Quick question - NI Calcs

**TykeMerc** · 20 April 2009, 14:32

Pretty much, fairly sure you need to add in personal allowance to the deductions column too although one of the accountants or Umbrella posters can confirm.

**Sausage Surprise** · 20 April 2009, 14:42

Originally posted by TykeMerc View Post

Pretty much, fairly sure you need to add in personal allowance to the deductions column too although one of the accountants or Umbrella posters can confirm.

That would be for PAYE though?

What I need to know is if I'm reading from the monthly HMRC Tables (J) would I use £2000 or £3000 figure?

**Archangel** · 21 April 2009, 08:35

I would think the 2000 would INCLUDE employers NI (but exclude Employees NI)

So the figure would be less than 2000

**BlightyBoy** · 21 April 2009, 10:20

Originally posted by Sausage Surprise View Post

Working under an Umbrella -

Monthly Earnings = 3000
Expenses + Fees = 1000

The PAYE calc is based on a figure of £2000...correct?

Is the NI (E/R + E/E) figure from the monthly HMRC tables based on £3000 or £2000?

Please confirm that I am not going mad....

Thinking back to when I used to do my own payroll... the NI calculations should be on the £3000, not the £2000, and then both employers (uncapped) and employees (capped) contributions.

HTH

**TykeMerc** · 21 April 2009, 10:43

Originally posted by Sausage Surprise View Post

That would be for PAYE though?

What I need to know is if I'm reading from the monthly HMRC Tables (J) would I use £2000 or £3000 figure?

You started your post with "Working under an Umbrella", that's PAYE by default unless it's some tax avoidance scheme.

**PayMatters** · 21 April 2009, 13:42

No it's wrong!

From the 2k you have to deduct employers National Insurance to get the gross pay per your payslip.

This is quite tricky as it's based on your final gross pay and not the 2k! (i.e. 12.8/112.8 but also you need to take into account £476 exempt limit)

Therefore employers NIC will be approx = (12.8/112.8*(2000-476))=173

Therefore Gross Pay will be 2000-173.

Taxable Pay will be after deducting your personal allowance entitlement.

**Sausage Surprise** · 21 April 2009, 14:50

Originally posted by PayMatters View Post

No it's wrong!

From the 2k you have to deduct employers National Insurance to get the gross pay per your payslip.

This is quite tricky as it's based on your final gross pay and not the 2k! (i.e. 12.8/112.8 but also you need to take into account £476 exempt limit)

Therefore employers NIC will be approx = (12.8/112.8*(2000-476))=173

Therefore Gross Pay will be 2000-173.

Taxable Pay will be after deducting your personal allowance entitlement.

Should this be 3000?

Found a site here that would use the 2000 figure - does it look right?

<removed>

**PayMatters** · 21 April 2009, 16:19

The expenses are reimbursed as a repayment of expenses you have incurred and not as .salary

**LA1** · 21 April 2009, 16:26

Paymatters is correct - The expenses and employers NI are not part of your taxable income. In the same way that the employers NI is not part of the salary of a perm employee.

If the website quoted implies that the gross payment should be used, it's wrong. This would be like paying tax/NI on the VAT.

Its simply not part of your salary. Ask any accountant or Umbrella company

Quick question - NI Calcs