New to (UK) contracting. Most tax efficient solution?

[mattnovak]

Hi all.

Been meeting with a few recruiters lately, after the start up I worked for went into administration in December.

There’s a few options on the table, and my day rate commands about £500-£600 in the current climate.

Assuming I go down the interim route (which in itself is not set in stone, there’s a few permanent options I am in the frame for), what’s the best legal way to retain as much of my hard earned cash as possible?

Thanks in advance for any advice.

[UpTheIron]

Highest Retention: Ltd Company.
Least Hassle: PAYE Umbrella

Anything else: Dodgy.

What's the IR35 position with the stuff you are looking at?

[mattnovak]

Thanks - am deemed outside IR35 for the positions I have been discussing.

Have worked under an umbrella co before - in Prague, many moons ago. It was the path of least resistance and heartily recommended by HR - I suspect a brown envelope may have been involved. Ended up paying Swiss tax and NI, and there’s a Swiss pension with my name on it somewhere! Not an experience I would relish repeating, but I appreciate I’m comparing former Soviet apples with Capitalist Oranges.

I can just buy a ltd co off the shelf, right?

[UpTheIron]

You can just form one yourself online, no need to buy am existing one.

You are going to need a contractor friendly accountant though... many will set up a Ltd for you, assist with bank account opening, required insurances and so on.

I'd suggest reading all the first timer guides on ContractorUK.

[mattnovak]

Many thanks, uptheiron, for your advice. Shall look into it.