UmbrellaReclaim - anyone used this?

[lucyclarityumbrella]

It's unlawful if they deduct it from your day rate.

It's unlawful if they deduct it from your taxable salary.
All down to how it was sold to the individual in the first place. I think one umbrella company went under not that long ago for effectively telling the contractor that they were paying for it!

[malvolio]

It's unlawful if they deduct it from your taxable salary.
All down to how it was sold to the individual in the first place. I think one umbrella company went under not that long ago for effectively telling the contractor that they were paying for it!

Yes, true. However more than one agency is advertising the day rate as your gross rate which is, of course, being treated as your taxable salary...

[eek]

Yes, true. However more than one agency is advertising the day rate as your gross rate which is, of course, being treated as your taxable salary...

Yep and that's unfixable as umbrella rate is so widely used and abused that you can't do anything about it.

[lucyclarityumbrella]

Maybe someone needs to come up with a way of standardising the terms in the industry

[malvolio]

Maybe someone needs to come up with a way of standardising the terms in the industry

Maybe a trade body with a close interest in the freelance world should be taking more of an interest in the use of umbrellas than they have done in the past. But I'm not holding my breath...

However, I have been pondering this issue a little. The thought occurred that the necessary factors are all known - umbrella income from their upstream clients, umbrella outgoings in net personal pay to downstream clients, RTI returns from the umbrella covering taxes paid, RTI returns for the individual downstream clients. With a little disclosure by the umbrella over fees charged it can't be too difficult to check that the taxes being handed over are in close alignment to the actual monies changing hands...

HMRC then jump hard on the heads of any showing a major deviation from the mean. And the esteemed FCSA loses its whole raison d'etre.

[DolanContractorGroup]

Maybe a trade body with a close interest in the freelance world should be taking more of an interest in the use of umbrellas than they have done in the past. But I'm not holding my breath...

However, I have been pondering this issue a little. The thought occurred that the necessary factors are all known - umbrella income from their upstream clients, umbrella outgoings in net personal pay to downstream clients, RTI returns from the umbrella covering taxes paid, RTI returns for the individual downstream clients. With a little disclosure by the umbrella over fees charged it can't be too difficult to check that the taxes being handed over are in close alignment to the actual monies changing hands...

HMRC then jump hard on the heads of any showing a major deviation from the mean. And the esteemed FCSA loses its whole raison d'etre.

Hi malvolio,

HMRC has had this information for at least half a decade or more. RTI was introduced in 2013, so compliant umbrellas have been providing HMRC payment information for employees since then. Then, after the onshore intermediaries legislation was introduced in 2015 with the 'employment intermediaries reporting requirements' that recruiters had to now do, HMRC has a full picture of what monies go up and down the supply chain.

The problem is that the more unscrupulous providers (umbrella or recruiter) may not even be providing this information to HMRC and so HMRC won't have the full picture here.

There were even whispers when the 2015 reporting requirements first started that HMRC does not have the resources to even look at all this new information, let alone start enforcement action.


Thanks

Zeeshan

[BenDover]

https://www.express.co.uk/finance/pe...swer-questions

[eek]

https://www.express.co.uk/finance/pe...swer-questions

Given the sector that person works in I suspect the issue isn't so much IR35 and deductions of employer NI as the umbrella firm being as dodgy as f***....

[lucyclarityumbrella]

There were even whispers when the 2015 reporting requirements first started that HMRC does not have the resources to even look at all this new information, let alone start enforcement action.

They do now - I know that for certain

[lucyclarityumbrella]

However, I have been pondering this issue a little. The thought occurred that the necessary factors are all known - umbrella income from their upstream clients, umbrella outgoings in net personal pay to downstream clients, RTI returns from the umbrella covering taxes paid, RTI returns for the individual downstream clients. With a little disclosure by the umbrella over fees charged it can't be too difficult to check that the taxes being handed over are in close alignment to the actual monies changing hands...

They just need a calculation to give a ball park figure, if the umbrella receives X reported via the agency reporting, linked by NI number, umbrella pays Y, umbrella margin is negligible, would just need to figure out how to take pension amounts into consideration.