Anyone thru Payscheme that's been investigated?

[DaveB]

but... isn't any umbrella an MSC?

(btw i am a months (not years) contractor)

No, a genuine Umbrella co. employs the contractors who work under it and they are payed as employees. i.e. PAYE + NIC.

The upside is you are guarenteed not to be investigated for PAYE / VAT / IR35, and there are no headaches involved in terms of runnning your own company.

The downside is that you take home less of your earnings both because of the PAYE and NIC payements and because the brolly takes a fee as well. You are effectivly an employee with no employee rights or benefits.

Having said all that a brolly is still a viable option for those contracting in the short term or who have money to spare in order to remove the Tax / Company management issues.

[test_guy]

Not so! The genius of some umbrella companies is that you can ask to be paid a very low salary, perhaps £20,000 and take the rest by other means (perhaps a loan) - all legal and even advertised on the home page of this website. So in fact your earnings are increased substantially as you pay less tax/NI

No, a genuine Umbrella co. employs the contractors who work under it and they are payed as employees. i.e. PAYE + NIC.

The upside is you are guarenteed not to be investigated for PAYE / VAT / IR35, and there are no headaches involved in terms of runnning your own company.

The downside is that you take home less of your earnings both because of the PAYE and NIC payements and because the brolly takes a fee as well. You are effectivly an employee with no employee rights or benefits.

Having said all that a brolly is still a viable option for those contracting in the short term or who have money to spare in order to remove the Tax / Company management issues.

[Bluebird]

Forgive me if I'm wrong but Company Loans are subject to BIK, and therefore you will have to pay NI etc when declared to HMRC.


You may get more money per month, but you will probably end up with a large tax bill at the end of each year...

[danthomas25]

Company loans?

Forgive me if I'm wrong but Company Loans are subject to BIK, and therefore you will have to pay NI etc when declared to HMRC.

Do you mean a loan from your employment company? Indeed that's the case, but what about a commercial loan where a commercial rate of interest is paid on it?

[simondolan]

Do you mean a loan from your employment company? Indeed that's the case, but what about a commercial loan where a commercial rate of interest is paid on it?

And what about when that "commercial loan" is written off? Creates the tax liability at that point.

Or do you just leave the loan running forever?

Be fun when the receivers come knocking.

[danthomas25]

And what about when that "commercial loan" is written off? Creates the tax liability at that point.

Or do you just leave the loan running forever?

Be fun when the receivers come knocking.

I'd refer you to the question I asked on another thread, i.e. "...although the [loan providing] co. could go bust in theory, Hector and a large tax bill can't happen for a guernsey-based company can it?"

Quite possible I'm missing the point, but I'm asking questions here, not posturing!

PS: the loan doesn't get written off.

[Cowboy Bob]

PS: the loan doesn't get written off.

In which case, if Payscheme ever go bust, the receivers are going to come knocking on your door since you will still owe them the money...

[ChimpMaster]

In which case, if Payscheme ever go bust, the receivers are going to come knocking on your door since you will still owe them the money...

I would imagine that the loan is paid via a trust, which I presume is not in any way responsible for the actions of the company. Hence if Payscheme or [insert any other such Co name] goes bust then the receivers can't actually retrieve money from the trust or contractors.

Just my view/guess - I won't pretend to know how these things work.

[danthomas25]

In which case, if Payscheme ever go bust, the receivers are going to come knocking on your door since you will still owe them the money...

It is a concern I suppose.
They do issue an notice of absolution with relation to the outstanding loan, but whether this is worth the paper it's printed on is a legal matter I guess. Any thoughts folks?

[Liability]

Guys

So what is the cue?

Are they legit and honourable or waste of space?

I am thinking of swtiching and P+ was one option! But reading these thread, Im VERY concerned!