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ParasolIT take-home estimation

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    ParasolIT take-home estimation

    In my efforts to decide on how i'm going to go forward with my first contract, I obviously came across parasol. I spoke to the chap on the phone who made me the usual speech and gave me a quote.
    now, I know i am not entitled to any expenses as i live 10 mins walk from the office (besides Subsistence if I'm out of the house for over 10 hours) but when I got the quote in my mail, I see this line as a weekly claim:
    Schedule E expenses claimed: 159

    Can't really remember what that is and i'm pretty sure it wasn't mentioned to me on the phone.

    What does this mean?
    Apologies if this is an obvious, basic question - I'm still a newbie (or an amateur as mal likes to call me ) who's trying to get his head around all this.

    #2
    It could be any of these :-

    Daily Subsistence (food & drink)
    Use of Home as Office
    Travel Costs
    Mileage Allowances
    Temporary Accommodation Costs
    Personal Incidental Expenses
    Business Telephones Calls
    Sundry Costs (including Postage)
    Business Entertaining
    Eyesight Test
    Professional Subscriptions
    Professional Indemnity Insurance
    It's my opinion and I'm entitled to it. www.areyoupopular.mobi

    Comment


      #3
      Welcome to the real world (again). You are dealing with a salesman not an accountant, hence the misleading answer. If you want a straight comparison, assume the £159 expenses - is that daily, annualy, every other Thursday, or what??? - are earned income taxed at the normal rate for both PAYE and NICs (and it's too late at night for me to go dig out the numbers) and take that amount away from their bottom line.

      As you say, you ain't going to get expenses, for quite valid reasons, so you have two answers:

      Inside IR35 take 95% of your billable gross ignoring VAT and umbrella/accountants fees and pension contributions. That is your gross salary and you can compare it directly to your permie one. Except of course you need to make some allowances for health insurance, sickness insurance, critical illness cover, holidays, downtime and a few other things like PI/ELI/PLI you never even see as a permie.

      Outside IR35, take your billable gross, and assume you get to keep around 65% of it if you cross the higher level tax threshold.

      In both scenarios ignore VAT. Ignore salemen trying to sign you up to a range of schemes using false estimates. Caveat emptor. Simple, innit...

      Or take your predicted houry rate and multiply by 1000 to get a rough comparison to the equivalent permie annual salary

      Or go for PCG One-Stop (your own company) or PCG QU (umbrella option) and get honest answers, against which you can make informed comparisons.

      Or take the advice already given; for both you and the other dozen or so recent newbies, we're not trying to score points or prove how clever we are, we're trying to show you it's not black and white.

      And yes, you are a minnow in shark-infested waters. This is not a game.
      Blog? What blog...?

      Comment


        #4
        Welcome to the real world (again). You are dealing with a salesman not an accountant, hence the misleading answer. If you want a straight comparison, assume the £159 expenses

        I switched off at this point....I'm with Parasol myself and they sort out all my PAYE.

        When I get home, I want to play WOW, not ar5e around with tax forms and all that b0ll0x.

        Sure, I realise that I could save money by going Ltd.

        I also realise that I could save money by doing my own laundry and cleaning.

        I value my personal time as more valuable, so I pay an Ironing Service and a Cleaning Service to do the hassle for me.

        That's why I pay Parasol to sort out the hassle. You may say "But Geek, surely an hour a week is all it takes to get on top of your paperwork."

        However, in that hour, I can log on to World of Warcraft, make some recipes, chat with the guildies, and start an instance.

        Crikey, for those on £300+ a day, I really can't undestand why you t055 around doing Ltd, when for a fraction of that you can pay someone else to do it for you....
        Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron's cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience.

        C.S. Lewis

        Comment


          #5
          Fair enough. I never said it was a necessity, and obviously everyone can make their own decisions on where their priorities lie - that' s half the point of going contracting anyway. But my form filling consists of four VAT100s and four payslips year, 8 cheques, three signatures and the kind of record keeping I would do anyway, taking no more than 20 minutes a month, so it's hardly a major hardship. And for that trivial effort I get 15% more takehome...

          You loses your money and you takes your choice perhaps?
          Blog? What blog...?

          Comment


            #6
            Originally posted by malvolio
            Welcome to the real world (again). You are dealing with a salesman not an accountant, hence the misleading answer. If you want a straight comparison, assume the £159 expenses - is that daily, annualy, every other Thursday, or what??? - are earned income taxed at the normal rate for both PAYE and NICs (and it's too late at night for me to go dig out the numbers) and take that amount away from their bottom line.

            As you say, you ain't going to get expenses, for quite valid reasons, so you have two answers:

            Inside IR35 take 95% of your billable gross ignoring VAT and umbrella/accountants fees and pension contributions. That is your gross salary and you can compare it directly to your permie one. Except of course you need to make some allowances for health insurance, sickness insurance, critical illness cover, holidays, downtime and a few other things like PI/ELI/PLI you never even see as a permie.

            Outside IR35, take your billable gross, and assume you get to keep around 65% of it if you cross the higher level tax threshold.

            In both scenarios ignore VAT. Ignore salemen trying to sign you up to a range of schemes using false estimates. Caveat emptor. Simple, innit...

            Or take your predicted houry rate and multiply by 1000 to get a rough comparison to the equivalent permie annual salary

            Or go for PCG One-Stop (your own company) or PCG QU (umbrella option) and get honest answers, against which you can make informed comparisons.

            Or take the advice already given; for both you and the other dozen or so recent newbies, we're not trying to score points or prove how clever we are, we're trying to show you it's not black and white.

            And yes, you are a minnow in shark-infested waters. This is not a game.
            Again , I appreciate your straight forward answer and the fact you try to explain the seriousness of the going-contract decision. But at the end of the day we're all adults here who take full responsibility for their actions and just want to make a buck. as many bucks as we can for as little hassle as we can.

            In my case, I was quite happy with my permie salary but I was offered this job first as permie but they only could pay me £35 (i'm on £48.5 now) so they said come as a contractor and get £400 p/d. I like the job and more so, I like the fact that even with the most conservative calculation, I still take home some £1700 more than my current permie salary. I even looked back and counted the sickness and holiday I took in the last 4 years as a permie and it's not much. I don't care for pension as I'm not going to grow old in this country. I'm here to make as much money as I can and bugger off home.

            So I understand everything you're saying but say you were about to take you 1st contract ever, wouldn't you like to play it safe for a few months just to feel up the water? even if it does cost you some 15% a month. Peace of mind is a valuable thing, especially in shark-infested waters.

            Oh, and good morning ya all...

            Comment


              #7
              Precisely - the point was to make you sure you understand what you're doing...
              Blog? What blog...?

              Comment


                #8
                Originally posted by jor-el
                I obviously came across parasol.

                Why is it obvious ?






                (\__/)
                (>'.'<)
                ("")("") Born to Drink. Forced to Work

                Comment


                  #9
                  Originally posted by Board Game Geek
                  Crikey, for those on £300+ a day, I really can't undestand why you t055 around doing Ltd, when for a fraction of that you can pay someone else to do it for you....
                  I did my first 4-month contract with Parasol, and thought they were very good. But all things considered I'd rather have had the extra couple of thousand pounds I'd have now if I'd had a Ltd. from the start.

                  Assuming you stay outside IR35, the amount you gain in take home pay is not inconsiderable. That hour a week earns me far more than any other hour I bill my client for. And I don't believe it is an hour a week, as what I do every week now is much the same as what I did with Parasol. Maybe an hour a month is more accurate, and by quick calculation, that hour makes me 20x more than what I charge the client for an hour. Work an hour less for the client, and you'd have the same amount of time to waste on WoW and be much better off for it.
                  Will work inside IR35. Or for food.

                  Comment


                    #10
                    .. or do the hour a week in the client's time anyway!

                    That 'hour' (it's not as much as that) is worth hundreds of pounds a month in your pocket.

                    To answer your original question you can probably bank on 60-70% of your billings reaching your pocket with Parasol depending on how much Sched E you claim and whether you use their pension scheme. Parasol are a good bet when you are starting out because they are efficient and they don't tempt you into making outrageously jumped up expenses claims like some of the others.
                    Guy Fawkes - "The last man to enter Parliament with honourable intentions."

                    Comment

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