Reply to: Umbrella confusion!!!!!!!

[ASB]

The negative net worth isnt necessarily a problem. It doesn't indicate it is operating at a loss. All it indicates is that historical cap ex has exceeded historical retained profits.

E.g. spend 50k on infrastructure early on.

Of course it can be indicative of issues but the headline figure is no more than a warning.

It may be worth heeding though in the absence of full accounts to ascertain why.

[missinggreenfields]

Well I'd be careful if I were you - that company only has £100 to its name according to Companies House. Where's the rest of the money gone?

There are a few things that ring alarm bells for this one:

• 2015 accounts shows a net worth of -£10281 (total assets £49355, total liabilities £59636)
• No VAT number on the website but they are VAT registered though (GB174021733) so they don't seem to understand the law about things like that
• I'd be wary of using someone who doesn't seem to be an accountant (or at least doesn't mention anything about being certified or anything like that) in the preparation of my accounts.

Each to their own and I hope that they don't disappear with the money - but I'd be running away from an umbrella company that is making that much of a loss, to be honest.

(Interesting fact - one of their directors is a director of the British Olympic Association with Seb Coe et al)

[cojak]

Hi,

I also found it confusing when I started out and found that when I contracted through different agencies they would tell me I could only use certain Umbrella Companies and usually they were expensive!

Eventually I settled with Umbrella Fella and they've been great so far, I originally used the PAYE option but they've recently set me up with my own limited company which means they still take care of all my payroll, I no longer have agencies telling me who to use and my take home is better!

It's still a mine field out there though so good luck, this is just my experience and it's up to you who you use but I got fed up with being told who to use by the aqencies and constantly having to swap payroll companies when I changed assignments.

Well I'd be careful if I were you - that company only has £100 to its name according to Companies House. Where's the rest of the money gone?

[TheITguy]

Umbrella Company

Hi,

I also found it confusing when I started out and found that when I contracted through different agencies they would tell me I could only use certain Umbrella Companies and usually they were expensive!

Eventually I settled with Umbrella Fella and they've been great so far, I originally used the PAYE option but they've recently set me up with my own limited company which means they still take care of all my payroll, I no longer have agencies telling me who to use and my take home is better!

It's still a mine field out there though so good luck, this is just my experience and it's up to you who you use but I got fed up with being told who to use by the aqencies and constantly having to swap payroll companies when I changed assignments.

Hello all,

Very new to this and the contractor environment, I work freelance via an agency was approached by a few umbrella companies, one being Extra, and what appears to be a subsidiary, Winchester (?). After researching, and using this forum as a really useful source of info, I understand they base there payment structure around loans in order to avoid paying 100% tax or at least less, which sounds more than a bit dodge. So I sacked that idea and went looking around including the AUCAE consortium.

I looked at their advice and I made a decision to go with a company who are able to offer more money, as they operate in a slightly different way to others umbrella companies as well as providing accounting for limited companies etc. The micro ltd option resolves any issues with working in the public sector, as i dip ion and out of that carrying out IT work, but it doesn't come into effect until April anyway but it's better to get ahead of the game. Ultimately HMRC and never going to rest until we're all forced out of contracts and subjected to the same deductions as everyone else which is unfair and going

I was advised at the time of joining that the AUCAE is a monopoly of umbrella companies that are pretty fixed and rigid in terms of the way they represent their contractors.

Would anyone have any advice? As to be fair, I cant be bothered with the uncertainty and worry that I may be liable for doing something wrong, after what i consider to be a fair amount of due diligence researching etc, and may end up just setting up my own ltd company with an accountant to avoid the nonsense etc.

Also is there ANY objective sites, forums etc that offer impartial reviews of umbrella companies? As each area I've researched is either clearly set up for a group of companies’ advertisement purposes or a collective group of companies with a different set of agendas.

Many thanks.

[lucyclarityumbrella]

We will be at the IR35 Public Sector Round Table on 6th September, so will feedback any info we get, but as you all say it appears to be pretty much a done deal, as with the T&S changes. We attended those too and it remained exactly as expected they had already concluded that around 80% of contractors would be caught!

[northernladuk]

Scary days indeed for contracting.
I wonder what QDOS et al. will do then. Probably that explains why they are moving into accounting, etc. business model? (so they can slowly phase out the IR35 related business from their portfolio).

I don't think the PS consultation is the reason QDOS went it to accounting. Something more along the lines of the number of contractors that cross their threshold every day so makes sense to create a spin off service.

[LondonManc]

Let's hope so.

Ideally it'll all go tits up on the public sector side next summer and will never get near the private sector. If it does reach private sector, I may well end up going back to perm and get the training, paid sick, holiday pay, etc.

[cojak]

Quite a while. They'll look at it, but banks and other big players will push back.

Either that or it will all be undone within six months.

Let's hope so.

[LondonManc]

...and how long before you think it's going to apply to the private sector as well?

Quite a while. They'll look at it, but banks and other big players will push back.

Either that or it will all be undone within six months.

[Milkyway]

...and how long before you think it's going to apply to the private sector as well?

Oh OK. You were talking about all in public sector! Understood.

That said, as you say, if this will also soon apply to private sector, that is a worry then!
I will certainly have to think about slowly stopping my consulting/contracting work ,and increase my dependency on my software product development / sales business as my mainstream income flow (from current 65/35 => to almost 100% from product development and 0 from consultancy/contracting).

Scary days indeed for contracting.
I wonder what QDOS et al. will do then. Probably that explains why they are moving into accounting, etc. business model? (so they can slowly phase out the IR35 related business from their portfolio).

[cojak]

...and how long before you think it's going to apply to the private sector as well?

[eek]

What is that all about?? HAVE to be?? Seriously??
Govt. linky please!

https://www.gov.uk/government/consul...es-legislation

For consultation read done deal with the slight possibility of very minor changes.

It will impact all work in the public sector. Example 3 shows how it would impact consultancies - which some hoped would provide a get out clause

[northernladuk]

What is that all about?? HAVE to be?? Seriously??
Govt. linky please!

She ia talking about Public Sector. Plenty of links on here and google if you have a look.

[Milkyway]

in April 2017 almost all contractors will probably have to be inside IR35 and pay PAYE

What is that all about?? HAVE to be?? Seriously??
Govt. linky please!

[jamesbrown]

251 for a day's work. 65 pound paid by the umbrella, whistles off to the accountant....

Is the industry regulated? Apart from other members of the industry.

There's really no difference between legitimate umbrella companies, other than their margin (and, obviously, their customer service), because the legislation is fixed. Hence "All Umbrella Companies Are Equal (AUCAE)". So when you see substantial differences between companies, you know that one or more are trying to rip you off, introduce dodgy assumptions, or knowingly lead you down a path that will end in your bending over to HMRC, or perhaps all three.

This really isn't rocket science. It's incredibly simple. If you're working through a legitimate umbrella company, it's PAYE or nothing. That means full employer's and employee's National Insurance contributions too. You should expect to retain something like ~55-65% of your income, depending on your earnings.

If you can't understand this (quickly), you're probably not a legitimate poster.