Umbrella company...

[tequilamock]

I am about to start a short term contract via an agency, and have been advised to be paid via an umbrella company to secure a higher hourly rate, as well as claim expenses.

Does anyone know anything about this?

Also, what expenses can I legitimately claim? Travel to and from work? Lunches?

Thanks

[mazamoo]

umbrella's are ok if you are a builder or crane driver or you get over 8 quid an hour.
i am currantly paid by one and it is awful, they have not payed my tax or ni but pay them selves very handsomly.£19 a week! you will pay employers ni aswell.i claim for fuel ,carparking,meals etc. last week i claimed a total of 54ish and they gave me 157,one week i claimed for 60ish and they gave me 5.oh and the most complicated wage slip you will ever see in your life. Some are better than others but be carefull, they disgise selfemployment as employment with somesort of loophole. once i end this contract i will never use an umbrella company ever again. but thats just me ,your experiance my differ so just look into it carefully. good luck

[boxtops]

Can't the agency pay you directly?
I have never known a job where you can claim for travel to the place of work, or for your lunch - that's not in most people's terms and conditions!

[mazamoo]

oh forgot to mention, your expenses are offset, you are not "paid" your expenses.this is just to reduce your tax liability. you will not actually get the money back.

[tequilamock]

This certainly isn't how it's described by Parasol. There is also a calculator which shows the amount you'll be 'paid' each week. Please have a look. Agency advised I do this, as I keep more of the money than if I'm paid by them. Rate is £15 per hour and Parasol take £14 per week. Thanks

[tequilamock]

And I CAN claim travel to and from work, lunches and all other legitimate business expenses.

[ummmm]

You can't claim 'lunches' if you work in the same town as you live. Well not with HMRC anyway.

[mazamoo]

you are on a decent hourly rate so it should work out better for you. they will be sent a gross from your agency, take their cut take out the expenses you claimed for then take the other deductions then add back in your expenses at the end . it is this part that boosts your pay, they ofset it against your tax liability so you pay less. if you incured 60 in expenses and your tax is 80 you only pay 20.
with me i was only able to be paid directly if i had a ltd company, with i dont, so it was the only way to get paid.

[mazamoo]

you should ring and ask about the expenses that you can claim for as they probably
do things differently. did the agencey reccommend parasol?

[tequilamock]

Thanks. Yes, the agency did recommend Parasol. It all seems pretty straight forward. All expenses (including lunch) are deductable. The job is 60 miles from home, but I don't think it matters where you're based - lunch (and breakfast, and dinner - if you do actually need to) are all claimable.