IR35 fine - advice please!

ISWMLE

quietriot wrote: »

I suspect you are mental.

I KNOW you are a insulting prat.

ISWMLE

Pennywise wrote: »

Jaw-droppingly nonsense I'm afraid.

What about the few hundred pounds per quarter profit that an average PSC can make from being VAT registered under the flat rate scheme? Not available under an umbrella.

What about telephone, insurance, office costs, equipment purchases, professional fees, that can attract tax relief for corporation tax, otherwise payable on the remaining 5% expense allowance? None of that tax-relievable if working under an umbrella.

What about the company providing "benefits in kind" such as a company car, BUPA, etc., which are allowable expenses (BIK values for deemed payment) under IR35 so can be paid by the company to get tax tax relief. Yes, taxable benefits on the worker, but the tax/nic on the BIK can be substantially less than the IR35 tax/nic if no such expenses meaning more paid under PAYE/NIC via direct payroll/deemed payment.

What about pensions? Massive saving in NIC if the company makes employers' contributions compared to the worker themselves paying pension personally out of "after tax and NIC" income?

What about the worker who's hit the 2year deadline and can't claim travel costs anymore, neither under a ltd nor an umbrella? If he's caught by IR35, the company buying him a car and fuel as BIKs works well as the company claims the costs providing and running the car. Yes, the worker suffers the BIK, but if the travelling costs are high (work along way from home), overall they save money due to tax relief and lower BIK tax/NIC than otherwise having to fund the travel personally out of "after IR35" net pay!

If the 5% allowances aren't fully covered, surplus can be built up in the company (having paid only 20% CT rather than 50/60% plus tax/nic) and either carried forward or paid out as dividends without nic. Scope to build up for several years to be paid out in future years at a lower tax rate.

Plenty of tax planning opportunities available to people caught by IR35 that makes the limited company option worthwhile and a better option than rolling over and accepting using an umbrella instead (or suffering a lack of imagination and not thinking about all the planning opportunities available for a PSC caught by IR35!).

I've had many clients over the years who've been caught by IR35 and made the best of a bad job by adoption of the above, and other, tax planning opportunities, thus saving significant amounts of tax/NIC that would have been lost forever had they used an umbrella or blindly accepted IR35 without these kind of planning techniques being deployed!

.......except the usual tax deductable allowances the government permits.

Can't you read? All you have talked about above are government permitted allowances.

I am not in favour of umbrella companies either. Read my posts.

chrismac1

"My advice to some of the other posters in this thread is that if you are in a hole, it is a good idea to stop digging."

This advice would be especially useful for the last poster.

quietriot

ISWMLE wrote: »

I KNOW you are a insulting prat.

*an

Is English not your first language?

mizzy85

Hi there. I'm sorry to hear about this and I really hope you are able to sort it out soon.
I am taking a year out next year and will also be a locum doctor. I have considered going as a Ltd company, but this IR35 legislation issue is very off putting.

Do you mind asking - what level were you at during your locum doctor years e.g. SHO, Spr?

Thank you, and I really hope you sort it all out. I would definetly seek legal advice for a lawyer who specialises in IR35, not an accountant (based on what I have read from my IR35 research).

Best of luck.