Parasol Expenses situation from April?

[Money Money Money]

ultimately it matters not how you dress up what a brolly does - they will (for a small fee) take your invoice make sure you pay the correct tax and Ni on what you should and allow you to claim expenses.

generally the expenses you are allowed to claim should be the same with each company (unfortuately a very grey area right now)

so the only difference to your take home pay is actually the fee they charge (all other calculations are actual bound by law so cannot be 'fudged' unless you claim bogus expenses)

unfortunately due to legislation the brolly companies now need to ensure that they pay minimum wage (which lets face it is way below the vast majority of real contractors rates) and also holiday pay (which most contractors do not want becuase ultimately it is just coming out of the invoice value)

but to satisfy HMRC hoops have to be jumped through which causes confusion and concern amongst all contractors cos they do not understand how the brolly gets to their invoice net pay from the invoice value and the first reaction is to phone the brolly and complain they are being ripped off.

the vast majority of the large umbrellas will not rip you off and will be above board (there is a big enough market for them to make money legitimately so there is no point in trying to rip a couple of contractors of for a few hundred quid)

so as I allways say if you are new to contracting use brolly for first 12 - 18 months then look at ltd if you are serious about it.

Sounds pretty spot on to me mate!

But its the level of service that makes the difference! Think that's why so many people ask for recommendations, but on a site like this there are always going to be negative comments, positive Comments, Bulls*it comments from competitors and ex-employees.

Not really worth taking the pimps recommendations either, because we all know why they refer.

Best taking friend recommendations I suppose!

[tim123]

but sick pay can be SSP which will be claimed back by the employer from the government (same applies to SMP and SPP)

Only by small companies. My Ltd is small enough to claim back SSP, a brolly running 1000 individuals' PAYE cannot claim it back as they are too big.

[Xtrain]

ultimately it matters not how you dress up what a brolly does - they will (for a small fee) take your invoice make sure you pay the correct tax and Ni on what you should and allow you to claim expenses.

generally the expenses you are allowed to claim should be the same with each company (unfortuately a very grey area right now)

so the only difference to your take home pay is actually the fee they charge (all other calculations are actual bound by law so cannot be 'fudged' unless you claim bogus expenses)

unfortunately due to legislation the brolly companies now need to ensure that they pay minimum wage (which lets face it is way below the vast majority of real contractors rates) and also holiday pay (which most contractors do not want becuase ultimately it is just coming out of the invoice value)

but to satisfy HMRC hoops have to be jumped through which causes confusion and concern amongst all contractors cos they do not understand how the brolly gets to their invoice net pay from the invoice value and the first reaction is to phone the brolly and complain they are being ripped off.

the vast majority of the large umbrellas will not rip you off and will be above board (there is a big enough market for them to make money legitimately so there is no point in trying to rip a couple of contractors of for a few hundred quid)

so as I allways say if you are new to contracting use brolly for first 12 - 18 months then look at ltd if you are serious about it.

As a contractor you seem to know helluva lot about how brollies are run. Which one do you work for?

Anyway to my mind I can't quite understand still why anyone would contemplate a brolly of whatever kind against a single ltd company. With a brolly you are now going to be an employee paying full tax / ni with little or no expenses and the added bonus of having your funds deducted further to pay for your own SSP and holidays!!

With a single ltd you run the show, can claim expenses and have no need to make any deductions.

It really is a complete no brainer. End of.

[Bluebird]

As a contractor you seem to know helluva lot about how brollies are run. Which one do you work for?

Anyway to my mind I can't quite understand still why anyone would contemplate a brolly of whatever kind against a single ltd company. With a brolly you are now going to be an employee paying full tax / ni with little or no expenses and the added bonus of having your funds deducted further to pay for your own SSP and holidays!!

With a single ltd you run the show, can claim expenses and have no need to make any deductions.

It really is a complete no brainer. End of.

Well not everybody is OUTSIDE of IR35 - if you are inside it makes sense to use a brolly.

[PAG]

so as I allways say if you are new to contracting use brolly for first 12 - 18 months then look at ltd if you are serious about it.

I agree with your idea, however I think 12 - 18 months is a long time. 3 - 6 months is more than enough to realise if you are serious or not.

Also you miss the point that if you are with brolly then you can not claim expenses such as part elec, broadband, etc bills. These are NOT bogus expenses specially if you are either working from home or using part of your home to run the ltd.

[Bluebird]

correct, there are still *some* advantages of going Ltd even if you are INSIDE Ir35, however the amount of gain compared to overheads is probably not worth it.

[mictech]

How many time do we have to say this. The money you save on your home to work travel alone (that you will not get with the brolie) will pay any overheads these brollies claim. Look at there weekly charges and you will see where the cost really lie.

[Bluebird]

How many time do we have to say this. The money you save on your home to work travel alone (that you will not get with the brolie) will pay any overheads these brollies claim. Look at there weekly charges and you will see where the cost really lie.

Some brollies are saying you can get this.

They're stance is that an employees "normal place of work" is the brolly office, not the client site - which would make sense as they are an employee of the brolly.

[Xtrain]

Some brollies are saying you can get this.

They're stance is that an employees "normal place of work" is the brolly office, not the client site - which would make sense as they are an employee of the brolly.

I think we have already established that what it says in your contract and where you actually work are 2 different things. Don't believe the IR will be fooled by this.

Brolly fees are now equal or more than running a limited, you get 5% relief with a ltd, you can claim travel to work expenses with a limited, no SSP and holiday deductions with a limited, you can join the flat rate VAT scheme with a limited and if you are outside of IR35 you can pay divvies.

...and if you still think there is not much difference between your net take home from a brolly and a limited then you are just the type of "contractor" the brollies are aiming for!

[jh0711]

but you are missing the one single point that not everyone is motivated by money or the fact they feel like a big man when they tell people they are a director of a company.

if the return you get from a brolly is enough for you to live on then there is no motivation to set up a ltd co and mess around in that manner.

the vast majroity of the workforce are permanent - there salaries are lower than yours etc - if the only single motivating factor was money then the workforce would collapse - permies get job secrurity - which for a lot of people is much more important than an extra couple of quid in their pay check

it is pretty simple, any managment course will tell you that people have different motivators and it is not just money - those of you who bang on about the high returns from a Ltd Co are possible missing the point of why some people choose contracting as their way of life

it is maybe about variety and challenge and having change in your life meeting different people and taking on different roles for a lot of people it is not about chasing every last dime.

brollies fill a hole in the market for people who want to contract but really have no interst in the whole ltd co malarky - also if any of you have used many agencies for different contracts and gone PAYE with them you will know what a pain in the @ss it is to keep having to get your P45 from one agency, pass it to another and then wait 6-8 weeks for your tax records to catch up - with a brolly your tax records stay in the same place so you can go from gig to gig with no worries about emergency tax etc etc etc and that in itself is worth something....