Agency Worker, rolling contract for almost 2 years..HELP!

m4ndy1966

taxsaver wrote: »

My point was that this HMRC rule does not give your employers an excuse to stop paying you the expenses that you incur, so be careful that they don't use the HMRC rules as an excuse to save themselves money.

However, where at the moment you get paid all your expenses in full without any deductions, after the 24 months Giant would have to deduct tax and national insurance from your expenses before paying them to you just as they do with your salary.

I hope that clarifies things and is helpful to you.

....when you say "be careful .....etc" what do you mean? In what respect?

SteProud

m4ndy1966 wrote: »

....when you say "be careful .....etc" what do you mean? In what respect?

I work for an umbrella company so I am not inmpartial. Ourselves and Giant are founding members of the industry association that oversees our industry though so we share the same basic principles.

The two year rule basically means that, once you have been contracted to the same location for 24 consecutive months, HMRC has decided that your entitlement to some of your expenses is reduced. All this means is that you can’t claim travel and subsistence (food for lunch etc) costs anymore.

Unfortunately this is going to reduce the amount of take home pay you earn as you’ll have less business expenses being offset against how much tax you pay, but there are a couple of things you might be able to do to soften the blow.

First of all, make sure you are claiming for all the legitimate business expenses that you can. You may be entitled to more than you think so have a chat with Giant.

Secondly, have you thought about setting up your own limited company? This is another option that could help minimise how much tax you pay. There are online calculators you can use to find out how much you would be better off.

We tend to advise that if you are earning more than £35K a year you would be better off down the Limited route, IR35 depending.