andyofborg Posted September 4, 2012 Share Posted September 4, 2012 this is not correct as i have a friend who is doing the same. he is not classed as an employee by the agency (but going on the tax office employment status indicator test he is ) he pays no national insurance through the agency either he just pays tax .he can also claim for his phone/petrol/buying tools etc. this is a very grey area and the onus is on you to make sure everything is above board. whether or not the agency class him as an employee or not is immaterial, it's what the hmrc class him as which is important. if he is paying tax through the agency then he should be paying ni through them too. if he isn't paying the class 1 ni then he won't be eligible for a whole host of benefits. the alternative is class 2/4 ni contributions which only establish an entitlement to the state pension and a few non-contribution based benefits. if he's not paying any ni, then when taxman catches up with him he's going to get a big fine Link to comment Share on other sites More sharing options...
neeeeeeeeeek Posted September 4, 2012 Share Posted September 4, 2012 So you are saying that if I got £15 per hour PAYE, I should expect 30 per hour as a contractor? Different kettle of fish. If you have a full time job with a company and are earning £15 an hour, they might have to pay £30 an hour to get a skilled contractor in for a couple of weeks. If you are looking for contract work, and they offer you say 2 weeks work, they might give you the choice of working PAYE at £15 or £17 limited / umbrella. They certainly wont pay you double! Link to comment Share on other sites More sharing options...
taxman Posted September 4, 2012 Share Posted September 4, 2012 if he's not paying any ni, then when taxman catches up with him he's going to get a big fine If HMRC decide that the relationship was one of employment rather than self-employment they will pursue the employer for any shortfall in PAYE tax or National Insurance contributions (Employee and Employer) as it is the employer's responsibility to make the correct deductions and pay them over. Link to comment Share on other sites More sharing options...
ricgem2002 Posted September 4, 2012 Share Posted September 4, 2012 whether or not the agency class him as an employee or not is immaterial, it's what the hmrc class him as which is important. if he is paying tax through the agency then he should be paying ni through them too. if he isn't paying the class 1 ni then he won't be eligible for a whole host of benefits. the alternative is class 2/4 ni contributions which only establish an entitlement to the state pension and a few non-contribution based benefits. if he's not paying any ni, then when taxman catches up with him he's going to get a big fine he is not paying ni the agency is classing him as self employed. i know its what hmrc class him as that counts, but he is not paye and therefore not an employee. Link to comment Share on other sites More sharing options...
AWOL Posted September 4, 2012 Author Share Posted September 4, 2012 The situation is that I have had an employment agency contact me asking if I shall work for a company who I will not be employed by. They have asked me to use the services of an "Umbrella company" . The way that I see it is that as a PAYE person I only have one lot of parasites to pay (the employer), but now I have 3. Link to comment Share on other sites More sharing options...
denlin Posted September 4, 2012 Share Posted September 4, 2012 The situation is that I have had an employment agency contact me asking if I shall work for a company who I will not be employed by. They have asked me to use the services of an "Umbrella company" . The way that I see it is that as a PAYE person I only have one lot of parasites to pay (the employer), but now I have 3. Don't give them thy bank details, they might be money launderers, another wind up:hihi::hihi: Link to comment Share on other sites More sharing options...
taxman Posted September 4, 2012 Share Posted September 4, 2012 The situation is that I have had an employment agency contact me asking if I shall work for a company who I will not be employed by. They have asked me to use the services of an "Umbrella company" . The way that I see it is that as a PAYE person I only have one lot of parasites to pay (the employer), but now I have 3. I feel for you, really. I used to be involved with the IR35 team in Sheffield and I'm glad to be the hell out. I still do deal with status though, which is still a grey area. There are also specific agency regulations, rules about specific occupations and there is a gangmaster team which also deals with agencies. I can offer no help apart from seek the advice of an honest accountant/agent. Link to comment Share on other sites More sharing options...
ricgem2002 Posted September 4, 2012 Share Posted September 4, 2012 I feel for you, really. I used to be involved with the IR35 team in Sheffield and I'm glad to be the hell out. I still do deal with status though, which is still a grey area. There are also specific agency regulations, rules about specific occupations and there is a gangmaster team which also deals with agencies. I can offer no help apart from seek the advice of an honest accountant/agent. well said taxman Link to comment Share on other sites More sharing options...
AWOL Posted September 4, 2012 Author Share Posted September 4, 2012 I feel for you, really. I used to be involved with the IR35 team in Sheffield and I'm glad to be the hell out. I still do deal with status though, which is still a grey area. There are also specific agency regulations, rules about specific occupations and there is a gangmaster team which also deals with agencies. I can offer no help apart from seek the advice of an honest accountant/agent. I have about as much chance of finding an honest accountant as I have of finding an honest politician. Link to comment Share on other sites More sharing options...
neeeeeeeeeek Posted September 4, 2012 Share Posted September 4, 2012 The situation is that I have had an employment agency contact me asking if I shall work for a company who I will not be employed by. They have asked me to use the services of an "Umbrella company" . The way that I see it is that as a PAYE person I only have one lot of parasites to pay (the employer), but now I have 3. The company are using an agency so they don't have to employ you. No holiday pay, sick pay, notice period, employee number, no paying you to do nothing when it's quiet, no nothing! You are not loosing out if they pay the agency is offering is acceptable to you. Sometimes you can negotiate a better rate, but unless they really want you, they can usually fill the roles. I turned down various bit of work with Hayes, £17.50 an hour sounded OK until I found out it was a night shift in Halifax! There are other examples where I didn't think it was worth my while and not once did they say OK, we will pay you a bit more. The days of earning serious cash contracting are over, unless you have some very good skills. Link to comment Share on other sites More sharing options...
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