EMPLOY-E expenses scam.

Bruciebonus

Hope someone can shed some light on this for myself and my work mates.

I currently work in a factory,employed by an agency,on minimum wage.Up untill this week we were getting paid through an umbrella company called EMPLOY-E.Thats all changd this week and were now getting paid by another umbrella company.On my pay slip I pay no tax and very little NI and get 'expenses' deducted from my pay instead even though Ive never asked for expenses(or was told about them)When I questioned the agency about this I was told we would be better off because of doing it this way by a few quid each week.However one of my work mates recently found tis article indicating that its all a scam to get EMPLOY-E and the agency extra income from us......http://blogs.mirror.co.uk/investigations/2011/08/we-put-legal-es-tax-dodge-for.html.
I asked the agency if there was any way of getting this money back from EMPLOY-E as rightfully its ours and after dodging the question a couple of times and getting angry she said I would have to contact EMPLOY-E and see what they say.
Im just intested if anyone has been successful in relaiming misclaimed expenses like these or if we stand a chance of a refund?

(Oh and to complicate things further we have only been with this current agency for two months having been with another one for six months then told,not asked,that we had to move to this new one)

Russe11

As long as there are workers willing to put up with these sorts of practices, then they shall continue.

Umbrella companies are not suited to low earners with no expenses.

Sounds like they are just using the allowed dispensation expense amounts(pocketing it), not having the Employers NI to pay and possibly charging a fee for the service.

Are you accuring holiday entitlement?

Have you actually checked the sums to make sure you are better off?

If they have moved you from one company to another its likely they are looking to wind up the previous umbrella, don't really need to state the reasons why they would do this!

Was you never offered a PAYE option when you took the job?

Bruciebonus

It was either accept these conditions or go on the dole so there was no option in my eyes.

''Umbrella companies are not suited to low earners win no expenses.''
Explain please''

Yes we get holidays.

Ive not checked the sums because I have no idea how to.

Not sure if I was offered a PAYE option when I first took the job but was yesterday.Also have the option to opt out and go to PAYE at any time too.Im gonna wait till my next pay slip and see what differnce this new company makes to the actual money I get in my pocket.

Russe11

Bruciebonus wrote: »

''Umbrella companies are not suited to low earners win no expenses.''

sorry should say with not win, have corrected it now.

well put the figures up and it can soon be worked out, but then I gather you won't know what the PAYE rate will be if you have been getting a umbrella rate?

Or is it simply NMW?

What is the umbrella rate?

keyser666

Sounds like they are moving from the old EMPLOYE-E umbrella name to a new compay name because of the bad press they have had

withabix

Umbrella schemes need to be closed down.

They are nothing more than tax evasion.

Russe11

withabix wrote: »

Umbrella schemes need to be closed down.

They are nothing more than tax evasion.

not quite, it does suit some workers who are classed as selfemployed and incurr the expenses of having that status.

what should be shut down is those that should be paye and not being paid anymore by going through a unmbrella that makes the margins better for both parties.

they are not evasion as the law allows this practice to take place, it is avoidance and the rules are bent a bit to far by some.

keyser666

Russe11 wrote: »

not quite, it does suit some workers who are classed as selfemployed and incurr the expenses of having that status.

what should be shut down is those that should be paye and not being paid anymore by going through a unmbrella that makes the margins better for both parties.

they are not evasion as the law allows this practice to take place, it is avoidance and the rules are bent a bit to far by some.

Spot on .

Firefox1975

Bruciebonus wrote: »

Hope someone can shed some light on this for myself and my work mates.

I currently work in a factory,employed by an agency,on minimum wage.Up untill this week we were getting paid through an umbrella company called EMPLOY-E.Thats all changd this week and were now getting paid by another umbrella company.On my pay slip I pay no tax and very little NI and get 'expenses' deducted from my pay instead even though Ive never asked for expenses(or was told about them)When I questioned the agency about this I was told we would be better off because of doing it this way by a few quid each week.However one of my work mates recently found tis article indicating that its all a scam to get EMPLOY-E and the agency extra income from us......http://blogs.mirror.co.uk/investigations/2011/08/we-put-legal-es-tax-dodge-for.html.
I asked the agency if there was any way of getting this money back from EMPLOY-E as rightfully its ours and after dodging the question a couple of times and getting angry she said I would have to contact EMPLOY-E and see what they say.
Im just intested if anyone has been successful in relaiming misclaimed expenses like these or if we stand a chance of a refund?

(Oh and to complicate things further we have only been with this current agency for two months having been with another one for six months then told,not asked,that we had to move to this new one)

What makes you believe you would be better off without the Umbrella agency?

You cannot claim these "expenses" unless you are either under an umbrella agency, or working through a Limited company?

if you were taxed through PAYE you would lose out on 22% of your wage (after your monthly allowance) surely if you are paying no tax at all now, you will be worse off?

in your working environment, these "expenses" do not exist, you cannot claim your dinner and you cannot claim for any travel allowance to work.

cammo2000

yes i have (until recently) experienced this exact same issue with employ-e. the expences issue, and lower than expected tax and n.i payments. i was advised by co-workers, do not question it because i would suddenly not be given any work at my long term work placement. the option i have now taken, which the agency is ok with, is set up a limited company as a contractor. invoice the agency weekly/monthly the `fee` for your services i.e the hours you have worked, and now my £25,000 annual wage now becomes company turnover, and me and my wife can both each earn £8500 (your tax-free allowance), and the remainder as a tax-free dividend. plus a load of recipts for stuff! even with agencies `in-house`accountants fees and minimal corporation tax, im a lot better off! sounds complicated, but as long as the agency is happy doing it this way, its fine! just make sure an accountant does the paperwork!!!!!!! get out of employ-e!!!!!!

keyser666

cammo2000 wrote: »

yes i have (until recently) experienced this exact same issue with employ-e. the expences issue, and lower than expected tax and n.i payments. i was advised by co-workers, do not question it because i would suddenly not be given any work at my long term work placement. the option i have now taken, which the agency is ok with, is set up a limited company as a contractor. invoice the agency weekly/monthly the `fee` for your services i.e the hours you have worked, and now my £25,000 annual wage now becomes company turnover, and me and my wife can both each earn £8500 (your tax-free allowance), and the remainder as a tax-free dividend. plus a load of recipts for stuff! even with agencies `in-house`accountants fees and minimal corporation tax, im a lot better off! sounds complicated, but as long as the agency is happy doing it this way, its fine! just make sure an accountant does the paperwork!!!!!!! get out of employ-e!!!!!!

Sounds like you will be in IR35 territory doing it that way with a divi