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Contracting Models Info for UK Contractors

With Covid having led some people to work as contractors for the first time and with the IR35 changes in April 2021, Volt has produced this overview of the contracting models that we use and how they might work for you.

Please be aware that some of our clients mandate the contracting model that you can use.  If this is the case for the client you are working for or are hoping to work for, your recruitment consultant will let you know.

PAYE

  • You will have a contract for services with Volt
  • You will be paid net of PAYE and NIC (Volt pays these on to HMRC on your behalf)
  • You will be a worker, not an employee
  • You will be entitled to holiday, statutory sick pay and a NEST pension
  • You will be an agency worker

Umbrella

  • You will have a contract with the umbrella company and the umbrella company will have a contract with Volt.
  • Your umbrella company will pay you net of PAYE and NIC
  • You will be employed by your umbrella company
  • You will be entitled to holiday pay, statutory sick pay and a pension.  Other benefits will vary by umbrella.
  • You will be an agency worker.
  • If you have never used an umbrella before, we have worked for many years with JSA  (https://jsagroup.co.uk/) and recommend their services, but you are welcome to use any umbrella which is FCSA registered (https://www.fcsa.org.uk/members/)

Ltd company (Inside IR35)

  • Your limited company will hold a contract with Giant, Volt’s chosen accounting provider for inside IR35 assignments, and Giant will hold a contract with Volt
  • Giant will pay your limited company net of PAYE and NICs
  • Your limited company will continue to determine whether you are a worker or an employee, but you will be treated as an employee for tax purposes.
  • Your limited company remains responsible for holiday pay, statutory sick pay, pensions and any other benefits.
  • You will be an agency worker.

Ltd company (outside of IR35)

  • Your  limited company will hold a contract with Volt.
  • Volt will pay your limited company gross and you will be responsible for all PAYE and NICS calculations and payments.
  • Your limited company will determine if you are a worker or an employee of the company.
  • Your limited company remains responsible for holiday pay, statutory sick pay, pensions and other benefits.
  • You will not be an agency worker.