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Employers NI, In or Out of rate?

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    Employers NI, In or Out of rate?

    I went perm in February on a good salary with a good firm. Sadly I just found out that I’m being made redundant as part of a restructure.

    After contracting for 20yrs previously, I’d not worked inside IR35, but will likely be forced to do so in the new world post my redundancy in November.

    Obviously one of the biggest hits is paying the employers NI, I’ve noticed rates are slightly down (obviously) right now, but are those advertised rates on JobServe Generally before the NI or after? I can’t seriously believe they are before?

    What are people’s experiences so far?

    #2
    Originally posted by MarkT View Post
    I went perm in February on a good salary with a good firm. Sadly I just found out that I’m being made redundant as part of a restructure.

    After contracting for 20yrs previously, I’d not worked inside IR35, but will likely be forced to do so in the new world post my redundancy in November.

    Obviously one of the biggest hits is paying the employers NI, I’ve noticed rates are slightly down (obviously) right now, but are those advertised rates on JobServe Generally before the NI or after? I can’t seriously believe they are before?

    What are people’s experiences so far?
    All are before

    Employer NI
    Holiday pay deductions
    Umbrella deductions
    Other

    Rule of thumb

    Take rate offered on JobServe and 52%-54% of that rate will be your NET rate into your personal bank account

    The biggest hit is actually expenses, as you can’t claim any


    Sent from my iPhone using Contractor UK Forum

    Comment


      #3
      Isn't it illegal to deduct employers NI from the rate? Not that it matters of course as they will simply say the rate is advertised rate - employers NI...

      Comment


        #4
        Originally posted by dsc View Post
        Isn't it illegal to deduct employers NI from the rate? Not that it matters of course as they will simply say the rate is advertised rate - employers NI...
        Yes it is technically but only relevant for public sector right now, and will be relevant for private sector April 2021.

        Comment


          #5
          Originally posted by jayn200 View Post
          Yes it is technically but only relevant for public sector right now, and will be relevant for private sector April 2021.
          I’ve spoken to a few friends who work in the public sector saying their rates were bumped up when the changes were made there a few years ago to cover that, so the chances are that public sector roles have the NI covered by the employer outside of the rate?

          Comment


            #6
            What does the key information document the agency should have given you say?
            merely at clientco for the entertainment

            Comment


              #7
              Originally posted by MarkT View Post
              I’ve spoken to a few friends who work in the public sector saying their rates were bumped up when the changes were made there a few years ago to cover that, so the chances are that public sector roles have the NI covered by the employer outside of the rate?
              Back then all of those public sector contractors could just leave and go work in the private sector, which is the main reason they had rate bump ups (after threatening to walk). With the private sector going through reforms now, there's nowhere to run, especially in the current market, so expect to take it on the chin or stay on the bench.

              Comment


                #8
                Originally posted by dsc View Post
                Isn't it illegal to deduct employers NI from the rate? Not that it matters of course as they will simply say the rate is advertised rate - employers NI...
                Actually it does. They should be advertising the rate to the worker from which Employee NICs and PAYE and holiday pay will be deducted (by them or the agency or umbrella). Employer's NICs and Apprentice Levy are the client's costs and not part of the worker's income at all.

                Falsely advertising the gross rate (i.e. before all deductions) is what Dave Chaplin has called the smurf rate - attractive but doesn't actually exist. It is also illegal under Section 10 if ITEPA. Even applying GoT's rule of thumb above doesn't work if you don't know the starting point.

                But then again, we are talking about agencies here. Truth is a variable concept...
                Blog? What blog...?

                Comment


                  #9
                  Originally posted by eek View Post
                  What does the key information document the agency should have given you say?
                  I am asking in principle, I am being made redundant and will go back to contracting, sadly inside, probably in November or January.

                  Comment


                    #10
                    Originally posted by dsc View Post
                    Back then all of those public sector contractors could just leave and go work in the private sector, which is the main reason they had rate bump ups (after threatening to walk). With the private sector going through reforms now, there's nowhere to run, especially in the current market, so expect to take it on the chin or stay on the bench.
                    Yeah that makes sense - trying to work out my take home pay from a contract via an umbrella is a bloody nightmare.

                    Comment

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