Agencies and End-Users are now assessing contractors contracts and roles and deciding on whether the role is to be inside IR35, outside IR35 or PAYE. It’s confusing but hopefully we can help clarify it a bit.
- Some roles, such as ones recently seen in RBS, have changed to direct employment with RBS through normal PAYE – this type of change is neither inside nor outside, it is simply a move to straightforward employment.
- If you are outside IR35 – nothing changes – happy days!
- If you are inside IR35 and not directly employed you will likely be asked to join an Umbrella Company and be paid through them.
Umbrella Companies – what does this mean?
You will be given a contract of employment, be entitled to holiday pay, sick pay and other employment benefits. The Umbrella Company will receive your day rate, deduct employment costs and pay your net salary. As all Umbrella Companies are the same, except from their fees, your take home should be the same whatever you chose. If it’s not, it’s likely to be too good to be true and you should seek further advice.
What will I take home?
If you would like a comparison of how your current day rate would look like each month compared to your current PSC, then get in touch and we can provide an illustration.