Maternity pay for offshore umbrella??

[Meady]

Thanks for your comments. I think this confirms my belief that I'm not entitled to anything. Dont want to dig too deep with the DHSS for fear of too many questions!!

Thanks

[Mordac]

Can anyone tell me if I am entitled to maternity pay from the government if I'm registered with an umbrella company in Guernsey (working in the UK)? The umbrealla company has said they cant help me with it.

If you've signed up with a Guernsey company to minimize tax (or avoid it altogether?) then you've got a bit of a cheek wailing about maternity pay. My guess is you're entitled to SMP in the UK (assuming you are normally a UK taxpayer) but if the DHSS (or whoever) think you're on a dodge and tell you to get stuffed, you won't find much sympathy round here.

Edit - I've just realised you weren't wailing at all, so acknowledged.

[oraclesmith]

I would agree with you if the employee had been subcontracted to the host country from another country.

But this isn't the case.

The employee lives in the UK, has always lived in the UK, is currently working at a location in the UK and has no links of any kind with the employer's home country.

I can't see that moving the holder of the employment contract to another county allows the employer to ignore UK employment rules for staff permanently based in the UK . Anybody could set up a 'lets get around employment rules' scam company like this, if it worked.

tim

Well of course it does. For a start, the employee/contractor in question is not paying UK national insurance or UK income tax. The contract itself will be governed solely by Guernsey law - which is how the umbrella can get away with offering low tax employment. The same notion which allows the company and the employee to avoid UK tax also allows the company and employee to avoid UK employment law and government benefits. As I said, there appears to be qualifying periods and other conditions for claiming under the reciprocal agreements, so this needs looking into.

The link with the employers country is that are an employee of that company and that company is solely governed by Guernsey law.

Meady - don't give up just yet. It's worth googling on maternity, Guernsey etc in order to get some solid info on this. You may well be able to claim SMP under the reciprocal agreements, but this is way below the normal maternity pay you'd get from a decent UK firm.

[tim123]

Well of course it does. For a start, the employee/contractor in question is not paying UK national insurance or UK income tax.

And Where did the OP say that?

I once worked through a CI brolly. The only reason that they were in CI was because that is where their staff were. But I was payrolled locally, had a local accountant, paying my taxes and NI locally. Had I been long term sick I would (I hope) have qualified for the local scheme.

You are making an assumption that the guy is working through a CI brolly in order to gain a tax advantage. He has not said this (and I have assumed that this isn't the reason)

tim

[oraclesmith]

Ok, I made a bit of an assumption based on "'With regard to your email, unfortunately we, being a Guernsey
registered company, are unable to assist you with maternity pay.'"

However, I bet you a fake fiver they aren't paying UK taxes. Shall we ask Meady ?

PS. I also made the assumption that the guy is a woman, but I see you didn't !

[ASB]

Thanks for your comments. I think this confirms my belief that I'm not entitled to anything. Dont want to dig too deep with the DHSS for fear of too many questions!!

Thanks

I think you need to ask yourself 2 questions.

1) Am I UK resident for tax purposes. If so then the location of your employer makes little difference to you entitlements to SMP. [Unless the foreign body has immunity - basically it's a consulate].

http://www.dwp.gov.uk/advisers/ni17a/smp/smp_5.asp

2) Should I be UK resident for tax purposes? i.e. you should be treated as resident but you do not know it. If you are physically working in the UK for any length of time then the answer to this question is probably (but not necessarily) yes.

[Meady]

My salary income is taxed through a UK payroll and is operated under normal UK rules with PAYE NI employees and emplyers contributions being deducted. The dividend income is declared on my UK tax return as foreign dividend and I pay tax on this.

In 6 years of contracting I have been within the IR35 rules and paid in salary only. The last 6 months have been through the CI company so yes, I am paying less tax but I've never been paid through dividends before so I'm not sure if I'm paying less tax than I would have done in the UK. Does this make me a hard nosed tax dodger??

And the last time I looked I was a woman - if not, maternity pay is the least of my worries!!

Thanks

[oraclesmith]

It looks as though you could get SMP because they pay class 1 NI for you. At least you're not ineligible because of this, according to the link ASB published. The problem may be getting them to acknowledge that they should do this.

It doesn't sound like you gain much from going with a CI umbrella though, as against an UK umbrella. Probably more profitable for them though.

[tim123]

PS. I also made the assumption that the guy is a woman, but I see you didn't !

Oops.

Sorry

tim