Reply to: Stitch-Up by Umbrella?

[SueEllen]

The only problem is no one needs to keep records that long.

[DaveB]

Orange and Gold are still in business, they look like a standard Contractor Accountancy firm providing legitimate Brolly and accountancy services. No dodgy claims on take home or HMRC compliance.

You could always ask your current accountants to talk to them directly....

Orange & Gold Contractor Accountancy - Limited company services - IR35 - Umbrella company services

[LisaContractorUmbrella]

Apologies for being rude by answering a question with a question, but I think you've earned it; why not?:-)

What is the main reason for going with an umbrella? Therein lies your answer - and you certainly don't expect to walk away from an umbrella and being 8k in the hole as they manage you PAYE etc. It is possible that my accountants have made a mistake, which is why I am revisiting it with them, but I thought I would see if anyone else has been in the same position.

No, you wouldn't expect to walk away from an umbrella owing £8k so, as others have said, you were probably with a Managed Service Company or a tax avoidance scheme.

[SqueakyClean]

From a brief read, and if I've missed something apologies I'm only looking in whilst on holiday, something doesn't sit right here.

If you took the bank account with you (your words) then the entity, I.e., your company must have been the same as accounts cannot be transferred between entities.

In which case the original "umbrella" wasn't an umbrella, possibly a managed service company operator. I'm surmising when you left them, you simply changed accountant from one who did a lot (the MSC operator) to a more mainstream/typical type arrangement.

The money accountant 2 says you owed to the "business", presumably the company you had all along, sounds like it was an issue on directors account, from overdrawing dividend, salary or expenses.

Harsh though it sounds the moral is running a company gives obligations as well as benefits, one of the obligations is to understand the finances in outline. Without sounding rude, it seems you didn't do that. Asking now is a bit like shutting the gate after the horse has bolted.

That said if you are still with accountant 2, then they should be able to explain the issue. Don't accept a fob off on time elapsed.

Again, sorry if I've missed something.

You've not missed anything and thanks - been some help. I'm still trying to fit all the pieces together really and of course I understand the moral bit - this was a long time ago when I was new to contracting, hence the starting out with what I thought was an umbrella company. I have been with the same accountants now for the time between and I trust them and yes I do know how to run my business now.

Many thanks to all that tried to understand my position as much as I am trying to understand it now - 8 years ago! I've asked my accountants to open this can of worms up again so i'll take it from here.

bye.

[Jessica@WhiteFieldTax]

From a brief read, and if I've missed something apologies I'm only looking in whilst on holiday, something doesn't sit right here.

If you took the bank account with you (your words) then the entity, I.e., your company must have been the same as accounts cannot be transferred between entities.

In which case the original "umbrella" wasn't an umbrella, possibly a managed service company operator. I'm surmising when you left them, you simply changed accountant from one who did a lot (the MSC operator) to a more mainstream/typical type arrangement.

The money accountant 2 says you owed to the "business", presumably the company you had all along, sounds like it was an issue on directors account, from overdrawing dividend, salary or expenses.

Harsh though it sounds the moral is running a company gives obligations as well as benefits, one of the obligations is to understand the finances in outline. Without sounding rude, it seems you didn't do that. Asking now is a bit like shutting the gate after the horse has bolted.

That said if you are still with accountant 2, then they should be able to explain the issue. Don't accept a fob off on time elapsed.

Again, sorry if I've missed something.

[northernladuk]

I think I may have had a few short term contracts through them, and no the last one was only 3 months, I could have swapped in between contracts - the parting was not amicable......don't ask me what happened - can't recall

So what are you are you expecting from this thread? There is f*k all anyone can do for you if you can't remember the detail....

Did the accountant send you their account details and said just put it in there and they would pay it for you?? Bank in Leeds possibly?

[NickNick]

Sounds like it was a set up that went away with the MSC legislation back in 2006/7 (?)

[SqueakyClean]

Then what makes you think that you were 'stitched up' by an umbrella company

Apologies for being rude by answering a question with a question, but I think you've earned it; why not?:-)

What is the main reason for going with an umbrella? Therein lies your answer - and you certainly don't expect to walk away from an umbrella and being 8k in the hole as they manage you PAYE etc. It is possible that my accountants have made a mistake, which is why I am revisiting it with them, but I thought I would see if anyone else has been in the same position.

[LisaContractorUmbrella]

Sorry, so long ago I can't recall

Then what makes you think that you were 'stitched up' by an umbrella company

[cojak]

Sorry, so long ago I can't recall

Then in the words of the song, you really are going to have to let it go.

And treat it as a very hard lesson learned to
PAY ATTENTION!!

[SqueakyClean]

Were you using a proper umbrella company or were you using a tax avoidance scheme?

Did your tax code change in April 2005?

Did you claim a large amount of expenses?

Did you provide the umbrella company with a P45 when you joined them or did you fill in a P46?

What was your accountant's explanation? Could they have made an error?

Sorry, so long ago I can't recall

[SqueakyClean]

What was your situation client wise? Was your last gig as umbrella a long one? Did you swap mid client? Was the new client in the same area as the last umbrella gig?

I am wondering if there has been a hiccup over expenses and permanent place of work here.

I think I may have had a few short term contracts through them, and no the last one was only 3 months, I could have swapped in between contracts - the parting was not amicable......don't ask me what happened - can't recall

[SqueakyClean]

I know it was 8 years ago, but at the time when you were so shocked at that figure and asked the new accountant why? What did they say?

I could not explain it to the accountants as I did not know what the hell was going on. I could not account for where the 8k went as much as they could..........

[SqueakyClean]

Surely either you were working through your ltd-co or you were working through a brolly. It seems you were using a brolly to run your ltd-co which is an entirely different kettle of sea dwelling fauna.

From what I can recall, and yes I understand ignorance is not an excuse, It was an umbrella company called Orange and Gold (and by naming them does not infer negligence or liability on their part). Now they way they worked was that they set up a Ltd company called SPRO59 - they must have as I have a COI name change from that name to my current Ltd company name. What was bizarre (seemed so then) was that (as I recall) They opened up a RBS account for me not long after me joining them - apparently they did this for all their contractors i.e. flogged them to RBS for a commission no doubt. Strange thing is I had access to this account but I did not have control over it - it was in the umbrella's name. I retained the RBS account after moving to my own Ltd company name after leaving O&G, however, I have moved banks recently, never have I had to deal with such a shower of incompetent sh*ts as them! Awful customer service.

As mentioned I have let it go but now I am starting to take a lot more interest in my finances rather then just relying on my accountants to smooth everything out, as im really concerned about IR35 and April 2016 and what implications both will have on my personal income.

I hope that has provided answers to all your questions. I have asked my accountants just now to provide more info on where that 8k went i.e. what was it propping up.

Squeaky

[tractor]

....

Hi all,

Firstly - I'm a newbie and a lurker for all of 2 hours before joining - hello all! Great site here - got everything - comedic put-downs and everything but all done without malice and in good taste - I'm in!

So, back in 2004/2005 I first started contracting using an Umbrella. I fell out with them over something (probably very stupid) I can't remember what though. So I go the Ltd company route and get an accountant, and a change of name for the COI. Long story short, the accountants request all relevant accounts documentation from said Umbrella, which they duly provided. A month later I get a call from accountants saying that after reviewing my current financial situation, I owe my business £8000. I could never understand then (and now) how I could owe that much money when the Umbrella controlled what they paid me. in my ignorance and naivety, I paid up as I could not prove otherwise. This whole episode has been niggling me for the past 8 odd years - I begrudge all the hassle/red tape that is part and parcel of running a one man PSC, so paying additional money through possible no fault of my own makes me wanna puke just thinking about it.

I'm looking for advice on what could have happened - yes I have already had the conversation with my accountants, but they could not throw any light on it back then, and oh yes it's over 6 years ago so should I just 'get over it' or is there a way forward?

Thanks

Squeaky

I know it was 8 years ago, but at the time when you were so shocked at that figure and asked the new accountant why? What did they say?