Has anyone dealt with them before? Seemingly a few of my colleagues have sacked NOVA for them but I dont qualify because I don’t gross £350 per week. PAYE may be my better option now
Given the pathetic premium rates agencies give for SE over PAYE and the fact that travel expenses, your largest expense, can no longer be legally claimed after a change in the rules by HMRC PAYE is the way to go.
We’ll work on £10/hr for Ltd, £9hr PAYE.
At £350 a week it makes no financial sense. This company want £10 a week, they’ll also deduct employers NI of roughly £22, they’ll also deduct holiday pay of roughly £40 because you’ll be paid PAYE and be due holiday pay and they’re not going to give you it out of the goodness of their heart. So that is £72 of deductions and the extra quid an hour your agency is paying won’t cover that at all, even an extra £2 won’t if you’re on £10/hr. Then after 12 weeks it gets even better because there is the workplace pension they’ll deduct 1% of your wages for to cover the employers contribution unless you opt out. £350 is already down to £288 before they start taking off employee NI and tax.
Meanwhile on PAYE the driver may be on £1/hr less so their top line is £315. They’ll take home £275.11. After they’ve been there 12 weeks they’ll get a 1% wage rise from the workplace pension so their weekly pay will effectively be £277.86. And they get holiday pay on top of that which is another £33 so although their take home pay is £275.11 their weekly wage overall is worth £308.11 in their pocket over the fullness of time once they’ve taken their holiday so they’re £30 a week up.
The amount of deductions this or any umbrella company or even if you are Ltd are going to legally be able to make is not going to be at least £150 a week which is what it would have to be to give you an additional £30 a week take home pay to put you in the same position as the person on PAYE. And even if it does, you’re no better off and will always be thinking in the back of your mind about whether HMRC are going to come knocking on your door and send you a big tax bill.
There is always the Flat VAT bandwagon you could jump on but with HMRC cracking down on mickey mouse self employment do you think that you’re safe if you do?
The safest will be those who are Ltd, do their own books, hire their own local accountant. The ones who’ll be first to be put up against the wall will be those who use the services of companies like this, NOVA etc because they make HMRC’s investigations far easier as it allows them to catch 100s or 1000s of people in a single investigation instead of 100s or 1000s of separate ones. They only need to go through say NOVAs accounts to work out how big a bill to send you.
Anderson Group:
Unprecedented changes in legislation are posing an untenable proposition for the temporary labour market, and both agency and worker need to rethink their method of working in order to remain profitable and compliant.The traditional umbrella model is likely to become defunct as contractors face losing their tax-free expenses and get squeezed at one end, while hirers try to resist rate increases to compensate at the other. Fortunately, our particular experience and understanding of the recruitment market has allowed us to anticipate the effects of new legislation and develop solutions that will enable you to continue to enjoy many of the benefits that temporary work provides.
To replace what you might recognise as a classic umbrella solution we have created the next-generation umbrella structure: Anderson Advance. It offers better returns, no risk and is highly affordable.
I’m not exactly filled with confidence. Sounds like they ■■■■■■■■ as well as the agencies their customers work for.
Last week my gross was £312 and nett was £220 which is a big wad of cash to lose every week. PAYE rate is just over £2 an hour less on Saturday and £3 less on Sundays. Number crunching came out with me paying £30 per week on PAYE instead of around £90. This was worked out on Xmas rates and my job changing to 2 x 14 hour shifts with a night out. After Xmas this will go back to 10 - 15 hour shifts on Saturday and Sunday with hopefully every 2nd tuesday
scanny77:
Last week my gross was £312 and nett was £220 which is a big wad of cash to lose every week.
Your deductions for £312 should be £38.93, £20.09 tax and £18.84 NI, for a take home pay of £273.07 on PAYE.
PAYE rate is just over £2 an hour less on Saturday and £3 less on Sundays.
I bet when you factor in the 12.7% additional pay which is holiday pay and the 11% employers NI you don’t have to pay that the difference is basically zero other than the fees from the umbrella/Ltd Co accounting. Was any of that £90 deduction holiday pay which you’ll later get back? When I see S/E rates like that above PAYE it suggests that the agency have taken into account holiday pay and employers NI to ensure that your net pay is the same as it would be on PAYE so they’re not doing it for their own gain as the “extra quid an hour” mob do.
Its NOVA who said £10 is tax but its NI that is taking a big chunk because I am paying employers and employees NI. On 2 shifts a week it is probably not worth it any more. PAYE is probably the best way to go now and I can forget all the IR35 and HMRC stuff
Going ltd fully would have nowhere near the level of deductions conor says. He shouldn’t have any NI to pay as he should be claiming low earnings exemption
It was an accountant that advised me to go PAYE with my circumstances. I have 1 week left as I am then I can pick up ad hoc Tuesday shifts but I would prefer having every other Tuesday off. Since August I have been travelling through to Livingston 7 days a week apart from 1 week in October when I had 3 days off. Its probably not worth going ltd co for 5 shifts a fortnight