Hey everyone
New to this forum, new to contracting too - so hopefully I can come here for advice when I need it and give advice out as I learn myself.
I got my first contract in September. It has been extended twice now and currently I'm working until May.
As it was my first contract, and I didn't know what to expect, I went with an Umbrella company (Atlantic) and have been with them since. Thankfully, I think I know now that contracting is right for me - so I do plan to go Limited soon.
That being said, Atlantic have provided me monthly with an itemised payslip since September, which makes sense for the most part. It has tax, NI, pension, expenses etc. The only thing that doesn't make sense is an item on there called "Agreed Deduction". This month, it was just under £1000. This is NOT my agreed monthly fee with Atlantic (which is £89) - this is entirely separate.
I've totted up this "Agreed Deduction" and in total thus far it has come to £4200+. Obviously, quite a bit of money that I've never seen.
Does anyone know what this is? I've asked Atlantic, and they said "this is always worked out at 13.8% of your period gross for tax and is the same for all contractors. The amount is to cover employment costs consisting mainly of employers national insurance with a small amount set aside to cover any statutory entitlements."
That doesn't make sense to me... where have they got the 13.8% from?
Can anyone shed some light in layman's terms? Should I be charged this "Agreed Deduction"? Who is that money going to? I've only agreed to give Atlantic £89!
New to this forum, new to contracting too - so hopefully I can come here for advice when I need it and give advice out as I learn myself.
I got my first contract in September. It has been extended twice now and currently I'm working until May.
As it was my first contract, and I didn't know what to expect, I went with an Umbrella company (Atlantic) and have been with them since. Thankfully, I think I know now that contracting is right for me - so I do plan to go Limited soon.
That being said, Atlantic have provided me monthly with an itemised payslip since September, which makes sense for the most part. It has tax, NI, pension, expenses etc. The only thing that doesn't make sense is an item on there called "Agreed Deduction". This month, it was just under £1000. This is NOT my agreed monthly fee with Atlantic (which is £89) - this is entirely separate.
I've totted up this "Agreed Deduction" and in total thus far it has come to £4200+. Obviously, quite a bit of money that I've never seen.
Does anyone know what this is? I've asked Atlantic, and they said "this is always worked out at 13.8% of your period gross for tax and is the same for all contractors. The amount is to cover employment costs consisting mainly of employers national insurance with a small amount set aside to cover any statutory entitlements."
That doesn't make sense to me... where have they got the 13.8% from?
Can anyone shed some light in layman's terms? Should I be charged this "Agreed Deduction"? Who is that money going to? I've only agreed to give Atlantic £89!
Comment