Nursing agency, paye or ltd?

milliemonster

Thanks but because of my main job, all my tax allowance is used on that anyway, (I'm on around £21k pa in this job paye, this is already pro rata's to my part time hours), so anything I earn with the agency will be taxed from £1, I'm only planning to do around 12hrs a week with them, the pay rate is £18 per hr paye or £22 an hr ltd, but if I am having to pay £80 a month for the accountant, I can't see where it's beneficial to go ltd (although the agency keep telling me it is!), they haven't told me I can only use their accountant, although on my first email of scepticism, they have offered to reduce the accountant costs to £60 a month and they will pay the other £20

Prothet_of_Doom

So my very rough figures using http://www.uktaxcalculators.co.uk/

PAYE is worth £22380 approx in your hand and you pay to get to work out of that
Assuming accountancy Cost of £500, Insurance of £400, 20 mile return trip to work at 45p a mile claimed, but only 22.5p a mile cost, you'll see about £24000 but for those 36 shifts the travel is paid.

So it's worth about an extra £2000 in your pocket.

Personally I think the agency might be suggesting using an umbrellor company, who will make it really simple, but you'll see less money in your pocket.

milliemonster

no they've said its not an umbrella company, it's definitely an accountant, and their charges are £100 set up cost and £80 a month which is £1060 pa, not £500 as you've quoted above, so in reality I'm going to save not even £1k a year based on those figures, and that commits me to working for them each month too, hmmm

chrismac1

Plus you have the very real risk of an IR35 status enquiry. Employment status is not a "choice" as your original post suggested. The contract terms can be:

Clearly employment, clearly self-employment or "in the grey area"

At least 10% of the UK workforce in my view - whether they know it or not - is in the "grey area". You'd be going from clearly PAYE to "in the grey area" and I'm amazed this issue has not been mentioned to you. I have some concerns here that you are being railroaded into something which might suit your employer but is not in your best interests.

If your employer is in the public sector, they really should know better as this is a hot topic now that key people in the BBC, HMRC, NHS trusts and so on have been found out to be "self-employed".

nomunnofun

Exactly chrismac1 - hence my post at #10 - the 'saving's really do not appear to make up for the potential pitfalls.