The following links give the downside of umbrella schemes…
http://www.litrg.org.uk/News/2012/umbrella-schemes-etc-the-risks-to-the-low-paid-worker
These are quite disturbing articles. The agency I do some work for at the moment does the salary sacrifice thing and makes my wage up with expenses. That’s the reason I’m asking you guys about these things. The old saying bout if it doesn’t feel right then it probably isn’t. This is all new to me as I never came across them before and I just want to get back driving again and making a decent living doing a good days work without someone trying to screw me over. That’s why I’m looking at going Ltd but not sure if it’s worth all the red tape…I’m in a quandary bout all this.
I had the same problem as you 9 months ago. The first thing I did was ask about for a reliable accountant. I arranged an interview with an accountant. The accountant explained everything to me and set it all up. All I do is keep receipts and do a weekly spreadsheet and invoice.
If I have any queations I email the accountant.
EddieMD:
That’s why I’m looking at going Ltd but not sure if it’s worth all the red tape…I’m in a quandary bout all this.
It isn’t worth it, as you say … If it sounds too good it probably isn’t
You need to be pretty confident about what you are doing
So in able to work and stay away from umbrellas I would really need to go down the route of becoming self employed and doing my own paperwork and use accountants? No wonder with that and the CPC there’s a shortage of drivers.
what kind of ramifications do you guys see with using these umbrellas with regards to HMRC and the likes of an individual like myself or others. I font want to end up with a huge tax bill or getting into trouble. Also read one of the links earlier saying the whole practice is being looked at.
Just asking for your opinions and thoughts guys…and help…haha!
EddieMD:
So in able to work and stay away from umbrellas I would really need to go down the route of becoming self employed and doing my own paperwork and use accountants? No wonder with that and the CPC there’s a shortage of drivers.
what kind of ramifications do you guys see with using these umbrellas with regards to HMRC and the likes of an individual like myself or others. I font want to end up with a huge tax bill or getting into trouble. Also read one of the links earlier saying the whole practice is being looked at.
Just asking for your opinions and thoughts guys…and help…haha!
You may get the odd person on here who makes out they are ‘one of the lads’, but actually works as a recruitment consultant, telling you umbrella schemes are the best thing sliced bread and how you’ll benefit from this and that. You will also get drivers on here that have yet to be investigated (and billed) by HMRC saying how good they are. If you get independent advice on them though, or do your own research on the net (not through a forum) you will quickly find why HMRC is cracking down on them and why they will be knocking on people’s doors and getting the money that is owed to them. If an agency won’t offer you straightforward PAYE, then walk away and go to one that will.
I’m looking for as much info about them as I can get from guys…and girls who have some experience with them. I’m very wart and that’s why I’m asking you. Liberty_Guy, that’s very much along my thoughts and I will definitely be following your advice pretty much to the letter, but I still want to know the general thoughts, opinions and experiences from these companies. It’s maybe just the shop steward in me that want to know all the facts and angles…ha!
EddieMD:
I’m looking for as much info about them as I can get from guys…and girls who have some experience with them. I’m very wart and that’s why I’m asking you. Liberty_Guy, that’s very much along my thoughts and I will definitely be following your advice pretty much to the letter, but I still want to know the general thoughts, opinions and experiences from these companies. It’s maybe just the shop steward in me that want to know all the facts and angles…ha!
The hirer (client) won’t give a monkeys chuff if you get into problems with the taxman, drivers are just casual muppets that drive their trucks when they have a need. The agency certainly won’t give a ■■■■ either, if they did they wouldn’t have anything to do with umbrella schemes now HMRC have made their position clear. Final point (and the most obvious) if the ‘umbrella company’ itself doesn’t actually pay your tax and insurance onto the people they are supposed to, you will have zero contributions for that period which will affect both your pension rights and your right to claim many benefits, including jobseekers allowance if things go quiet.
We all have to make our own choices though.
A god point about things actually being paid. My old man worked for a company years ago driving when the company went bust. Turned out they weren’t paying taxes or NI. He got hit with bills left and right. He managed to fight it with the simple fact that my mother had kept every payslip stating that the employer had payed all these. I learned from that and have kept my own dating back years. Any online accounts I have I keep a hard copy as well.
I’m under no illusion these guys will sell you out for a proverbial buck. Agency already wants me doing stupid hours and I sometimes have to wonder if they actually know anything bout drivers hours.
The reason agencies started refusing to use sole trader self employed drivers was because over time many who professed to be self employed, never paid their due income tax or NI. HMRC then came onto the agencies to pay it. So they had to pay it twice having already paid the driver gross. As usual, the drivers were there own worst enemy, the minority creating the situation that now inconveniences many genuine and honest people.
So how about now? I’ve worked this same agency for a couple months now. Hours suit and contracts are ok to work for. Found out last week that for one of the contracts…A good payer…The hourly rate was being cut. Not by just a couple of pennies either. I had to hear this from another driver as well. He also said that he mentioned parity to the agency and was told that it didn’t apply as we were self employed. We go through an umbrella company who they set us up with. Also on my wage slip my tax clearly says PAYE. I need to read up on HMRC and self employed and the likes. I’m trying to get back to driving to get away from as much of this rubbish as I can, not look for more!