Reply to: Don't understand my umbrella pay slip

[LisaContractorUmbrella]

I would be extremely concerned by the fact that your umbrella company can't explain things to you in a way that is satisfactory to you. As Steve says there is no way that your umbrella company should be putting through expenses for you without evidence that a cost has been incurred and that it is allowable. Umbrella Companies do not determine what expenses are allowable and which are not, it is the HMR&C and they are not best chuffed when people get it wrong!

[Steven@Parasol]

To answer a few of the more recent questions. I didn't choose to go with the umbrella agency, I chose to apply for a contract position through a recruitment agency, when I got the job I was then told that I had to be paid through their sister company.

I don't necessarily trust them whether it benefits me or not. I was prepared to send in receipts for lunch etc until I was told that I don't need to. As I said in the OP I've never worked in this way before I've always been perm and I'm only doing this until something else comes along, but want to make sure I'm getting paid correctly.

Any umbrella company that tells you you don't need to keep your reciepts is simply lying I'm afraid and you can't be forced to work with a particular umbrella. You are free to change at any time.

Some of the dodgy umbrellas will tell you that they have a dispensation with HMRC so you can claim a certain amount of travel and subsistence expenses without reciepts. This is not true.

All the dispensation is is an agreement between the umbrella and HMRC in that the umbrella can process a certain amount of expenses and HMRC does not need to see reciepts. Its simply an agreement to reduce admin. HMRC can ask to see your reciepts at any time though so only claim for what you've spent and always keep reciepts.

Re the extra deduction from your payslip, without more info iots hard to say but this could be the employer's NIC. Umbrella contractors pay both employer's and employee's NIC but the rates are usually uplifted to reflect this. The umbrella should have told you this?

[jaymmu]

So you will trust them when it benefits you?


I could tell you that you can automatically claim £500 per week in accomodation expenses without actually leaving your house, but it doesn't mean that its true....

To answer a few of the more recent questions. I didn't choose to go with the umbrella agency, I chose to apply for a contract position through a recruitment agency, when I got the job I was then told that I had to be paid through their sister company.

I don't necessarily trust them whether it benefits me or not. I was prepared to send in receipts for lunch etc until I was told that I don't need to. As I said in the OP I've never worked in this way before I've always been perm and I'm only doing this until something else comes along, but want to make sure I'm getting paid correctly.

[blacjac]

I've never had to submit a receipt for anything apart from parking as I've been told that I automatically get £6 per day for lunch without submitting anything.

Yes I've asked them but to be honest I'm not that great with finances so didn't understand some of what I was told. Also, I don't entirely trust them so wanted another opinion.

So you will trust them when it benefits you?


I could tell you that you can automatically claim £500 per week in accomodation expenses without actually leaving your house, but it doesn't mean that its true....

[JamJarST]

Yes I've asked them but to be honest I'm not that great with finances so didn't understand some of what I was told. Also, I don't entirely trust them so wanted another opinion.

If you don't trust them, why the hell are you using them

[Sockpuppet]

Yes I've asked them but to be honest I'm not that great with finances so didn't understand some of what I was told. Also, I don't entirely trust them so wanted another opinion.

Well telling us what they've said might give us a clue as to whether its ok or not. Otherwise as I said before we are just guessing.

[jaymmu]

Have you still not asked your umbrella instead of us guessing?

Yes I've asked them but to be honest I'm not that great with finances so didn't understand some of what I was told. Also, I don't entirely trust them so wanted another opinion.

[Sockpuppet]

Have you still not asked your umbrella instead of us guessing?

[jaymmu]

I've never had to submit a receipt for anything apart from parking as I've been told that I automatically get £6 per day for lunch without submitting anything.

In the first week, I didn't even know I was working through an umbrella so I didn't claim any expenses and I still got approx £140 deducted as claimed expenses.

[craig1]

Could be Employers NI plus that holiday pay plus their fees.

[Support Monkey]

Yes I've claimed some, but not as much as is deducted. Here's a breakdown of the figures for this week:
Payments
Salary = 542.41
Holiday = 58.54
Subsistence = 30.00
Travel = 42.00

Deductions
PAYE tax = 81.20
NI = 32.10
Claimed Expenses = 194.23

Net pay = 365.42

I was thinking perhaps that the claimed expenses deduction might be paid back monthly, does this sound right?

Surely and i could be wrong, why are they paying you holiday, should this not be a deduction that they take then pay it back when you have a holiday (unless you actually took a holiday/day off that week)

and a payment for lunch thats not allowed each day unless you have the receipts to prove it

sound like you would be better going to an umbrella thats legal

[Wanderer]

£194.23 is a large deduction

Yeah. Wow. Did you really SPEND £194.23, like a third of your income on expenses in a week? What were the expenses?

[Greg@CapitalCity]

I think a phone call to your umbrella is in order. £194.23 is a large deduction that you should make them explain to you - I can't see the logic to it myself with the info you have supplied.

[mudskipper]

Hi, I've just started working in a contract role and the recruitment company automatically started paying me through their umbrella company. I've now received my first weekly payslip and am really confused. I understand that I receive my hourly rate, an amount for lunch and my holiday pay. Then tax and NI is deducted which is fine, but then there's a deduction called claimed expenses which is about a fifth of my gross salary.
In total my net wage is coming out at about 60% of the gross figure.

Can somebody explain what the claimed expenses deduction is please?

"amount for lunch" and "holiday pay" - this may be where the confusion lies. This is unlikely to be free - you're paying for it - also be aware that it's only claimable if you have a receipt to prove it.

[jaymmu]

Have you claimed any expenses?!

Yes I've claimed some, but not as much as is deducted. Here's a breakdown of the figures for this week:
Payments
Salary = 542.41
Holiday = 58.54
Subsistence = 30.00
Travel = 42.00

Deductions
PAYE tax = 81.20
NI = 32.10
Claimed Expenses = 194.23

Net pay = 365.42

I was thinking perhaps that the claimed expenses deduction might be paid back monthly, does this sound right?