Assignments “Inside IR35”

So we are all seeing posts about who is liable to employment payments, whether uplifts need to be provided or whether contract rates are deemed acceptable to provide to the contractor.

Well if the client determines that an assignment is “inside IR35”, you need to understand what options are available in terms of an alternative to an off-payroll model.

The options are:

PAYE payroll (agency workers)
Where a recruitment business contracts directly with the worker and operates tax and NICs under agency rules and provides the workers with worker rights – the off-payroll working rules DO NOT apply.

Pay rate should be quoted as TAXABLE SALARY.

Umbrella Company
Where an umbrella company employs the worker directly, the off-payroll working rules DO NOT apply.

Pay rate should be quoted as CONTRACT RATE.

“Inside IR35” PSC
Should you wish to continue to engage as a contractor via your PSC who is deemed “inside IR35”, your recruiter will need to calculate a “deemed employment payment” using the RTI (Real Time Information) payroll system. The deemed employment pay rate is the income of the worker after deductions, including both employee and employer NICs and the Apprenticeship Levy. Neither worker rights nor stakeholder pension rights apply. No expenses allowance applies. The off-payroll working rules DO apply.

Pay rate should be quoted as TAXABLE SALARY.

Image by Gerd Altmann from Pixabay

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