Umbrella Company - Holiday Pay - Contractor UK Bulletin Board

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LisaContractorUmbrella replied

7 May 2015, 08:57
As everyone has said - yes - the money that will be paid to you is classed as taxable income as it would be in any other employment
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sal replied

7 May 2015, 08:36
Originally posted by Sausage Surprise View Post

Hmmm...

That's why

Originally posted by northernladuk View Post

Stay brolly.

+1

OP doesn't seems to have much clue what it means to operate through your own ltd.
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Sausage Surprise replied

7 May 2015, 08:03
Originally posted by Ribeye27 View Post

I've been contracting through an umbrella company for the last 6 months. During this time I've built up a tidy sum in holiday pay which they have been holding back. I have now decided to go limited company. The umbrella company now wants to take out National Insurance and PAYE from my holiday pay before passing it on to me.

My question is, as I am now self employed and therefore responsible for my own tax affairs, is it right that they should do this ?

Hmmm...
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slatt replied

7 May 2015, 07:35
Yes, the money they put into your holiday pot comes from your pre tax earnings, so when they pay it out they need to tax it in the normal way.

You can't take it as "new" income and account for it as part of your Ltd company as it was earned during your employment through the umbrella.

Last edited by slatt; 7 May 2015, 07:36. Reason: spelling
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northernladuk replied

6 May 2015, 19:24
Stay brolly.
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cojak replied

6 May 2015, 18:42
They have to pay holiday pay and NI up to the point that you worked for them.

This is the way Umbrellas work.
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stek replied

6 May 2015, 18:36
Yes
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Ribeye27 started a topic Umbrella Company - Holiday Pay

6 May 2015, 16:29
Umbrella Company - Holiday Pay

I've been contracting through an umbrella company for the last 6 months. During this time I've built up a tidy sum in holiday pay which they have been holding back. I have now decided to go limited company. The umbrella company now wants to take out National Insurance and PAYE from my holiday pay before passing it on to me.

My question is, as I am now self employed and therefore responsible for my own tax affairs, is it right that they should do this ?
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