tax credits when with umbrella company

zagfles

shedboy94 wrote: »

This makes no sense......who the hell pays 25p tax on £228 gross income........and 72p in NI

It is your GROSS pay that needs to be declared.

Presumably you were only working for a few weeks in the year - that is why your income is so low?

Some of the pay is expenses and not taxable. His taxable pay was £145, which is only just above the personal allowance hence the low tax.

zagfles

OP - these articles may be of interest to you:

http://www.contractorfriend.co.uk/articles/umbrella_companies/view/expenses_dispensations_explained

http://www.shout99.com/contractors/showarticle.pl?id=68132;n=10

princessdon

My OH uses an umbrella co and it is the net pay on the p60.

As others have said "legitimate" expenses are not included - BUT your brolly should have warned you that any expenses you claim that are not receipted and sent in but you delcare as an expense are your responsbility. It's unikely (given your figures) but possible that you could be asked for proof further down the line. This doesn't include incidentals that are given as necessary if away from home.

carebear13

can i double check something, cos this thread got a little bit off the topic and i'm a bit confused. for tax credits is its the gross pay that i give or the year to date taxable pay that i give?

shedboy94

carebear13 wrote: »

can i double check something, cos this thread got a little bit off the topic and i'm a bit confused. for tax credits is its the gross pay that i give or the year to date taxable pay that i give?

It is the gross pay

http://www.hmrc.gov.uk/taxcredits/start/claiming/income-hours/employment-income.htm

Notmyrealname

shedboy94 wrote: »

This makes no sense......who the hell pays 25p tax on £228 gross income........and 72p in NI

It is your GROSS pay that needs to be declared.

Utterly wrong. It is your GROSS INCOME less TAX DEDUCTIBLE EXPENSES.

Notmyrealname

zagfles wrote: »

More of an idea than you, clearly. I know they're free of tax, but the employer needs to have a dispensation to pay them without declaring them. Try reading this and educate yourself:

http://www.hmrc.gov.uk/paye/exb/schemes/dispensation.htm

I'm self employed. I know all about it thanks.

Notmyrealname

carebear13 wrote: »

can i double check something, cos this thread got a little bit off the topic and i'm a bit confused. for tax credits is its the gross pay that i give or the year to date taxable pay that i give?

Taxable pay. Don't listen to the halfwits who say you have to declare the full gross. They don't know what they're on about.

Notmyrealname

shedboy94 wrote: »

It is the gross pay

http://www.hmrc.gov.uk/taxcredits/start/claiming/income-hours/employment-income.htm

You didn't understand what you read, did you? Try scrolling down the page.

You include certain benefits that you got from your employer that were taxed

You DO NOT INCLUDE work expenses you had to pay in doing your job - which related only to doing your job, and are deductible for Income Tax purposes.

Notmyrealname

carebear13 wrote: »

can i double check something, cos this thread got a little bit off the topic and i'm a bit confused. for tax credits is its the gross pay that i give or the year to date taxable pay that i give?

Taxable pay. Don't listen to the halfwits who say you have to declare the full gross. They don't know what they're on about.

Read the link that shedboy94 posted but didn't understand however unlike shedboy94, scroll down the page and it tells you what not to include.