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Parasol - Employment Costs - extra charges??

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    #81
    We are actually in the process of changing our systems for the new tax year. At the moment we have 2 solutions but going forward we will have one whereby the Employers costs can be flexed to make a provision for extra statutory costs where there is considered to be a risk. In many cases there will be no provision.
    Each client is taken on by a Client Advisor who runs through a live Personal Illustration. The CA has discretion on "fees" and provisions and obviously the client has to effectively agree the net take home pay before proceeding.
    I am still considering additional disclosure, albeit we have to be aware of the total absence of transparency from many competitor companies and a general lack of understanding within the industry as a whole.

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      #82
      It has been a while since I have been involved in brollies so things may have changed but is it not the case that

      1) When you are employeed by a brolly your permanant place of work is the brollies head office.
      2) Therefore based on 1 you can claim expenses for your travel to and from where you actually perform the contract as it is not legal to claim travel expenses to your permanent place of work (thus the 2 year rule in which case your contract place of work becomes classed as your permanent place of work and so you can no longer claim the travel expenses)
      3) If therefore you are between contracts in order to be paid you would actually have to turn up at the brollies head office - who would be olbliged to pay you minimum wage for any hours worked - as there is also no job description attached to your contract of employment with the brolly they could legitimately put you to work doing anything for them.
      4) Given that 3 is highly unlikely to happen therefore there is said to be an unwritten agreement between you and the brolly that you are taking unpaid leave (which is perfectly legal if both parties agree) and so the liability for the brolly to pay you when you are not on contract becomes a mute point (unless you really want to turn up on their doorstep and clean the loos!)

      So it would seems that while any increase in fees could be seens as covering them in this eventuality the reality is the brolly knows they are pretty safe and so it is just a bit of extra profit for them. However as they are taking this 'profit' out of the money which they earn from the agency for the work you have done and the brolly ensure they pay you minimum wage for the hours earned it is unlikely they are doing anything illegal. You could argue that it is morally wrong but since when was that a reason for people not to rip other people off?

      But as I say I am a year or two out of touch...

      Comment


        #83
        Have received my payslip after Parasol promised to reimburse me, which they have done fully for the monthly overcharges since October last year. The Employment Costs are now correctly calculated based on 'er NI and pension contributions only - with no extra charges, I REPEAT...no extra charges!

        I don't know if Parasol have put things right just for me 'cos I complained, or for everybody. I would urge Parasol clients to check their payslips and raise it with them if not.

        Comment


          #84
          Originally posted by original PM View Post
          It has been a while since I have been involved in brollies so things may have changed but is it not the case that

          1) When you are employeed by a brolly your permanant place of work is the brollies head office.
          2) Therefore based on 1 you can claim expenses for your travel to and from where you actually perform the contract as it is not legal to claim travel expenses to your permanent place of work (thus the 2 year rule in which case your contract place of work becomes classed as your permanent place of work and so you can no longer claim the travel expenses)
          3) If therefore you are between contracts in order to be paid you would actually have to turn up at the brollies head office - who would be olbliged to pay you minimum wage for any hours worked - as there is also no job description attached to your contract of employment with the brolly they could legitimately put you to work doing anything for them.
          4) Given that 3 is highly unlikely to happen therefore there is said to be an unwritten agreement between you and the brolly that you are taking unpaid leave (which is perfectly legal if both parties agree) and so the liability for the brolly to pay you when you are not on contract becomes a mute point (unless you really want to turn up on their doorstep and clean the loos!)

          So it would seems that while any increase in fees could be seens as covering them in this eventuality the reality is the brolly knows they are pretty safe and so it is just a bit of extra profit for them. However as they are taking this 'profit' out of the money which they earn from the agency for the work you have done and the brolly ensure they pay you minimum wage for the hours earned it is unlikely they are doing anything illegal. You could argue that it is morally wrong but since when was that a reason for people not to rip other people off?

          But as I say I am a year or two out of touch...
          Definitely shouldn't be any ripping off going on if everything is being operated correctly - the umbrella company should be deducting nothing other than their margin and their employer's NI obligation from the B2B agreed rate before processing the gross salary for the individual. Although a deduction may be made for holiday pay this is reimbursable either when the individual takes holiday or at the end of the year - none of it should be retained by the umbrella company.

          HTH
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            #85
            Parasol Employment costs

            Originally posted by fred857 View Post
            Have received my payslip after Parasol promised to reimburse me, which they have done fully for the monthly overcharges since October last year. The Employment Costs are now correctly calculated based on 'er NI and pension contributions only - with no extra charges, I REPEAT...no extra charges!

            I don't know if Parasol have put things right just for me 'cos I complained, or for everybody. I would urge Parasol clients to check their payslips and raise it with them if not.
            Thanks for relating your experiences. I'm new to all this and was "interested" to find that they had taken almost as much in "Employment costs" as I'd paid in tax -- with minimal explanation anywhere.

            I'll let you know when and if I hear back from them.

            Cheers

            Comment


              #86
              Parasol "Employment Costs"

              Originally posted by The Spartan View Post
              There's a few people on here who been screwed by Parasol's "Employment Costs" the best thing to do is leave and spread the word to anyone else who uses their service
              Thanks - probably exactly what I'M going to do as well.

              Comment


                #87
                Parasol employment cost

                Im as well very annoyed by Parasol employment cost deductions!

                That's what they say in the email they sent to me:

                Parasol will make the necessary deductions from your pay. These deductions are your tax and National Insurance contributions, the Parasol margin of £27.50 per week, and we also retain an amount to cover ‘Employment Costs’.

                Employment costs cover Employers' National Insurance Contributions (NIC) which is currently calculated at 13.8%. We calculate this once we have deducted expenses, the margin and the Employers’ NIC free allowance of £153.00 as you’re on a weekly pay period.

                Then i spoke to them on the phone and they explained that everyone charge that when you are umbrella company employee and this money is being charged by HMRC and not PARASOL!

                Did anyone had some help and how to resolve this!!!!

                Many thanks for your help!

                Comment


                  #88
                  Did you not expect to pay tax & national insurance?

                  Comment


                    #89
                    Indeed. Gitanak received just under 63% from his total, which is around average for umbrellas I believe.

                    I don't know how expensive Parasol is commision-wise, but that is the only area where they differ. EVERY reputable umbrella will subtract NI and tax (and pass it onto HMRC, obv...)
                    "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
                    - Voltaire/Benjamin Franklin/Anne Frank...

                    Comment


                      #90
                      Originally posted by gitanak View Post
                      Im as well very annoyed by Parasol employment cost deductions!

                      That's what they say in the email they sent to me:

                      Parasol will make the necessary deductions from your pay. These deductions are your tax and National Insurance contributions, the Parasol margin of £27.50 per week, and we also retain an amount to cover ‘Employment Costs’.

                      Employment costs cover Employers' National Insurance Contributions (NIC) which is currently calculated at 13.8%. We calculate this once we have deducted expenses, the margin and the Employers’ NIC free allowance of £153.00 as you’re on a weekly pay period.

                      Then i spoke to them on the phone and they explained that everyone charge that when you are umbrella company employee and this money is being charged by HMRC and not PARASOL!

                      Did anyone had some help and how to resolve this!!!!

                      Many thanks for your help!
                      When you work with an umbrella company, you are their employee which means that your earnings are subject to PAYE - Income Tax and Employee's National Insurance. As they are your employer they are legally obliged to pay Employer's National Insurance which will be deducted from the contract value, along with the umbrella company margin, before your salary is calculated. The other thread that you started states that you previously had your own Ltd Co - the tax and NI position working with an umbrella company is pretty much the same as if you were working through your own Ltd inside IR35.
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