Share this content
0
697

Shouldn't the agency take account of taxes/NI?

Client working in public sector - agency saying PSC should take account of taxes/NI

I got a call last week from a IT contractor client who has just found a contract in the public sector.  

First of all he said that the agency will deduct the taxes and NI but later told me that they will pay the full amount to his limited company and would need to take account of taxes/NI under IR35.

This doesn't seem right as the agency have the legal resposibility to take care of the taxes and NI under ITEPA 2003, Pt 2 Ch 10. ? 

 

Replies

Please login or register to join the discussion.

avatar
15th Aug 2018 18:07

(As far as I’m aware) Neither comment is correct- the public sector body should deduct the tax & NI and produce a payslip made out to ABC Ltd.

Thanks (0)
avatar
By jcace
to atleastisoundknowledgable...
15th Aug 2018 18:21

The payslip should be made out to the individual, assuming that the contract falls within IR35.

Thanks (0)
avatar
to jcace
15th Aug 2018 22:19

jcace wrote:

The payslip should be made out to the individual, assuming that the contract falls within IR35.

Happy to stand corrected

Thanks (0)
avatar
By jcace
to atleastisoundknowledgable...
15th Aug 2018 18:22

.

Thanks (0)
avatar
15th Aug 2018 18:12

Hijacking this thread a little, a NHS ltd nurse I’ve just spoke to has said his NHS nurse ltd friends are saving a ton in tax.

Presuming that the NHS is deducting tax&ni under their IR35 blanket policy, how are they saving “a ton in tax”?

My understanding is that if you’re only engaged with the NHS and being deducted tax&NI, there’s actually no point to being a ltd, there’s no taxable income to offset the expenses against.

Am I missing something ?

Thanks (0)
avatar
By Matrix
15th Aug 2018 21:19

The public sector body or agency should determine the application of the off-payroll rules. If they assess the contract as outside IR35 then payment can be made gross.

After losing a client over this very issue last week, do you think you should be advising another one?

Last week I suggested you look at the off-payroll rules to determine the responsibility of the contractor if the client does not deduct tax.

Thanks (0)
Share this content