Temping & getting paid - options?

MatyMoo

I have been paid via payroll most of my working life so have little experience of temporary agencies and how they work.

I am just about to finish my 1st contract where I have put in a weekly time sheet and got paid the following friday. As I went along I accrued holiday pay so when I wanted time off I put in a holiday form & got paid as normal (assuming I had enough available holiday accrued. Just like being fully employed by a business.

My second contract is with a different agency and they have asked how I want to be paid. I can be paid via them and accrue holiday at x per hour or I can be paid via a limited company at x +10% and hour. The 10% covers holiday pay apparently.

Has anyone come across this? How am I better to be paid? What happens to tax & NI if I go via the Ltd company?

Russe11

Holiday entitlement is 12.07%, so 10% more will be less than the PAYE anyhow.

Then if you are effectively employing yourself you need to pay the employers NI as well.

Then there is the payroll processing fee.

Unless you have lots of expenses then I would say its not worth it.

Being self employed rarely suits low paid workers, i'd take PAYE and employer pays expenses every time if the wages are low per hour.

The only other way I could see it being beneficial it to get the taxable income down and then claim tax credits amongst other benefits.