MegaSack DRAW - This year's winner is user - rgwb
We will be in touch
Bugger. Online calcs show around £11-13k loss in income due to me having to fork out employers NI and losing my travel allowance 17 months earlier.
Been trying to find out if I can still not draw down all my salary from the IR35 affected contract as my plan was to use some money from this contract to invest in equipment for my other R&D based work.
I am a ltd company working through an agency to a public sector body.I understand the agency may be paying me via PAYE so all the deductions will be getting done before I see the money which screws up my plans of working my ass off for the next couple of years to build up my resources as my work outside of this contract is quite cap-ex heavy needing bespoke processing equipment and test rigs.
Are you going to continue in your existing contract and effectively move from being "outside IR35" to "inside IR 35" ?
If so, not concerned about a HMRC inquiry into your tax affairs for the previous "outside IR35" part ? After all, why wouldn't they do that.
What bit of can't claim t&e when inside IR35 did you miss, announced in 2015 for April 2016?
+1 dangers of staying with the same client
"[i]Been trying to find out if I can still not draw down all my salary from the IR35 affected contract ...[/i]"
AFAIK, no, you can't. It's effectively treated just like PAYE and tax/NI gets deducted from the total invoice value. If you're wholly inside IR35 I'm not sure there's even any point being a ltd company any more.
I can see a lot of smugness on the horizon from those who manage to weasel themselves an "out" position...
Just educate me on what happened , i thought the IR35 principle limitation was working for two years? Hence disguised employees etc etc
I think its the agency/public body bit that's going to prove difficult to change there. Direct work as a Ltd might give you the chance to negotiate rights of substitution and output based payment, but that's not the same as having the work now.
Does the rate offer potential for adjustment to compensate?
Assuming ir35 is correctly applied I think that's a bit of a dead end - if you are convinced otherwise there might be a way to offset when you come to do your tax return I guess (if the paye were deducted at source incorrectly).
Charge more
Stop working for that client and make sure you get paid before 6th April.
Ensure any future contract is outside.
[quote=yourguitarhero ]Charge more
No good if already working on a public sector contract though. Best option is to get out and ensure final invoice is paid before 6th April (as above).
What bit of can't claim t&e when inside IR35 did you miss, announced in 2015 for April 2016?
I wasnt originally supposed to be inside IR35. It was determined we were outside. Not they are having a rethink based on how roles are panning out. Forr the last 6 years I have been very much outside of IR35, including with this company coming in on a very defined piece of work with a breif and then I go away and do it how I want and they use the results/advice from that.
If so, not concerned about a HMRC inquiry into your tax affairs for the previous "outside IR35" part ? After all, why wouldn't they do that.
That has crossed my mind. Only been with this client for this stint since September, contract was renewed after 6 months. Before that I was a sole trader very much outside of IR35 working very independently.
In all honesty I was originally brought in to be very independent on a couple of contracts. Those contracts have now been completed but they wanted to keep me on for some more but there is an aspect of learning etc on the job as it's R&D rather than me coming in and telling them stuff like before. That said I am not really supervised and I refused to take on any supervisory roles.
Does the rate offer potential for adjustment to compensate?
I doubt it. It would be nice if they offered to pay the employer NI bit which would split the reduction.