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Thanks - yep, this all makes sense and thinking about it I did see something about only FCSA accredited umbrellas so that will narrow down my search.
I'm such an unprofitable sole trader (I've spent more on equipment than my house is worth) I'm just not used to seeing chunks of tax like that.
CYOA-
I'm such an unprofitable sole trader
So I'm not the only one 🙂
Can somebody explain in terms a simpleton can understand how your client hasn't got their IR35 policy arse-backwards? I thought the whole point was to stop sole traders from interposing an incorporated entity between themselves and their customers (and taking profits as dividends and capital gains rather than salary)
As leshaches said, outsourced umbrella described above paying minimum wage plus a separate "commission" looks like exactly the structuring of payments IR35 was supposed to stamp out.
If you're a sole trader, there's no opportunity to structure payments as anything but taxable profits.
gbj_tester
I don't know the answer, but at the very least your father in law would need to provide insurance for the work you carry out and pay you via proper payroll.
My end clients only allowed certain approved umbrellas, probably to avoid being accused of knowingly setting up tax-avoiding quasi-employment schemes.
Of course - it's PAYE income tax / NI, plus a (usually fixed) fee per week for the umbrella (which also pays for stuff like insurance.
You can also claim some expenses through the umbrella. Not a lot.