Reply to: Parasol expenses cover sheet

[LisaContractorUmbrella]

maybe they are just hibernating and will re-appear in spring?

Aaahhhh like likkle hedgehogs

[original PM]

maybe they are just hibernating and will re-appear in spring?

[LisaContractorUmbrella]

I think you were right not to hold your breath Zippy

[Zippy]

Good question Zippy - do you want me to wait with you

Nah - thanks though. I'm sure you have plans for the rest of your life

[LisaContractorUmbrella]

I assume 'purchase price' includes VAT? So would Parasol be able to claim any of this back? Would this purchase increase the 'employment costs' (which I believe are applied before the deduction of legitimate business expenses)?
I'm not holding my breath for a reply here ..

Good question Zippy - do you want me to wait with you

[Zippy]

I assume 'purchase price' includes VAT? So would Parasol be able to claim any of this back? Would this purchase increase the 'employment costs' (which I believe are applied before the deduction of legitimate business expenses)?
I'm not holding my breath for a reply here ..

[LisaContractorUmbrella]

Surely it is the same deal? The umbrella company have effectively bought the laptop by re-imbursing your cost. You don't have income from the contract; the Umbrella do and they choose to pay you a salary which is reminiscent of the post-employer's NI, but doesn't have to be (I'm sure somewhere in your employment contract there will be mention of some bonus you are paid in addition to a basic salary and the calculation of that bonus will involve the subtraction of expenses due).

It seems to me a lot of these questions stem from people not grasping that the contract isn't theirs when they go via an Umbrella, it is between the Umbrella and the end client.

Having said that, the umbrella I use for my contract don't operate this kind of policy (it seems this is being offered as a perk so you can buy a laptop effectively bypassing NI and tax) and I imagine it starts to blur the line a bit too much?

I think I understand the way that an umbrella contract works However, in this case there is no reimbursement of cost in reality and the purchase is not made by the umbrella company so they have no legal entitlement to the property and certainly no entitlement to 10% of the purchase price which would seem to be the case in this instance

[bobof]

But the difference is that I think the company paid for the bike

Surely it is the same deal? The umbrella company have effectively bought the laptop by re-imbursing your cost. You don't have income from the contract; the Umbrella do and they choose to pay you a salary which is reminiscent of the post-employer's NI, but doesn't have to be (I'm sure somewhere in your employment contract there will be mention of some bonus you are paid in addition to a basic salary and the calculation of that bonus will involve the subtraction of expenses due).

It seems to me a lot of these questions stem from people not grasping that the contract isn't theirs when they go via an Umbrella, it is between the Umbrella and the end client.

Having said that, the umbrella I use for my contract don't operate this kind of policy (it seems this is being offered as a perk so you can buy a laptop effectively bypassing NI and tax) and I imagine it starts to blur the line a bit too much?

[LisaContractorUmbrella]

Just thought I'd pop back to this thread to see if any explanations had miraculously appeared - sadly not

[moggy]

Fair point. How do ContractorUmbrella deal with this? If I was working through you and I needed a laptop that was essential for my role, not for personal use etc. as per your website I could claim the cost back. How would you get the money to pay me the expenses?

they would use the funds they bill you out for.

[Apox21]

But the difference is that I think the company paid for the bike

Fair point. How do ContractorUmbrella deal with this? If I was working through you and I needed a laptop that was essential for my role, not for personal use etc. as per your website I could claim the cost back. How would you get the money to pay me the expenses?

[LisaContractorUmbrella]

I seem to remember from my days a permie that there were similar rules with regard to cycle to work schemes etc. i.e. the company owned the bike then after a set period you could either hand the bike back or pay the market rate for the bike (which was about 5 or 10%). so would assume they're operating under similar tax rules (I may be wrong)

But the difference is that I think the company paid for the bike

[northernladuk]

I seem to remember from my days a permie that there were similar rules with regard to cycle to work schemes etc. i.e. the company owned the bike then after a set period you could either hand the bike back or pay the market rate for the bike (which was about 5 or 10%). so would assume they're operating under similar tax rules (I may be wrong)

Thanks but assuming things and comparing to different schemes isn't really helping anyone.

[Apox21]

I think we are aware of that. The HMRC policy on wholly and exclusively is well documented. The key argument is the 10%.

I seem to remember from my days a permie that there were similar rules with regard to cycle to work schemes etc. i.e. the company owned the bike then after a set period you could either hand the bike back or pay the market rate for the bike (which was about 5 or 10%). so would assume they're operating under similar tax rules (I may be wrong)

[northernladuk]

It looks to me that Parasols policy on equipment isn't much different to other umbrella companies policy on equipment apart from the 10% deposit:

Parasol

"The costs of hardware, software and personal protection equipment essential to your role can be claimed. There’s no limit to the amount that can be claimed, although you must complete the sundry letter provided detailing how each purchase supports your role, along with the original receipt. Claiming the full cost of any purchase requires a security deposit* equivalent to 10% of the purchase price to be paid. The equipment will become the property of Parasol, with the option to purchase it after a qualifying period at a second-hand value assumed to be equal to 10% of the purchase price.* The 10% deposit will deducted from your net pay following your authorisation."


ContractorUmbrella

"Claims for equipment must be supported by evidence that they are specifically required for your current contract and that the equipment is wholly necessary for you to perform the assignment. Any general pieces of equipment for your role as a contractor or ‘nice to haves’ are not permitted by HMR&C."

I think we are aware of that. The HMRC policy on wholly and exclusively is well documented. The key argument is the 10%.