Impala Solutions Limited has been created for you.
IR35 is due to come into effect from 6 April 2021, this legislation impacts limited companies and how you are classed for tax purposes.
The company that you work for decides on your IR35 status, if in any doubt, please discuss this with the companies you contract for.
What does ‘inside IR35’ mean?
If your contract is deemed inside IR35, you are considered an employee for tax reasons. This means tax and national insurance are due at the same rate as an employee in the same tax bracket.
Like many things related to IR35, calculating the ‘deemed payment’ is complex. This is why, in many cases, contractors seek professional help in doing so.
Tax and employment legislation are currently separate. So, whilst you may be considered an employee for tax purposes, you are not automatically entitled to employment rights.
IR35 introduces employment rights for individuals now deemed as employees including, statutory sick pay, maternity pay, paternity pay, holiday pay etc.
What does ‘outside IR35’ mean?
If your contract is deemed outside IR35, you are considered self-employed for tax purposes and are free to pay yourself in the most tax efficient way, which is typically through a mixture of salary and dividends taken from your limited company.
Contractors working outside the scope of IR35 are responsible for making sure all their personal and company taxes are calculated correctly and paid on time.
Please see the below calculator to check your employment status for tax purposes (this is only a guide, your final status is decided by the company/ies you contract to):
3 key tests have been devised that are important factors in deciding your IR35 status:
Personal Service
- Is the service you provide to your client a personal one or a business-to-business service?
- Do you have the right to provide a substitute worker to perform the duties
Control
- To what extent do you control the services carried out.
- Are you under direct control of your client or can you dictate the work carried out?
Mutuality of Obligation
- Is there an obligation for the client to provide constant and paid work, if so are you obliged to accept this work?
Introducing our solution - Impala Solutions Limited.
These are the main benefits of contracting through Impala Solutions Limited:
Quick and easy set up
No set-up costs and no lengthy admin processes. If you think that you will only be contracting for a short period of time then umbrella contracting is the fastest, most efficient way to get paid.
Minimal admin
Simply submit a timesheet and we will collect your money and pay you, leaving you free to concentrate on more important things.
Do not worry about IR35
If you are caught by IR35, there may be nothing to gain by setting up a limited company. We are fully tax compliant, and you get extra benefits, like full statutory employment rights.
Expenses
HMRC rule changes in 2016 mean that it is harder for employees to claim expenses, but workers who are not subject to ‘supervision, direction or control’ by clients, or workers who visit multiple sites in a day, can still claim money back for expenses like travel, food, and accommodation. These rules are complicated and online tools can be unreliable. It is a good idea to speak to us to get information or advice about any expenses.
How we work
We essentially sit between you and the client (which can be an agency or an end client). You will become an employee with us. We will raise invoices on your behalf and pass the proceeds onto you as a salary, after retaining a margin and deducting taxes in line with what you would pay in any other kind of traditional employment. All statutory deductions are passed to HMRC on your behalf. All you need to do is submit a weekly or monthly timesheet and we will handle everything else.
You would be signing an employment contract with us. We will sign a contract with your employment agency or client and submit your timesheets to them weekly or monthly. We will raise invoices based on your timesheets (if required by your agency or client). Your salary will be paid directly into your personal bank account once taxes have been deducted and margin retained.
To Book an Appointment to discuss your circumstances in more detail, with the view to joining Impala Solutions Limited, contact us today.