Umbrella Company Articles

How do umbrella companies avoid IR35?

Umbrella companies allow contractors to achieve IR35 compliance. If a limited company contract is deemed ‘inside IR35’, contracting through an umbrella company is usually preferable.

This will become more important as an upcoming rule change will mean that many more contractors are caught out by IR35 legislation.

comparing umbrella companies
marketing | 12 May 2020
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New HMRC research has revealed that some of the most attractive ‘umbrella’ deals on comparison and broker websites aren’t tax-compliant, meaning they could land you with a big bill further down the line.

The companies that come out on top of these comparison listings usually boast unbelievable take home pay figures, together with other ‘too good to be true’ advantages. In reality, the only way umbrella companies can achieve these ‘enhanced’ or ‘advanced’ rates is through tax avoidance.

Remember, YOU are responsible for paying the right amount of tax. The tax man will come after YOU if you try and cheat the system. And if a deal sounds too good to be true, YOU know that it probably is.

At Umbrella.co.uk, we’re proud of our track record of protecting clients through compliance. We’re accredited by the FCSA and APSCo, two of the largest and most prestigious staffing and employment bodies. We have also been approved as business partners by the Recruitment and Employment Confederation (REC).

What expenses can limited company contractors claim

If you contract through a limited company, there are certain expenses that you can claim against your income to reduce your tax liability.

If your limited company makes £50,000 and you claim back £10,000 in allowable expenses, the taxable profit will be £40,000.

There are some rules governing what expenses limited company contractors can claim.

Government seeks views on IR35 non-compliance in the private sector

The government wants to hear from you as part of an attempt to tackle IR35 non-compliance in the private sector.

It comes after changes to IR35 rules in the public sector caused problems public authorities and contractors

Also known as off-payroll working, IR35 rules are designed to stop employees working and paying taxes as if they were contractors.

The rules apply to contractors working through personal service companies who, if they were engaged directly by the company, would effectively be employees.

‘Too good to be true’ payment scheme users risk bankruptcy
marketing | 30 October 2017
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A recently concluded court case could have far-reaching consequences for contractors on ‘too good to be true’ tax avoidance schemes.

In a warning sign to contractors that are thinking about using a dodgy ‘too good to be true’ remuneration scheme, MPs have been told that users of one type of tax avoidance scheme could risk bankruptcy in the near future.

The charge centres on a recently concluded Supreme Court Case between Rangers Football Club and HMRC and a tax avoidance scheme where an offshore Employee Benefit Trust (EBT) paid players and other staff through loans. 

Getting back to business in the office

We’re still at home – and still working for you!!  But from Monday most of the team will be back in our offices, observing the rules, and looking forward to picking up where we left off before we rudely interrupted by a pandemic, with our first class, friendly service!!

If any of our agency partners would like some virtual team training or are just missing our faces, our business development team is available to support you.

Here are some more of our friendly faces working from home for you.

One-in-Five Sole Traders Needlessly Preparing for IR35 Reforms

New research indicates that one-in-five UK sole traders are preparing for the upcoming changes to off-payroll working rules in the private sector, despite the fact that the legislation will not affect them.

Completed by the Freelancer & Contractor Services Association (FCSA) professional body and cloud accounting software provider FreeAgent, the research found that 18% of sole traders were making preparations for the new rules when they would not affect their business type.

Another Dividend Tax Grab This Autumn?

Chancellor Philip Hammond has been urged not to ‘clobber’ limited company contractors and other businesses with another dividend tax grab this autumn.

The Federation of Small Businesses (FSB) said it was concerned that the Treasury might once again cut the tax-free dividend allowance for limited company directors, to collect an extra £1.3bn in tax receipts. 

The Chancellor has already reduced the allowance from £5,000 to £2,000, a policy which took effect this April.

Now there is concern that Philip Hammond will announce a fresh raid on the dividend tax-free allowance in this year’s Autumn Statement.

Winner of the iPhoneX Raffle - Congratulations to Maddie Blazeby from Liquid Personnel
At Umbrella.co.uk we value and appreciate every single one of our fantastic recruitment agency partners. Our recruitment agency partners and their contractors are at the heart of everything we do here at Umbrella.co.uk.
 
At Umbrella.co.uk our core focus and commitment has always been to deliver reliable value, service and compliance. However, at Umbrella.co.uk we do also like to give back and say ‘Thank You’ to our partners throughout the year. Every quarter we offer a brilliant prize which all of our recruitment partners can qualify to enter. Please keep an eye on our regular newsletters for information on our next excellent 2018 promotion. Please ensure that you are adhering to your company’s policies by taking part in our competitions. 
NEW with Umbrella and CIS Max - Save up to 38% on Cinema Tickets!

Friday Payments and discount shopping vouchers are just some of the great perks of going Max.

You can now save up to 38% on cinema tickets with our new e-vouchers. Simply login to your rewards account, place your order and you will instantly receive an email with a voucher code to exchange at the cinema.  

Simply search ‘Cinema’ to start saving on your cinema tickets!

Our Umbrella and CIS Max packages include this fantastic benefit and will save you hundreds of pounds a year shopping in-store or online. You will get over 2000 vouchers, cashback offers and insurance products from some of the biggest high street brands including supermarkets. These discounts are not available to the public, you will just need to log into your secure account to shop and save. If you are already registered simply login here.

 

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