Huge difference in take-home pay between umbrella PAYE and agency PAYE

[Amanensia]

The daily rate is the same for both, but the take-home pay figure is substantially less for agency PAYE, because the agency doesn't deduct Employer's NI, apprenticeship levy and an admin fee, whereas the umbrellas do.

Do you mean substantially more?

[NFH]

Do you mean substantially more?

Yes. I've corrected that error. Thanks.

[mjcp]

Sounds like a balls up by the agency - take their PAYE and then refer to the contract if its less on arrival!

My last gig was an agency PAYE FTC. The advertised day rate was ~£110 less once the contract arrived for signature; this being the various deductions for the "employer costs".

As others have stated, the only difference should be the Umbrella fee (only other things that might have an impact: holiday pay if they pay it out rather than accrue it and pensions, agency might auto enroll you, brolly might assume opt-out)

M

[GhostofTarbera]

Your net pay will be 52-54% of the gross daily rate (you will get more for the 1st few months as will more than likely be wrong tax code)


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[eek]

The daily rate is the same for both, but the take-home pay figure is substantially more for agency PAYE, because the agency doesn't deduct Employer's NI, apprenticeship levy and an admin fee, whereas the umbrellas do.

So take the agency payroll option and be prepared to see rather less money when your payslips arrive. But don't tell the agency anything until towards the end of the contract and then kick off a tribunal claim.

[eek]

Your net pay will be 52-54% of the gross daily rate (you will get more for the 1st few months as will more than likely be wrong tax code)


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Not if the agency has screwed up the PAYE Key information document which is sounds like they have...

[ComplianceLady]

Definitely an error and as someone who is constantly working to correct and prevent said error's it's more common than it should be for agencies that don't 'do' PAYE as bread & butter. I wrote something about it here IR35: Engagement types There's an image in it which is useful to explain rates - sorry don't know how to include it here.

And if they know ANYTHING they won't deduct NI. They'll terminate your contract and offer you a new one.