Off Topic Any Contractors on here? (Umbrella question)

I'm currently self employed through my Ltd Company but a contract has come up that is inside ir35 and am required to use an umbrella

What I'd be interested to know is:

1. Can I keep my Ltd Co operating whilst using umbrella?
2. Can I still put expenses (hotels/travel) through Ltd company even though payment/invoicing is going through the UC
3. Is there any benefit to closing ltd co? Heard somewhere that you can extract remaining dividends at 10% tax.

Ideally I want to keep my ltd company active as this may be a short term (6-12 months) contract, especially if I can still expense

Any advice/experience gratefully received

 

I closed my company, as I'm in a long term contract that's been deemed by the company "inside IR35", although I'd argue it isn't, but they're risk averse. However, there's no reason you can't keep the company running alongside.

Putting expenses that aren't associated with the business is always going to be dodgy. If you get any sort of review, they may pick it up, or they may not, but if they do then it's a reason they may look closer at previous contracts, and IR35 is like a sword hanging above our heads for many years backward, so it's not something I'd encourage them to do.

As for closing the company and getting the money out, you'd have to ask an accountant. It's going to depend on how much is in it. If it's a lot, then you may be better of bunging it into a pension, but there's a limit of I think £40K per year that you can pay out at full tax relief, so you may have to keep the company going for a few years to syphon out the cash. Keeping the company running is obviously just an extra expense.

 

Thanks

 

If you can avoid umbrella, avoid it, would be my take.

Im no longer any of them, but have done them all in the past. 714, SC60, CIS , Ltd. But not umbrellas. My accountant advised against it, and even said she wouldn't want to do my books if I went down that route.

CIS is still possible in many areas. Much better than umbrella.

 

I worked at an umbrella factory once.
When they were short of workers
It was easy to get cover for rainy days .

 

Tit.

 

I worked in IT when IR35 was around but not enforced, it was always to be avoided. Now IT govt contracts are (all?) IR35 and I was tempted back to work just before covid. The umbrella restriction made it not worthwhile for me as I couldn't pay my wife a wage and couldn't operate my own pension scheme as I wanted to. Would've been 40% tax which I have previously avoided/claimed back. Needless to say I stayed retired.

 

1. - yes
2. - no
3. - no there is plenty outside IR35 around

 

Wánk