Advice please (contractor pay)

[DennisNedry]

Hi guys, just looking for a bit of advice.

 

I'm working as a contractor (directly employed by the agency Reed), but get paid through an umbrella company called Paysure. I've been paid for 4 weeks work.

 

I was looking at my payslips and realised that I'm £58 down overall on what I should have been paid (for the 4 weeks cumulative). I rang up Paysure and they told me that because Reed were late authorising my pay for one week, 2 weeks wages went through in one go. As a result, I got clobbered by the higher rate of tax. They say there's nothing they can do. Reed so far have ignored my calls.

 

I think it's really unfair that I should be penalised for something that isn't my fault. £58 is a lot of money to me. Do I have a leg to stand on here or is it just 'one of those things'? 

[Dr The Singh]

The tax will adjust itself at the end of the tax year, I believe

[DB11]

It's just one of those things but you'll get a rebate at the end of the financial year

[fuchsntf]

2 hours ago, DennisNedry said:

Hi guys, just looking for a bit of advice.

 

I'm working as a contractor (directly employed by the agency Reed), but get paid through an umbrella company called Paysure. I've been paid for 4 weeks work.

 

I was looking at my payslips and realised that I'm £58 down overall on what I should have been paid (for the 4 weeks cumulative). I rang up Paysure and they told me that because Reed were late authorising my pay for one week, 2 weeks wages went through in one go. As a result, I got clobbered by the higher rate of tax. They say there's nothing they can do. Reed so far have ignored my calls.

 

I think it's really unfair that I should be penalised for something that isn't my fault. £58 is a lot of money to me. Do I have a leg to stand on here or is it just 'one of those things'? 

Paysure, isnt quite the Correct name Sort of contradiction in itself

.Normally a top firm , just like a permanent contract, work out the variables, 

and pay you as A monthly contractor.Might have changed since my day I worked many years for various

W.Wide technical agencies

, they wouldnt of dared to cross their contractors, we were highly asked for.

Our normal hrs were payed within 72hrs on presentation of timeslips, wwide.Even when double (umbrella) contracted.

Overtime a month later.

Ex Younger International Workmates, use to say preliminary 1st 2nd wages, might differ, but once clarity, plus and minus

were corrected instantly.

I used to pay my Own  taxes, if you are having reductions from source...sorry no idea.

Other than that I would ask to have them sort it out, or find another idiot.  I and others did have the clout.

But then..agencies just wouldnt play silly buggers with their  Contractors..reputation and so on.

Today too many cowboys who are too lazy.

[fuchsntf]

I submitted too early...

In UK it was possible to use citizens advice bureau, for tax consultants, or contact to local govt. Services..

Try them..

[Manwell Pablo]

3 hours ago, DennisNedry said:

Hi guys, just looking for a bit of advice.

 

I'm working as a contractor (directly employed by the agency Reed), but get paid through an umbrella company called Paysure. I've been paid for 4 weeks work.

 

I was looking at my payslips and realised that I'm £58 down overall on what I should have been paid (for the 4 weeks cumulative). I rang up Paysure and they told me that because Reed were late authorising my pay for one week, 2 weeks wages went through in one go. As a result, I got clobbered by the higher rate of tax. They say there's nothing they can do. Reed so far have ignored my calls.

 

I think it's really unfair that I should be penalised for something that isn't my fault. £58 is a lot of money to me. Do I have a leg to stand on here or is it just 'one of those things'? 

 

Back in the early days of my contracting days I paid over the odds on tax for about two years without realising and one day a cheque for 2k landed on my doorstep. It's not uncommon. Umbrella companies are terrible for getting your tax right if you are new to the game. 

 

I dunno what your on but anything more than 150 a day you should set yourself up as a ltd (if contracting is something your going to stick at) company, it's not so much someone getting your tax right or wrong then as you pay no income tax and corporation tax is charged at a much lower rate and you get a bill to pay as opposed to having it taken directly.

[syston_fox]

7 minutes ago, Manwell Pablo said:

 

Back in the early days of my contracting days I paid over the odds on tax for about two years without realising and one day a cheque for 2k landed on my doorstep. It's not uncommon. Umbrella companies are terrible for getting your tax right if you are new to the game. 

 

I dunno what your on but anything more than 150 a day you should set yourself up as a ltd (if contracting is something your going to stick at) company, it's not so much someone getting your tax right or wrong then as you pay no income tax and corporation tax is charged at a much lower rate and you get a bill to pay as opposed to having it taken directly.

Not as much benefit being a limited company now that the dividend tax system has changed. 

[Manwell Pablo]

1 minute ago, syston_fox said:

Not as much benefit being a limited company now that the dividend tax system has changed. 

 It's still better than using an umbrella company if your committed to contracting.

[m4DD0gg]

Ltd is the way forward for contracting, so many tax loopholes to have fun with if you have the right set up and accountant.

[separator]

I was contracting through my own limited company about 16 years ago, paid hardly any tax and even got a rebate on what I paid when I dissolved the company. Loved writing myself a company cheque for the dividend payout each month. I seem to recall the IR35 tax rules was being introduced which made it less lucrative, Not been in the contracting game since so not sure how it works these days. 

[Izzy]

3 hours ago, m4DD0gg said:

Ltd is the way forward for contracting, so many tax loopholes to have fun with if you have the right set up and accountant.

My Accountant is worth his weight in gold. The best £1000 I spend every year. I pay less than 20% tax as a Ltd company although I've recently been had to transfer 12% of my shares to the wife to get around the latest dividend tax changes. No way I'd go back to paying 40% tax as an employee. Fvck that for a game of soldiers...

[m4DD0gg]

7 hours ago, Izzy Muzzett said:

My Accountant is worth his weight in gold. The best £1000 I spend every year. I pay less than 20% tax as a Ltd company although I've recently been had to transfer 12% of my shares to the wife to get around the latest dividend tax changes. No way I'd go back to paying 40% tax as an employee. Fvck that for a game of soldiers...

Exactly mate, do you 'employ' any of your family? Thats always a good one.

[SystonFox]

Leon Crnic springs to mind here

[Manwell Pablo]

On 8/20/2016 at 23:14, Izzy Muzzett said:

My Accountant is worth his weight in gold. The best £1000 I spend every year. I pay less than 20% tax as a Ltd company although I've recently been had to transfer 12% of my shares to the wife to get around the latest dividend tax changes. No way I'd go back to paying 40% tax as an employee. Fvck that for a game of soldiers...

Ah, this sounds interesting.

 

Talk to me about this.

[Izzy]

3 hours ago, Manwell Pablo said:

Ah, this sounds interesting.

 

Talk to me about this.

I'm a one man band that has a couple of my own clients but do most of my work as an Associate (can't be arsed with sales & marketing so pay a % of my daily rate to work under the banner of bigger training companies and consultancies). My business model is simple: work as few days as possible and charge as much per day as possible 

My accountant advised I went the Ltd route about 10 years ago and it's always proved the best option for me. I'm taxed on my profitability (after dividends and salary) and obviously try to claim as many of my costs/expenses back as possible. By the time my accountant has weaved his magic, my yearly corporation tax bill is between 14-18% of my total turnover. The dividend tax rules changed recently as someone mentioned, so I was advised to transfer 12% of the business shares to my wife. She gets a small monthly dividend payment each month (about £400) but I'll end up with a personal tax bill of about £1500 a year instead which I can live with. Personally for me, a Ltd company approach works best but I'm sure for many the sole trader or LLP route might be better. I used to pay 40% tax back in my corporate employment days and have many friends who work their nuts off doing 70 hours a week in the London then end up giving nearly half their salary back in tax. 

[Manwell Pablo]

55 minutes ago, Izzy Muzzett said:

I'm a one man band that has a couple of my own clients but do most of my work as an Associate (can't be arsed with sales & marketing so pay a % of my daily rate to work under the banner of bigger training companies and consultancies). My business model is simple: work as few days as possible and charge as much per day as possible 

My accountant advised I went the Ltd route about 10 years ago and it's always proved the best option for me. I'm taxed on my profitability (after dividends and salary) and obviously try to claim as many of my costs/expenses back as possible. By the time my accountant has weaved his magic, my yearly corporation tax bill is between 14-18% of my total turnover. The dividend tax rules changed recently as someone mentioned, so I was advised to transfer 12% of the business shares to my wife. She gets a small monthly dividend payment each month (about £400) but I'll end up with a personal tax bill of about £1500 a year instead which I can live with. Personally for me, a Ltd company approach works best but I'm sure for many the sole trader or LLP route might be better. I used to pay 40% tax back in my corporate employment days and have many friends who work their nuts off doing 70 hours a week in the London then end up giving nearly half their salary back in tax. 

Yeah I get all that, was specifically talking about the 12% thing. I pay the missus my share of the mortgage straight out the company anyway so I may as well get on board with this.