Agency Only Offers PAYE - No Umbrella

[tjccjt01]

I've been out of contracting for the last eighteen months and I'm looking to go back. I've been offered a new contract, inside IR35 at a decent rate. My plan was to offset some of the tax by going through an umbrella company that offers a salary sacrifice pension option but I've been told by the agancy that they only offer PAYE through them. This is at the insistence of the client (A large US investment bank) apparently.

Has anyone else been in similar situation or is it possible that the agency is trying to pull a fast one? It sounds a bit sus to me.

[eek]

I've been out of contracting for the last eighteen months and I'm looking to go back. I've been offered a new contract, inside IR35 at a decent rate. My plan was to offset some of the tax by going through an umbrella company that offers a salary sacrifice pension option but I've been told by the agancy that they only offer PAYE through them. This is at the insistence of the client (A large US investment bank) apparently.

Has anyone else been in similar situation or is it possible that the agency is trying to pull a fast one? It sounds a bit sus to me.

Perfectly valid for an agency to refuse to allow umbrellas to be used - and given what I know about umbrella firms there are very few I would 100% trust.

However, I see nothing wrong with negotiating with the agency as to how much of their employer NI savings will they contribute into your pension fund.

[northernladuk]

I've been out of contracting for the last eighteen months and I'm looking to go back. I've been offered a new contract, inside IR35 at a decent rate. My plan was to offset some of the tax by going through an umbrella company that offers a salary sacrifice pension option but I've been told by the agancy that they only offer PAYE through them. This is at the insistence of the client (A large US investment bank) apparently.

Has anyone else been in similar situation or is it possible that the agency is trying to pull a fast one? It sounds a bit sus to me.

Not out of the realms of possibility so not suss. First time I think we've seen an agent offering PAYE only on here though so uncommon. Umbrellas just provide a service to agents so they don't have to bother with PAYE and all that marlarky. If they can do it then they don't really need the services of a brolly.

Interesting to see what their holiday pay and pension arrangements are though. Check the documentation carefully and ask them anything you aren't sure about.

[Lance]

Not out of the realms of possibility so not suss. First time I think we've seen an agent offering PAYE only on here though so uncommon. Umbrellas just provide a service to agents so they don't have to bother with PAYE and all that marlarky. If they can do it then they don't really need the services of a brolly.

Large agencies like Hays have been doing PAYE for years. So I think it's common just maybe not so for contractors who have been used to outside gigs.

[eek]

Large agencies like Hays have been doing PAYE for years. So I think it's common just maybe not so for contractors who have been used to outside gigs.

It's rare for IT contractors but that's because agencies didn't have much need or desire to run payroll. The agencies that do run payroll usually have a lot of lower paid workers which again makes us awkward exceptions - for instance wanting salary sacrifice into a pension.

[tjccjt01]

Thanks for that. Pension arrangements are a payment into Nest but not salary sacrifice. That's the bit that has me narked. Even if I get the same tax relief making a payment out of taxed income and reclaiming via my tax return I could do without the admin and the hard sums.

[eek]

Thanks for that. Pension arrangements are a payment into Nest but not salary sacrifice. That's the bit that has me narked. Even if I get the same tax relief making a payment out of taxed income and reclaiming via my tax return I could do without the admin and the hard sums.

No salary sacrifice would make the contract (no matter what the other terms were) a complete No from me.

[NowPermOutsideUK]

Can you not pay into a salary privately and then at year end self assessment recover the tax?

[northernladuk]

Can you not pay into a salary privately and then at year end self assessment recover the tax?

You mean you take gross and deal with the tax yourself later? No. The risk of you paying your tax stays with the agency I believe so they won't allow that.

[tjccjt01]

You can pay into a private pension from net income and recover the income tax paid from your self-assessment. It's not as convenient as a salary sacrifice scheme though.