Paystream - "Employers Costs on Holiday Pay"

[eek]

Not sure it's relevant but was interesting speaking to Paystream today. They offered to pay me my holiday pay upfront so I don't get paid when I'm off or they can keep it and pay me. I've indicated I want it all now but am waiting for someone to explain it in more detail before I finalise it.

Not seen this mentioned before on the forums I dont think.

Advanced holiday pay (i.e. receiving it immediately when you are paid for the week you've just worked) is something we've discussed multiple times here - usually when someone complains about an umbrella stealing it.

The only reason why holiday pay should be being retained by an umbrella is because the worker wants that done for their own personal reasons - it really should always be paid in advance because it removes the possibility of shenanigans occurring.

[northernladuk]

Advanced holiday pay (i.e. receiving it immediately when you are paid for the week you've just worked) is something we've discussed multiple times here - usually when someone complains about an umbrella stealing it.

The only reason why holiday pay should be being retained by an umbrella is because the worker wants that done for their own personal reasons - it really should always be paid in advance because it removes the possibility of shenanigans occurring.

This was my thinking hence taking the money upfront.

[lucyclarityumbrella]

Umbrella's are likely to offer both options; advanced or accrued. If you opt for the accrued, then the likelihood is all taxes are taken when it is accrued, so the monies that sit there are yours when you take annual leave. As we have seen before if anyone opts for this then make sure either at the end of the holiday year (see contract), or at then end of the assignment, that you request it all to be paid back out to you.

[DrStrange]

The PayStream FAQ suggests that accrued holiday pay is taxed when paid and not when accrued.

Is there a maximum one can accrue?

I'm wondering if there's a possibility of deferring income across tax years if so...

(I'm guessing this angle won't work, but as always I like to check with folks more knowledgeable to find out why)

[eek]

The PayStream FAQ suggests that accrued holiday pay is taxed when paid and not when accrued.

Is there a maximum one can accrue?

I'm wondering if there's a possibility of deferring income across tax years if so...

(I'm guessing this angle won't work, but as always I like to check with folks more knowledgeable to find out why)

Nope because if you don’t take the holiday within the holiday year - it’s perfectly legal for the umbrella to take the money as profit at the end of the holiday year.

If you are a contractor just insist on holiday pay being paid upfront that works out cheapest

[lucyclarityumbrella]

Nope because if you don’t take the holiday within the holiday year - it’s perfectly legal for the umbrella to take the money as profit at the end of the holiday year.

Albeit, this is now frowned upon across the board, so am hoping this won't be the case moving forwards!