Contractors

Employment rights, including all statutory rights and benefits such as holiday pay, maternity, paternity, sick leave, pension etc.

Employment history whilst working on a contingent, multi-location basis (notably to support access to finance, housing/mortgages, etc).

Joined up pay from fragmented working:

–          Many workers will perform multiple assignments during a week or a month.

–          Umbrellas consolidate their workers earnings and ensure appropriate taxes are paid.

Peace of mind that tax is paid appropriately, with no need to submit an annual self-assessment return to HMRC (unless you have another reason why a self-assessment is required by HMRC).

Employee/HR support, in the unlikely event that an individual needs HR advice, such as a grievance case, as their employer the umbrella firm will have processes to support them.

As per our payslips, the ‘Assignment rate’ section will show the number of hours/days worked and the Umbrella rate multiplied to get the total amount of money received from the agency (also known as ‘Company income received’).

The Umbrella Rate is the total sum received by iConsult in respect of an assignment. It includes your standard rate, any bonus, the Company’s margin as well as a payment on account of the employment costs (including Employer’s National Insurance Contributions) which the Company must pay. For the avoidance of any doubt, the Umbrella Rate is not the rate at which you are entitled to be paid as it includes the other sums referred to above which will be retained by the Company before we pay your standard rate.

For this reason, the Umbrella rate will be slightly higher than if it had been a normal PAYE rate, and this is in order to include the employers NI, which would normally be paid straight to HMRC from the employer, without the employee ever knowing about it. However, with an umbrella company or ltd company it is included in the rate instead.

From the total amount of money that we receive from the agency, we deduct our iConsult margin, employers NI and any allowable tax reducing expenses. This leaves us with the total pay amount (gross taxable pay) which is run through our payroll software and PAYE and employee NI deductions are calculated.  We then add back on the allowable tax reducing expenses which haven’t been taxed, leaving the total amount payable to the employee (net pay).

This is not a problem; we can work with almost every agency and client. Just tell the new agency that you are with iconsultumbrella.co.uk and pass them our contact details. Your Account manager can liaise with the agency over the contract details.

You can simply continue with our service.  If you have previously requested a P45, or not been paid for more than 2 calendar months we may have to restart your employment with us but this is not a problem.  We can liaise with your agency over the new contract details.

We will ask you your employment circumstances over the phone to ensure we place you on the correct tax code.  You can also complete a P46 form if you wish.  If there are any issues with your tax, you will need to arrange with HMRC for them to instruct us of your correct tax code

If you have a P45 from your previous employer, please send the originals of parts 2 and 3 to us by e-mail or post.

The simplest way is to give us a call on 0117 374 1114. Our team of experts will discuss the options available to you and give you an illustration of your take home pay.

You will then be sent an electronic registration form which can be completed online in less than 10-15 minutes and a request for Right to Work in the UK documents.

Once we have received this, you will be provided with your dedicated point of contact throughout your employment with us and said person can liaise with your recruitment agency or end client to take care of any administration required.

You’ll need to accept our contract of employment (again sent electronically for ease) to complete the registration process.

IR35 was introduced as new legislation as part of the finance act 1999, as a way of plugging the £400m loophole in the tax law of the time.

Up until this legislation, contractors operated through either an Umbrella or Limited company. In doing so they were able to freely manage their income themselves, normally with the assistance of an accountant.

IR35 is an HMRC tax law designed to increase government tax revenues. It prevents contractors avoiding tax. Contractors could benefit financially if their contract was outside of the IR35 laws.

This is because they could have taken a proportion of their income as a dividend and so avoid an element of tax. The IR35 tax law, which has been around for nearly 20 years, covers most contractors in the UK. This means that a contractor gets less tax breaks than they used to get before IR35 came into effect.

Supervision, Direction or Control (SDC) plays a large part in CIS. Anyone found to be working under the right of SDC is unable to proceed with the CIS arrangement and would instead be offered the Umbrella model. 

A genuine, self-employed worker is not seen to be subject to (or to the right of) SDC, due to being fully qualified and competent to complete their duties without the need of any supervision, direction or control.

Workers paid less than £12 per hour may not be considered suitable for the CIS arrangement and are assumed to be “high risk”.  They will therefore be subject to additional checks to verify their self-employed status.  This is due to the fact that any worker on this amount of pay is likely to be subject to (or to the right of) supervision, direction and control (SDC) in how they undertake their duties. 

The following fall into the third-party category:

1. The director, or other office holder or associate of the MSC.
2. The MSC provider, or the director, or holder of the associate MSC provider
3. Any other person who directly or indirectly has encouraged or been actively involved in the provision by the MSC of the services of the individual, or a director, or other office holder or associate of such person.

• Recruitment companies fall into the third category and if you have directly advised contractors to use an MSC provider or influenced their decision then HMRC can issue a transfer notice for recoverable funds.
• iConsult can reassure agencies and contractors alike that we offer purely a PAYE Umbrella Solution which treats all income as employment income and therefore do not fall within the definition of a Managed Service Company, therefore iConsult will not owe any liabilities to HMRC and therefore there will be no debt to be transferred.
• iConsult as a PAYE Umbrella Company does not meet the 3^rd condition quoted in HMRC guidance:
• ‘In umbrella companies, workers are treated as employees of the umbrella company and all payments to workers treated as employment income which is paid in the form of salary and allowable expenses. It follows therefore, what the worker has received from the umbrella company is the same as they would have received from any other company through which the worker operated, and which treated all payments as employment income. Consequently, the third condition is not met, and the umbrella company does not meet the definition of a Managed Service Company.’