Reply to: Lost at sea...Inside IR35.what % should I expect to take home?

[kysto]

Happy to have a chat and explain it to you kysto.

Hey Lucy,

Thanks, As i said nothing is on concrete yet but should it be, I'll be in touch.

[eek]

HMRC providing some definitive guidelines and approval for umbrella's might be a start, rather than a "sorry we cannot advise on whether this way of operating is compliant or not" answer - but then again pigs have a better chance of flying!

Now may be a good time to start pushing for that as the Taylor review officially condones the work umbrellas do....

[lucyclarityumbrella]

I just wish I knew what the solution was. Holding agencies responsible for any lost tax feels like just about the only option.

HMRC providing some definitive guidelines and approval for umbrella's might be a start, rather than a "sorry we cannot advise on whether this way of operating is compliant or not" answer - but then again pigs have a better chance of flying!

[eek]

This sounds like a normal day in the office for me - same old conversation, I have this is on repeat!

I just wish I knew what the solution was. Holding agencies responsible for any lost tax feels like just about the only option.

[lucyclarityumbrella]

One thing I learned during the process, is that few umbrella companies said that I can claim expenses etc upon submission of receipts. But they also said, I need to workout and tell them a fixed number as an expense ahead. This number is fixed and cannot be changed. That fixed amount will be deducted and any balance will be kept by the umbrella. For e.g. if you project your monthly expense as £1000, umbrella will deduct this and pay you based on your receipts. If your receipts are worth £400, you will be deducted £1000, you get paid £400, the balance £600 would be taken by them. I guess they call it as fixed expense model or something. But I felt it was bit fishy, so didn't go with that option.

As far as our legal support was concerned, operating in this way meant that if they tried to repay the expenses, it could be deemed an unlawful deduction of earnings, hence they are not paid back - in my mind completely wrong and the contractors are even worse off

[lucyclarityumbrella]

There is no such thing as an "enhanced Tax efficient umbrella" what there is are normal umbrellas and smooth talking scam artists who will take 10-15% of your money and leave you with a blooming large tax bill 1-5 years away and a long term black mark in your records within HMRC...

This sounds like a normal day in the office for me - same old conversation, I have this is on repeat!

[kysto]

I think he is being fasi faceshu fashes taking the piss.

Would seem that way! either that he was using the same calculator he did to negotiate the role he left in 24hrs

[lucyclarityumbrella]

Hey,

Thanks for your reply, I'll be sure to have a look at the threads and company mentioned above. It's actually a TA role and not a BA, so 300 is about the going rate in Scotland, however inside IR35 looks like it could be a bugger, if the 62/64% net is to be believed.

Happy to have a chat and explain it to you kysto.

[jamesbrown]

£550-575 a day

Determined by the number of screw ups each day?

[northernladuk]

thanks for your reply and sorry I don't quite understand what you mean by £6.70 after tax?

I think he is being fasi faceshu fashes taking the piss.

[kysto]

A month ago I too accepted a TA role, inside IR35, at £550-575 a day. When working out take home, it was roughly £350 (approx) outside IR35. Needless to say, I left it within 24 hours.

One thing I learned during the process, is that few umbrella companies said that I can claim expenses etc upon submission of receipts. But they also said, I need to workout and tell them a fixed number as an expense ahead. This number is fixed and cannot be changed. That fixed amount will be deducted and any balance will be kept by the umbrella. For e.g. if you project your monthly expense as £1000, umbrella will deduct this and pay you based on your receipts. If your receipts are worth £400, you will be deducted £1000, you get paid £400, the balance £600 would be taken by them. I guess they call it as fixed expense model or something. But I felt it was bit fishy, so didn't go with that option.

I have a feeling that being inside, your day rate is way too low. Are you sure you will be getting at least £6.70 after tax deductions?

thanks for your reply and sorry I don't quite understand what you mean by £6.70 after tax?

[northernladuk]

We just agreed to terminate the contract. Wise move from the client (saved money by not paying for the notice period) + I didn't charge for that one day.

Bet they thought you were a right pillock. No wonder they agreed.

[Brummie]

So you started work before realising and then just left the client in the lurch?

We just agreed to terminate the contract. Wise move from the client (saved money by not paying for the notice period) + I didn't charge for that one day.

[northernladuk]

A month ago I too accepted a TA role, inside IR35, at £550-575 a day. When working out take home, it was roughly £350 (approx) outside IR35. Needless to say, I left it within 24 hours.

So you started work before realising and then just left the client in the lurch?

[Brummie]

... I would also like to know what % other contractors take home as net pay.

A month ago I too accepted a TA role, inside IR35, at £550-575 a day. When working out take home, it was roughly £350 (approx) outside IR35. Needless to say, I left it within 24 hours.

One thing I learned during the process, is that few umbrella companies said that I can claim expenses etc upon submission of receipts. But they also said, I need to workout and tell them a fixed number as an expense ahead. This number is fixed and cannot be changed. That fixed amount will be deducted and any balance will be kept by the umbrella. For e.g. if you project your monthly expense as £1000, umbrella will deduct this and pay you based on your receipts. If your receipts are worth £400, you will be deducted £1000, you get paid £400, the balance £600 would be taken by them. I guess they call it as fixed expense model or something. But I felt it was bit fishy, so didn't go with that option.

I have a feeling that being inside, your day rate is way too low. Are you sure you will be getting at least £6.70 after tax deductions?