The great umbrella company scam

GB350

Here's the figures:
Net pay under CIS last week for 45hrs @ £13.31 per hr = £466.80.
Net pay under Umbrella company this week for 45 hrs @ £14.00 per hr= £388.76.
Inland revenue figures for a 45 hr week @ £14.00 per hr under PAYE

Your gross pay per week is £630.00


For the 2014-15 tax year we have estimated the following:



Per week Gross pay = £630.00
Income Tax£87.40
National Insurance£57.24
Total deductions£144.64
Your take home pay£485.36
Employer National Insurance£65.83

GB350

Apologies for the slightly garbled figures at the end of previous post. They didn't copy and paste quite like I was expecting.
£630.00 gross weekly earnings under PAYE would equal a take home pay of £485.36.
I am being had over massively and am now looking for another job......

getmore4less

you can edit posts if the formatting goes wrong.

getmore4less

What tax code are the umbrella using?

have they included the holiday pay or held it back?

Net pay under umbrella without expenses and margin would be £420

Have they processed the P45/6 or expenses.

GB350

They are using tax code 1000L and rolling up the holiday pay and offering it payable in addition to salary a week in hand. £73.33 taxed at 20% so around £58.67 added to the £388.76 would actually equate to around £447.43 so slightly more than £420.00. This figure is without any expense claims also although they would be minimal.
However it's nowhere near the figure I was clearing under CIS and with no rebate to look forward to either. My greatest annoyance is the fact that seemingly under PAYE I would be far better off.
I appreciate your interest in this thread.

GB350

I'm now getting fed up venting my own fury on this site and these will probably be my last words on the subject of Umbrella companies.
Whatever way I do the math on this it always comes down to the same thing...Employers NI. The Main Contractors don't want to pay it. They don't want to pay the agencies any more in order for them to be able to uplift the rates being paid to the workers to accommodate it. Consequently the main contractors , agencies & payroll companies are hoping the workers will bend over and take a 13.8% pay cut on their behalf... The agencies and payroll companies continued existence basically depends on this. I suspect this isn't exactly what the government envisaged when they introduced the new onshore intermediaries legislation in April. Unfortunately , due to a fair amount of ignorance and misinformation being fed to those on the ground it would seem a lot of people are being had over. I refuse to be one of them.

AbbieCadabra

have you contacted your local MP? i always thought they were a waste of time but one helped me get something sorted recently. worth a try surely?

GB350

I contacted my local MP Tobias Ellwood earlier on this year with regard to another piece of incredibly ill thought out and draconian legislation. I refer to the law change meaning parents are now unable to take their kids out of school at any time other than official school holidays.
In a nutshell his opinion was that this was ok as it would mean cheaper subsidised holidays at all other times for singletons and old people. They are obviously the ones who drive our economy.
As useful as a teapot made from chocolate..........
Thanks for the suggestion anyhow....

GB350

Well I've won my own personal battle with the main contractor. I proposed a solution whereby they could add the requisite hours to my weekly timesheet to compensate for the Employers NI which I'm now having to pay for them. They were agreeable to this as I'm guessing its pretty easy for them to pass off a few extra hours in a week rather than implement a change in the rate of pay. It's not an ideal solution as this also means that the agency will reap an undeserved benefit. However, for me personally, the status quo is now resumed.

System

GB350 wrote: »

I'm now getting fed up venting my own fury on this site

Aren't we all.

GB350 wrote: »

these will probably be my last words on the subject of Umbrella companies..

Unfortunately it wasn't