We recently appeared in Business Reporter discussing how we are looking to streamline patient care, save the NHS money whilst providing fair and sustainable rates to nurses.
Have you ever been confused by the terms IR35, intermediaries, umbrellas, personal service companies? Don’t know the best way to be paid for your agency shifts? In this article we try to take out the complexity and provide useful information about getting paid for your shifts.
What is IR35?
IR35 is the common name for the IR35 legislation, or the off-payroll working rules, which were introduced by HMRC back in 2000 to tackle the problem of contractors working via their own limited company (also known as a PSC) to gain a tax advantage.
It is designed to make sure that anyone who works as an employee, but through an intermediary; such as their own Limited Company or Personal Service Company (PSC), pays broadly the same income tax (PAYE) and National Insurance (NI) as those candidates who are employed directly by an agency or a NHS Trust.
Since its introduction the IR35 rules have gradually been tightened and, to ensure greater compliance, they changed where the responsibility for applying these rules sit, from the limited company to the end hirer. This happened in 2017 for the public sector and these rules now also apply to the private sector.
Who decides if an Altrix worker falls in scope of the IR35 rules?
The decision on whether IR35 applies to the working arrangement will sit with the NHS Trust (end hirer) where the work is being conducted. It is, therefore, not up to the intermediary worker to provide evidence of whether IR35 applies, but rather it is the end hirer who is responsible for determining your IR35 status and ensuring that you are paid and taxed correctly based upon their assessment of your employment status. NHS Trusts have confirmed that all nursing roles offered through Altrix fall within IR35 legislation, therefore all income must be taxed at source.
Does IR35 apply to umbrella companies?
IR35 does not apply if you are employed by a PAYE umbrella company. However, if you are operating your Limited Company through an intermediary company then the rules do apply.
What does it mean if I want to work through my own limited company?
If you are operating your Limited Company through an intermediary company and work assignments for Altrix, the company should be withholding income tax and National Insurance (NI) from your limited company invoice. The company is responsible for paying relevant tax and NI to HMRC on your behalf.
What should I do now?
Altrix recommends you check your arrangements if you are working through your Limited Company. Remember, nursing shifts fall under the rules of the IR35 legislation which means you should be paying the same tax and NI as if you were an employee of Altrix or the NHS Trust.
What are my payment options with Altrix?
Altrix offers members the options of being employed and paid directly by Altrix or working via an Altrix approved Umbrella Company.
Being employed and paid directly by Altrix has some great advantages:
Umbrella companies are unregulated, so Altrix carries out regular checks and audits on the list of umbrella companies offered. If at any point, Altrix or HMRC identify issues with an umbrella company’s compliance to regulations they are removed from the approved list and workers are inconvenienced by having to set up alternative payment arrangements.
