Registering with an umbrella company from Australia

[Mal P]

Hi folks,

I'm coming over from Australia for a working holiday in London (silly I know with the economy and all but I have a job to come to back in Aus if it all goes wrong).

Quick question - I'm told that if I register with an umbrella company before I leave, that I can claim flights, living expenses etc. How comprehensive is this i.e. can I claim back rent etc? Since I am most definately a temporary worker in London, and my home is Australia.

If so, which umbrella company would you recommend, that will claim the full amount of expenses as permitted by law? I heard Danbro is alright, but that so is 1st Contact who handle foreign workers a bit more. Would definately like an all inclusive service including preparing my tax returns in the UK.

Are employers/recruiters restrictive with the choice of umbrella company or will they be happy to deal with anyone reputable?

Thank you,
Mal

[Paddy]

Hi folks,

I'm coming over from Australia for a working holiday in London (silly I know with the economy and all but I have a job to come to back in Aus if it all goes wrong).

Quick question - I'm told that if I register with an umbrella company before I leave, that I can claim flights, living expenses etc. How comprehensive is this i.e. can I claim back rent etc? Since I am most definately a temporary worker in London, and my home is Australia.

If so, which umbrella company would you recommend, that will claim the full amount of expenses as permitted by law? I heard Danbro is alright, but that so is 1st Contact who handle foreign workers a bit more. Would definately like an all inclusive service including preparing my tax returns in the UK.

Are employers/recruiters restrictive with the choice of umbrella company or will they be happy to deal with anyone reputable?

Thank you,
Mal

A working holiday visa is for employment undertaken incidental to the holiday of which it formed a part, and not the key reason behind the type of UK visa application.

By trying to claim for costs of you travel expenses to and from the UK you are admitting that employment is your prime objective and thus breaching the visa conditions.

[facboy]

good point! dunno if you have other mates who have done the like, but certainly in the last couple of years the home office have really been cracking down on that kind of stuff.

i had a mate who was here on a working holiday for 12 months, went back and tried to get a tier 1 and got rejected for breaching visa conditions, which means she can't even come back for a holiday on a tourist visa now - not sure how long she's banned for, year or 2 maybe.

[Mal P]

Hi guys,

The new "Youth Mobility Scheme" tier 5 visa (which I have been granted) is actually quite different from the old working holiday visa, as it allows you to work for two years restriction free in any profession.

http://www.ukba.homeoffice.gov.uk/wo...andconditions/

Thanks

[Wanderer]

Gidday mate and welcome!

Quick question - I'm told that if I register with an umbrella company before I leave, that I can claim flights, living expenses etc. How comprehensive is this i.e. can I claim back rent etc? Since I am most definately a temporary worker in London, and my home is Australia.

To be honest, this sounds pretty dodgy. Maybe an accountant on here can comment on that one. An accountant told me something that I will always remember:

"You can claim anything you like as expenses for your Limited Company but if the Inland Revenue investigate you and they disallow your claims then you will have to pay it back, plus interest and penalties"

Wether you will be in the UK for long enough for the tax man to come after you is another question.

The difficult part is probably going to be getting setup with an umbrella before you are actually in the UK. You need a "National Insurance" number before you can work and I don't think you can apply for that from Oz. Ask some of the umbrellas, they may be able to help you out.

You are right to say that you want someone to do everything for you, and for someone just arriving a brolly company is probably a good choice. It's really easy to setup a limited company but there is a lot of messing about with taxes and forms and stuff that you probably don't want to deal with. You will pay a lot more tax though.

You will also be shocked at how antiquated the banking system is in this country. If you can get a UK bank account set up before you come here then do it.

If so, which umbrella company would you recommend, that will claim the full amount of expenses as permitted by law?

The guideline is that you can claim any expense "wholly and exclusively incurred in the course of your business". If there is some duality of purpose (ie, you take a flight to Paris, work one day and then have 3 days off to go sightseeing) then it's not allowable.

Umbrellas talk about their dispensations and stuff but really, you can only claim expenses you actually incur and you need to keep receipts.

Are employers/recruiters restrictive with the choice of umbrella company or will they be happy to deal with anyone reputable?

Hard to say really. There is no reason why they wouldn't deal with your umbrella or LTD company. Some agencies have "perferred suppliers" they try and steer you towards. The exception to this is if you use a company that is not registered in England and Wales. That's a no-no, especially if it's a tax haven like the Isle of Man or Jersey.

Good luck and enjoy your OE!

[phillrow]

I have used CXC in both Aust and the UK (www.cxcglobal.com). Talk to them about it. I did basically what you did with flights etc. Another multinational umbrella to look at it ITG/myOE (myoe.com) which a friend of mine has used in both Oz and the UK.

As a foreign non-resident contractor you can claim direct flights to/from your home country (so no 3 day stop over in Thailand on the way if you want to claim the flight), rent, a food allowance etc. Now before the British locals pipe up about how this advantages foreigners they can come to Oz and do the exact same thing! I have a pom college here in Oz who does exactly that and doesn't really want to go perm due to the tax advantages of him being a foreign citizen contractor.

Hell you can actually do something along those lines just by contracting interstate in Oz.

[phillrow]

Oh and I also had no issues with agents and choice of Umbrella. I don't think that they really care as long as they are being invoiced and then making payments to a legitimately setup business with the relevant paper work and VAT or whatever number it is that you need in the UK that is roughly equivalent to the Oz ABN.

[Mal P]

Cheers very much for the replies! I'm using one of those starter companies who are arranging a UK bank account and the NI number for me without myself having to go through a lot of hassle - thank goodness. Definately will just go with an umbrella company - seems like a fair bit less hassle!

So, even though I have a valid visa to work in the UK, and will be living there, I will still be considered a foreign non-resident? I imagine I need to return to Aus once a year or so to qualify.

phillrow - would you happen to have the contact of the person at CXC in Australia who was able to register to you before going to the UK? Or is it pretty common and they all know about it if I just ring up their helpline?

Thank you,
Mal

[phillrow]

There is a limit on how long your considered a foreigner for the contractor tax things. You can tax deduct your rent for the first 2 years and flights to/from your home country for the first 5....or something like that. CXC or the like will sort you out with up to date info on that.

The guy that I delt with at the Oz end was Adrian Bingham, he may or may not still be the man. As I was already contracting through them in Oz I just sent an email to my account manager who passed it on to him, so I'd say that if you did just ring their help line they'd sort you out.

I didn't use one of those starter companies myself for an NI number or a bank account. I think if need be CXC can help you out there too. You'll certainly need a letter from an employer to get your NI number (which CXC can provide). It was pretty straight forward to get the NI number, just ring up jobcentre, make an appointment and take your passport and the employer letter to your appointment at the jobcentre. For a back account what I did was register for a Passport account (Passport is for people moving to the UK) with HSBC before I went over there so opening a bank account wasn't a big issue. I suspect that CXC can also assist with UK bank accounts these days.....I don't think that they did when I went over. I do recall them sending out an email that they now have a UK banking partner or something to that effect. Maybe have a chat to CXC before you splash the $$ on a kit from one of those starter companies, they could probably cover it all for you now.