Surely this can't be legal/moral?

[wim121]

Funny last but one contract i had i was told i HAD to use Parasol.So your comment about an agent not forcing you to use a particular agency is total botty water.

Were you told what the consequences would be if you didn't go along with it?

I know exactly what djshuggg means. Some give you a list of "preferred umbrellas", some dictate you have to use their agreed one.

The consequences if you don't go along with it Lisa is they won't give you the assignment and might not bother offering you any in the future. Some may be able to afford to pass up work, but a lot of us just have to get in bed with the devil and hope everything works out.

Some agencies may say when pressed, they will pay you through your own limited company if you have one.

[Tanya@SC Lee Accountant Ltd]

Your agent is business people so they just want to get more commission from their preferred umbrella to get more money out of you.

I know exactly what djshuggg means. Some give you a list of "preferred umbrellas", some dictate you have to use their agreed one.

The consequences if you don't go along with it Lisa is they won't give you the assignment and might not bother offering you any in the future. Some may be able to afford to pass up work, but a lot of us just have to get in bed with the devil and hope everything works out.

Some agencies may say when pressed, they will pay you through your own limited company if you have one.

[Steven@Parasol]

Your agent is business people so they just want to get more commission from their preferred umbrella to get more money out of you.

Rubbish, we for one do not pay referrals to agents in any shape or form.

We are on the majority of PSLs though because of our compliance track record and membership of the FCSA. Its about protection and risk mitigation, not profit.

[LisaContractorUmbrella]

Rubbish, we for one do not pay referrals to agents in any shap or form.

We are on the majority of PSLs though because of our compliance track record and membership of the FCSA. Its about protection and risk mitigation, not profit.

Ditto (although not FCSA) bit. Most umbrella companies are now vary wary of becoming involved with paying referal fees because of the anti-bribery legislation that was published recently - any payment that is deemed to influence the decision of the agency could be considered to be a bribe.

[Dave Copeland]

Legal Moral

Firstly I am new around this topic and contracting generally and hope I am in copmpliance with forum rules in posting this. My problem is that I have been offered a contract which must be run through a Ltd. Co. or umbrella. Speaking with an accountent yesterday I was offered a tax planning strategt which without naming the supplier I can describe as below

A UK company invoicves client.
I am an employee of the UK company.
I get paid minumum wage through PAYE
Balance of income is held in trust (IOM Trustees)
Trust rules are that trust can only operate for my benefit.
Each month I borrow my income from the trust.
The loan is never repaid
They forecast net to me of 81% of contact value.

Seems great but I am nervous re the "loan" and "trust" elements.

Does anyone have experience of such schemes or comment generally

Thanks

[LisaContractorUmbrella]

Firstly I am new around this topic and contracting generally and hope I am in copmpliance with forum rules in posting this. My problem is that I have been offered a contract which must be run through a Ltd. Co. or umbrella. Speaking with an accountent yesterday I was offered a tax planning strategt which without naming the supplier I can describe as below

A UK company invoicves client.
I am an employee of the UK company.
I get paid minumum wage through PAYE
Balance of income is held in trust (IOM Trustees)
Trust rules are that trust can only operate for my benefit.
Each month I borrow my income from the trust.
The loan is never repaid
They forecast net to me of 81% of contact value.

Seems great but I am nervous re the "loan" and "trust" elements.

Does anyone have experience of such schemes or comment generally

Thanks

You should be nervous - please refer to the BN66 thread in Accounting and Legal

[DaveB]

Firstly I am new around this topic and contracting generally and hope I am in copmpliance with forum rules in posting this. My problem is that I have been offered a contract which must be run through a Ltd. Co. or umbrella. Speaking with an accountent yesterday I was offered a tax planning strategt which without naming the supplier I can describe as below

A UK company invoicves client.
I am an employee of the UK company.
I get paid minumum wage through PAYE
Balance of income is held in trust (IOM Trustees)
Trust rules are that trust can only operate for my benefit.
Each month I borrow my income from the trust.
The loan is never repaid
They forecast net to me of 81% of contact value.

Seems great but I am nervous re the "loan" and "trust" elements.

Does anyone have experience of such schemes or comment generally

Thanks

a contract which must be run through a Ltd. Co. or umbrella

This is not a problem, it is normal practice.

Talk to another accountant, one of the ones who post on here would be a good start (Nixon Williams, SJD, InTouch are the ones I can think of right now).

Anything involving offshore trusts, currency exhange schemes or which promises to return 80% or more of your day rate should, IMO, be avoided at all costs.

Probably 90% of the people on this forum operate under the Ltd Co. + Accountant route, the rest generally use a brolly or do their own accounts.

[Dave Copeland]

Thanks for the comments so far. I would be interested also to get feedback from anyone who has used such a scheme. Can anyone advise if the forum rules prevent me from giving details of the company. Dave

[Wanderer]

Thanks for the comments so far. I would be interested also to get feedback from anyone who has used such a scheme.

I'm sure they have lots of satisfied customers. What the customers don't know is that 6 years down the line they could get investigated, the off shore company disappears into thin air (along with their "guarantees") and the contractors may get lumped with a huge tax bill. You may get away with it but these schemes are widely considered to be risky.

[Dave Copeland]

Thanks to those who responded. I am now talking with an accountant to go the Ltd. Co. route.

I like to sleep at night. Dave