this is different to being contracted to Capita to deliver a project that happens to be for a public sector client... Right, right?!?!
Right?Comment
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Capita is behaving as agency and payroll service provider in this instance, so all looks above board to me as per Eek's explanation of what is going on.
Myself, I've confirmed that the rate I was offered by the client when tempting me back to PS is exactly the same as what the payroll service of the chain (yet to be sorted out) will receive from the agency, that Capita said I would need (not willing to be agent themselves for some reason).
So any fees that Capita and the agency are charging to be in the chain will be handled by the client and any fees the payroll service will charge/deduct (including tax and levy) will come out of the rate I am expecting. Hence the client agreeing a rate increase of 30%+ to cover me being inside IR35 when previously I was outside.Maybe tomorrow, I'll want to settle down. Until tomorrow, I'll just keep moving on.Comment
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Originally posted by eek View PostCapita are therefore deducting the appropriate payments as the levy is based on employers NI payments and Capita is responsible for paying the employers NI part of your IR35 payments. See https://www.gov.uk/guidance/pay-apprenticeship-levy for the rules on how the apprenticeship levy is paid
And to avoid any avoidance lets show how an IR35 contract is now paid:-
Employers NI deducted from the invoice and paid by the agency directly
Employees NI paid on your behalf by the agency
Income Tax paid on your behalf by the agencyComment
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Originally posted by nelsonswork View PostThanks, my companys payroll is not more then 3 million and thus I should not pay the Apprenticeship Levy how ever Capita is debucting it before the payment to my company alongside Employers NI.
Just because Capita have to pay it does not give them the automatic right to pass that cost onto you.Comment
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Originally posted by nelsonswork View PostThanks, my companys payroll is not more then 3 million and thus I should not pay the Apprenticeship Levy how ever Capita is debucting it before the payment to my company alongside Employers NI.
TF also states that Capita may not have the right to deduct fees from your contract - I strongly suspect that isn't the case as you are not complaining about Employer NI deductions, just the Apprenticeship levy - but its worth checking.merely at clientco for the entertainmentComment
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Originally posted by eek View PostThe public sector IR35 means that its not your company's responsibility to pay Employers NI but Capita (or whatever agency is the last party in the chain before your limited company) - and Capita definitely have a payroll over £3m.... To avoid paying the levy you need to use either an umbrella company or be working via an agency with a payroll of less than £3m...
TF also states that Capita may not have the right to deduct fees from your contract - I strongly suspect that isn't the case as you are not complaining about Employer NI deductions, just the Apprenticeship levy - but its worth checking."Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.Comment
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Originally posted by DaveB View PostGoing brolly doesn't get you out of the levy. Lucy has confirmed elsewhere that Brolly's will be charging the levy to their contractors as well. If you are working through a Brolly via Capita then the brolly will deduct the levy instead of capita as the last payer in the chain.merely at clientco for the entertainmentComment
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Thanks
Thanks for the feedback. It looks like I'm stuck paying this. I did negeoate more mony for this contract. It does not come anywhere close to the extra amount of taxes for IR35. I will pay 36%-40% tax now on all my income. I also still have compture equipment, software, hosting, insurance and accountant to pay. I now pay more tax then a avarge employee by at least 14%. Dosn't pay to contract with the goverment.Comment
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Originally posted by nelsonswork View PostThanks for the feedback. It looks like I'm stuck paying this. I did negeoate more mony for this contract. It does not come anywhere close to the extra amount of taxes for IR35. I will pay 36%-40% tax now on all my income. I also still have compture equipment, software, hosting, insurance and accountant to pay. I now pay more tax then a avarge employee by at least 14%. Dosn't pay to contract with the goverment.Comment
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