No. If you are captured by IR35 there are number of options available to you, including working through your company or going on the payroll of the agency or the end hirer. You need to consider which of the options available best suits your circumstances.
While there is no obligation to use an Umbrella company if you are permanently IR35 captured, it is often the best solution.
If you continue to operate through your limited company, the agency or end hirer (whichever is closest to you in the chain), will deduct income tax and National Insurance from your net invoice value and provide you with a payslip.
While you can then withdraw the stated amount without worrying about any further tax implications, you would still need to retain money in the limited company to pay company running costs such as accountancy fees and insurance. This means that a limited company is a lot more cost effective if you work on a combination of captured and non-captured assignments. Even if your income is wholly derived from IR35 captured sources, streamlining accumulated funds in the company can also have its benefits, allowing you to tax plan around income extraction.
If you wish you can switch between using your company (when not captured) and moving over to an umbrella solution when you are. Our Flex service offers a cost-effective way to do this. But if your agency or end hirer (whoever is closest to you in the chain) can’t put you on the payroll, and you are entirely captured by IR35, an umbrella solution is probably the best solution.