Newbie: PayStream the options

**pmeswani** · 18 October 2008, 08:14

Originally posted by biz View Post

Hi,

New to all this and wanted to ask some advice on paystream.

There seems to be 3 options,

Umbrella = My Umbrella Company
My PAYEsafe Company
or limited.

Just wondered if any one had any experience of either, how quick are they all to set up. My 1st contract is 6 months?

All a bit daunting and have read so many books with different agencies / accountants all saying different things. My head is spinning, and wanted to get some advice from anyone who has acutally used them?

Thanks so much.

It really depends on a number of things.

1. How much you are getting on a hourly / daily / weekly / monthly basis.

2. Is the contract IR35 caught or not? Either way, going Ltd may be benificial.

3. Is there a chance of getting an extension to the contract?

4. Are you going to stay in contracting after the 6 months?

There are few other things you will need to consider, but these are a starter for 4.

I decided to go limited with my first 6 month contract, but there again, I was getting £35 p/h and wanted to stay in Contracting for the long term and it made financial sense. Ironically, I got a 3 month extension, which surprised me as I didn't expect it.

I should have gone Ltd on my first contract, but didn't know what was going to happen at that time nor did I know if I was going to stay in Contracting. The rate on my first contract was not that great.

We cannot make the decision for you, and you will need to do your own research before committing.

**tim123** · 18 October 2008, 08:49

Originally posted by biz View Post

Hi,

New to all this and wanted to ask some advice on paystream.

There seems to be 3 options,

Umbrella = My Umbrella Company
My PAYEsafe Company
or limited.

I don't know where this third option has come from.

You only have two options as a contractor:

Own Limited or PAYE Umbrella, everything else is outlawed by legislation.

Any third option that you find is either illegal or fits into one of the other two boxes.

Are you sure that you're not just here to advertise your new unbrella service by pretending that it is something else (the post count of 1 is a real give-away).

HTH

tim

**biz** · 18 October 2008, 15:56

Hey sorry for confusion, not advertising my own company.

I am looking at paystream, and they seem to offer a number of options.

I assume i have understood this properly,

Go through their paye umbrella company.

Set up my own company (seems to suggest i am setting up my own umbrella company, which they do on my behalf ). Basically i am within IR35 and therefore this way i receive my pay with PAYE and NICs deducted on all my earnings. Its called PAYEsafe on the paystream website, just wondered if anyone had used this option before?

Hopefully going to a 6month contract on £350 a day. This is my first contract, hence my newbie status and wanted to get opinions on the paystream company before going ahead.

Any suggestions helpful.

**Beefy198** · 19 October 2008, 12:41

The second one just sounds like an umbrella company to me

**Beefy198** · 19 October 2008, 12:50

OK, I just read up on that service and to me it's pointless. You are PAYE and the only way that you'll be better off under this option from any permie is by claiming expenses.

The "My PAYEsafe" service is 'free', but only when claiming under £20 of expenses. So start claiming these and the cost starts racking up. Now, £20 is just 50 miles of driving per week, and if you truly are "moving from contract to contract on a fairly regular basis" I'm sure you'll probably be fairly mobile and racking up more than this. And even if you use public transport you won't find £20 taking you far!

Furthermore, you need to buy professional indemnity insurance separately, which most brollies throw in in their service charge. It says they can offer it for a 'contribution' of £150 per annum. I'm guessing by the wording that this charge isn't broken down across the year, so if you don't work for a while or go back to permanent employment I guess that's a cost you're lumbered with?

There, one free consultation out of the way.

**TykeMerc** · 19 October 2008, 12:57

I'm a bit confused by the options you've mentioned.

1. Sounds like a traditional umbrella

2. Sounds like Paystream are offering a Ltd company formation service with an accountancy service bolted on which isn't that unusual either, many accountants firms offer this

Beyond these options if you're determined to go with Paystream then chose the option you prefer, since your contract is IR35 caught there's not a huge amount of difference.

**tim123** · 19 October 2008, 20:12

Their charging basis for expenses makes no sense.

How can the amount you claim make any difference to their workload, surely it's number of items that's important.

Using their scheme someone claiming 40 * 50p bus tickets per week will see a smaller charge than someone claiming one 21.00 season ticket per week. This doesn't seem reasonable.

And, as per comments that I have made elsewhere, I'm sure that the average contractor can survive on monthly expense payments.

tim

**NotAllThere** · 19 October 2008, 20:49

Unless you're planning to go back to permie after this contract, go ltd. No brainer.

**PhilAtBFCA** · 20 October 2008, 08:33

Newbie Options

Biz,

Maybe the question you should be asking yourself is do you want to run your own business or not ?
If you dont , stick to an Umbrella or go PAYE.
If you are interested in running your own business, whether inside IR35 or not, then a Ltd Co if you are contracting through a Staffing Company is the right option.
If you run your own business it comes with responsibilities and some administration work, it takes effort to get the best out of your business, and I think you need to be very aware of that before you start. I dont you can just expect an accountant or other service provider to do it all for you and you have all the benefits. Under the current legislative environment its not realistic.

I hope that helps you decide.

Phil

Newbie: PayStream the options