24 month rule and multiple contracts with different jobs (same client)

[Foxy Stoat]

Okay look, have I finally got this right in that I only owe on the tax of the erroneous expenses? If so, what is the percentage? Twenty percent? Thirty percent?

The way my umbrella company literature reads, it sounds like the whole thing is tax. But if not, then I only owe a couple of hundred. Can I not just ask my umbrella company to take it out of my next month's pay packet, and then that's me sorted?

[malvolio]

Okay look, have I finally got this right in that I only owe on the tax of the erroneous expenses? If so, what is the percentage? Twenty percent? Thirty percent?

The way my umbrella company literature reads, it sounds like the whole thing is tax. But if not, then I only owe a couple of hundred. Can I not just ask my umbrella company to take it out of my next month's pay packet, and then that's me sorted?

I know I'm going to regret this...

The way unbrellas work it is that they effectively deduct your cliameable expenses from your gross "salary" (i.e. your rate x time worked), calculate the tax due on that balance then deduct that amount from your gross. A bit left-handed but it keeps the sums simple. If you've mis-claimed you really neeed to submit an SAR in January to declare your earnings accurately and Hector will adjust your following year's tax code to adjust it out or send you a bill.

It's not really your umbrella's problem to resolve, but you could always try asking them. If, as it seems, you're paying them more than I pay my accountant, they ought to be able to offer some kind of assistance.

[Wanderer]

But none of the examples apply to my situation, it is somewhat unique. The only real semi-constant is the location I travel to (which by the way, is not in London), and even then it was not a certainty I would becoming back. That location was my temporary workplace, I left it, got a new job and now this is once again my temporary location, on a brand new 12 month contract, with a subsidiary company.

What matters is the location. Working for multiple clients doesn't reset the clock, it's only moving location that does. Also understand the 40% rule.

Okay look, have I finally got this right in that I only owe on the tax of the erroneous expenses?

The way my umbrella company literature reads, it sounds like the whole thing is tax. But if not, then I only owe a couple of hundred. Can I not just ask my umbrella company to take it out of my next month's pay packet, and then that's me sorted?

Funny how umbrellas give people that impression that all their expenses are "paid for" by the umbrella when actually they just reduce your taxable income...

[moggy]

What matters is the location. Working for multiple clients doesn't reset the clock, it's only moving location that does. Also understand the 40% rule.



Funny how umbrellas give people that impression that all their expenses are "paid for" by the umbrella when actually they just reduce your taxable income...

I'd be surprised if thats true wanderer, the only people who think that umbrellas pay their expenses are first timers or people who should never be contracting. most people realise how it works and if they don't then they should be asking.

[Foxy Stoat]

I agree with Wanderer, I've been with a couple of umbrellas over the last few years, and they all gave me this impression. They don't communicate the actualities very well.

Anyhow thanks to everyone for the help, working out the sums it's not a huge amount now, so I'll liaise with my umbrella and will get things sorted. Thanks for your kind advice.

[jmo21]

I'd be surprised if thats true wanderer, the only people who think that umbrellas pay their expenses are first timers or people who should never be contracting. most people realise how it works and if they don't then they should be asking.

It's only the first timers they catch by being vague. 2nd time with a brolly, I'm pretty sure even the idiots have learned.

[LisaContractorUmbrella]

Can I just point out here that not all brollies should be tarred with the same brush