Brolly clients - free check on salary/deductions

[Debbie ITAccounting Online]

Re: Payslips

Rooney - it's specific to one umbrella company but obviously I cannot name them here. If you call me or email me we can discuss.

Simon, we wouldn't deduct employers NI from post tax salary but we have become aware that another umbrella company is doing so.

[Debbie ITAccounting Online]

Re: Payslips

Freshblue

The salary does relate to the contract income coming in but if the calculations are not done correctly then the Inland Revenue benefits and the contractor suffers!!

[ajh]

Re: Payslips

Hi Debbie,

Is it Parasol ?

[Debbie ITAccounting Online]

Re: Payslips

ajh

Have responded to your email.

[rooney]

Payslips

Debbie

If you have found a company that is incorrectly deducting NI then I think it should be public knowledge. Why the secrecy? If you are confident that you are correct and they are wrong (i.e. what you are telling us is factually correct and not libel/slander) there will be no comeback on you.
At the least you should give us details of the problem (i.e. an example) so we can all understand and check our payslips.

I am a little confused as well (although my accounting/payroll knowledge is extremely limited) but if employers NI is being deducting from post tax salary then surely the NI would be less than it should be and not more as you stated.

Y

[freshblue]

Re: Payslips

Something smells dodgy here, hope this is not a way to drum up business Debbie!

[Debbie ITAccounting Online]

Re: Payslips

Example (ignoring brolly admin fees):

Calculated incorrectly
Contact income £1000.
Schedule E expenses £200
Gross Salary £800 (£1000 - £200)
Employers NIC on £800 = £83.90
Employees NIC on £800 = £49.60
Tax on £800 = £176.46
Amount payable to IR = 83.90 + 49.60 + 176.46 = £309.96.
Net salary to contractor £800 - 49.60 - 176.46, should be £573.94 plus £200 expenses due to contractor, total of £773.94
But From contract income of £1000, £309.96 goes to IR, leaving £690.04 for contractor, he is out of pocket by £83.90 (Employers NIC amount).

Calculated correctly :
Contract Income £1000 less expenses £200, £800 available.
Employers NIC £75.04
Contractors Gross Salary £724.96 (Salary + Employers NIC = £800, the amount available.
Employees NIC £49.60
Tax on £724.96 £146.46
Amount payable to IR = 75.04 + 49.60 + 146.46 = £271.10
Net salary to contractor £724.96 - 49.6 -146.46 = £528.90 plus £200 expenses due to contractor, total of £728.90
From contract income of £1000, £271.10 goes to IR leaving £728.90. for contractor.

Okay in this example it is only £38.86 difference to the amount that ends up in the contractor's pocket, but wouldn't you rather it was in your pocket than in the Inland Revenues?

[Debbie ITAccounting Online]

Re: Payslips

Freshblue

If your with an umbrella company and they are making the calculations correctly you have nothing to worry about.

Suggest you ask VurtGameCat.

[VurtGameCat]

Re: Payslips

Hey,

My Brolly currently does this,

I don't want to name any names because they pay me my wage and i don't want to ruffle any feathers.

I will send a mail to my brolly now to see how they explain this.

GC.

[rooney]

Re: Payslips

Why should we ask VurtGameCat when you know who it is!!!!

How about we play a game and say who it is not....

FileTravel
Contractors Manager
Orange Genie
Prosperity 4
Parasol IT
ContractorUmbrella
Contranet
Drole
Giant
JSA
etc...