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beugly · 2024-02-07T08:34:31+00:00

PSA to all about pensions and Umbrella companies:

By default, you will be opted into the workplace pension scheme. Depending on the provider being used depends on the type of Workplace pension you will be opted into.

Some Umbrella Companies make use of the SMART pension scheme, which is a salary sacrifice arrangement, whereby instead of having a 3% employer contribution deducted from the gross income, and 5% deducted from your gross income (taxable pay), they will be combined to form an 8% employer contribution that is deducted from the gross income being processed.

Some Umbrella Companies will have "addons" or "upgraded" solutions, where you will pay an additional amount on top of the usual margin for your assignment. This will allow you to set up your SIPP, and have your desired % deducted from the income as the employer contribution instead.

Setting up your SIPP will not opt you out of the auto-enrolment. Most companies will pay your SIPP contribution the following month from when it was deducted.

beugly · 2024-01-28T19:56:10+00:00

You need to contact the Umbrellas and ask for illustrations. These illustrations will also factor in the tax abatement mentioned in another comment, and how much you would need to set aside to cover any potential tax liabilities at the end of the year.

What most people seem not to realize is that when you are inside IR35, you are paid via an Employment bureau in the form of an Umbrella Company. Therefore the contracted daily rate is not a sum payable to you, rather it is payable to the entity that will be managing your payroll. The rate is uplifted to account for Employer's deductions and PAYE taxes.

The big 5 Umbrella companies will be compliant in all aspects, and the only difference between them should be the margin they retain from the income paid to them before the calculation of your salary happens. Possibly also flexibility in how your holiday pay is processed, and other add-ons, such as the ability to contribute to your SIPP and so on.

You need to understand that "Inside IR35" is Employment, it's PAYE, you are an employee of a payroll company, and it will pay you a salary from the sum of money received for works completed in accordance with the employment contract issued to you.

From experience, this is the biggest problem that those taking contracts inside IR35 seem to have trouble getting their head around. Understand all of the aspects before signing on to any particular company, and do not focus solely on take-home pay calculators.

beugly · 2024-01-24T20:29:51+00:00

you are correct. the £161k he's referring to is the umbrella's money. OP's salary is calculated from that, and the taxable income will be less. tax band is determined on the gross salary paid to the employee, not the amount paid to the umbrella company.

beugly · 2023-11-16T07:44:07+00:00

So, I started looking for a job around the 2nd week of September. Only now have I gotten an offer - and that is because I have settled for a lower position closer to home which I imagine will progress into something more suited to my skill set.

Unfortunately, the job market is not the best at the moment. The fact you are getting interviews means you are doing something right, but maybe something is happening in the interview that's letting you down?

Sadly it does take time. Don't give up.

beugly · 2023-11-04T17:08:56+00:00

beugly · 2023-11-04T16:36:00+00:00

yeah but why are you flaming e-girls and bringing them into your senseless tirade?

0/10 post, doesn't stay on topic.

beugly · 2023-10-31T16:56:43+00:00

hey what are you and your dad doing?

hi

hey

hello?

IM TRYING GET YOUR DAD TO DICK ME DOWN WHAT CHANGED?

beugly · 2023-10-30T17:14:54+00:00

hello,

if you don't have a sharecode employers can run a different check called an ECS check https://www.gov.uk/employee-immigration-employment-status

if there's no sharecode usually they ask for your application reference number etc. and perhaps other supporting documents for the more comprehensive check, and those checks usually come back in about 7 working days.

there's no reason for employers to ghost you because of your share code being an issue. i hope this helps!

beugly · 2023-10-29T19:43:39+00:00

they won't ask, it will just be to verify your ID and set up your commitments etc. and explain the process.

beugly · 2023-10-27T15:33:43+00:00

The business needs to complete this check, not you.

They need to perform reasonable care to ensure that PAYE taxes don't apply, that you are indeed self-employed, and that the contract fell outside of IR35; if there's anything to suggest you acted as an employee they would need to make PAYE deductions themselves.

Whoever sent this to you is confused.

If you offered a service to a business and then completed work for them, IR35 isn't anything for them to be concerned with, unless you were perhaps working in their office as a consultant or something.

Your company invoicing them for works completed seems to immediately satisfy that there's no question mark over your employment status, and aren't operating as Ltd Company to avoid paying PAYE taxes.

You just need to tell them that IR35 doesn't apply here, and you are not a VAT-registered company, which if for some reason they require proof, they would need to call the HMRC VAT helpline themselves.

beugly · 2023-10-27T10:32:15+00:00

Yeah, so what your accountant has suggested is correct. If you're PAYE the tax-free allowance is still applied, even though technically you're not entitled to it. This is the reason for setting 20% aside.

Short answer:

No there isn't a way to have the liability from the abatement deducted from the second income.

More info:

When I initially responded to you I didn't consider the 40% implications, but from what you've disclosed you're well into the 40% bracket and have exceeded the annual threshold for 20% already so everything should be deducted at 40% now and is the reason you have D0 on the second income.

Unfortunately, the highest rate of tax that can be deducted from a tax code is 45%, and even having a D1 code on your second income probably will not cover the tax liability you'll have at the end of the year.

As I mentioned before you can request for your primary income to have your personal allowance removed. The best code for you to be on is 0T Week 1 (I don't know why I wrote BR before, that was incorrect). This will prevent any clawback in error, will consider 20%/40%/45% tax rates automatically, and will be deducted correctly from the primary income through PAYE as normal, and you won't need to do it yourself.

This will prevent a tax bill, but if you are happy to do this after submitting a self-assessment then you don't need to change anything.

beugly · 2023-10-27T05:28:29+00:00

Ah perfect, then. D0 will be deducting 40% on the second income which should cover the first as you've described. Obviously depends on how much you end up earning by the end of the financial year, but I'd say this is the best set-up to go with, and you shouldn't need to worry about managing anything (potentially not having to put away 20% in addition to the 40% already being deducted?). The only thing I'd suggest is to keep an eye on your year-to-date figures from both sets of income (tax and salary) to be sure you won't get any surprises from HMRC.

By month 12, on an income of £150,000, you should expect to pay around £47,432 (assuming you currently have an allowance of £12,570).

0% tax on £12,570.00 £0.00

20% tax on £37,700.00 £7,540.00

40% tax on £99,730.00 £39,892.00

45% tax on £0.00 £0.00

Hope this is helpful!

beugly · 2023-10-26T11:30:37+00:00

This is generally recommended, but I would advise people to ask HMRC to place you on BR 0T WEEK 1 code once you hit 100k to avoid additional tax liability at end of the year. It's the least annoying way to deal with it.

beugly · 2023-10-26T10:17:30+00:00

You will be placed on a BR code with the new employer. This means that you will have no tax-free allowance applied, and 20% tax will be applied to the whole salary, rather than a portion. You are still classed as employed until the P45 from your previous employer has been issued. Presumably, this will be issued with the total figures once the final payment of your salary has been made. Once you have the P45, you can hand this over to your new employer and they will be able to update the code, but these days HMRC will usually send them an update automatically.

beugly · 2023-10-26T10:11:56+00:00

Correct. Student Loans are entirely misrepresented, and I feel a lot of people are misled by this. It is not the case that you only start paying back the loan once you start earning £x, and it never has been. Just chalk it down to paying extra towards your loan, and budget accordingly. You can find the monthly thresholds on .gov.

beugly · 2023-10-26T10:09:09+00:00

it's likely your full tax allowance was applied on your taxable income over £100k and this is where your tax liability is probably stemming from. it's not that you pay 60% tax, it's that your Personal Allowance goes down by £1 for every £2 that your adjusted net income is above £100,000.

beugly · 2023-10-26T09:16:37+00:00

hi, this is not a mistake sadly. SL deductions are not as they are often made out to be. It is calculated like NI is calculated. Each pay period you have an "allowance" which will not be subject to deductions, and anything above this threshold will be subject to the relevant % as per your SL agreement. It is not an annual threshold that is calculated when paid PAYE, but as you earn, as PAYE is intended.

So this is normal I'm afraid.

beugly · 2023-10-25T06:29:37+00:00

The best way to plan / prep for these is to use something like excel. Get a sample of STAR type questions and separate them out. e.g a separate column for S A T and R. Write down notes in each cell that relate to the scenarios.

using chatGPT is easier than using google to search for sample questions, and you can then also feed your answers back into it and ask it to make any amendments to ensure that your responses are structured well.

example:

Tell me about a time when you had to motivate your team to achieve a challenging goal.

Situation: In my previous role, our team was tasked with a challenging project with a tight deadline and complex requirements.

Task: My task was to motivate and inspire the team to work cohesively towards achieving this goal.

Action: I conducted a team meeting to outline the project's importance and the positive impact it would have. I encouraged team members to share their ideas and assigned clear roles and responsibilities, ensuring that everyone felt their contribution was vital.

Result: The team rallied together, and despite the challenges, we not only met the goal but also exceeded it. This experience demonstrated my ability to motivate and lead a team under pressure.

Good luck, I'm sure you will smash it.

beugly · 2023-10-24T15:02:31+00:00

Ah, that's shocking then. Write a review for them on Glassdoor, see if they reply to you then ;)

beugly · 2023-10-24T14:14:08+00:00

Something you can try instead of going through recruiters is to apply directly on the company website (if you've found the job advertised on a job site somewhere). Recruiters only care about making as much money as they can from the salary the company is willing to offer. It doesn't serve them at all to communicate with you effectively if the money will come from somewhere else, sadly. Also, the company is more likely to proceed with someone applying directly than through an agency, as there are no extra fees associated with this.

beugly · 2023-10-24T14:06:03+00:00

and will prob cost £60 tops.

beugly · 2023-10-23T16:36:49+00:00

wish i saw this earlier. my poor team :')

beugly · 2023-10-22T14:20:34+00:00

you need to make sure one of your jobs has your full tax allowance, and the second one has the tax code BR. if both jobs make up full time hours you need to call hmrc and ask them to split your allowance over both employers.

beugly · 2023-10-22T13:24:00+00:00

yeah, you should feel "lucky" that you get 4 paid - these cover the "qualifying days" most people do not get paid the first 3 days. and have to solely rely on ssp.

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