Umbrella co. nett pay or gross pay?

[SPURSN17]

im confused as to how my pay is calculated by my umbrella company.

i was prevously on a contract which paid 12ph 37.5 hours and i recived 440 a week after tax through an umbrella company with 300 a week expenses.

im now on a another contract 11 ph 37 hours and i am paid 330.00 a week.

with 250.00 expenses weekly.

gross pay £407.00 nett pay £468.05

is tax taken off gross pay or nett pay??

[Alan @ BroomeAffinity]

How can you possibly have £250 expenses on £407 gross. That means you earn less than £150 per week for 37 hours. I'd be more concerned about your questionable expenses than anything else.

[SPURSN17]

sorry the 407 was aswell as my expenses the expesnes are high as the job is 40 miles away from me

[northernladuk]

You pay tax on your profits only. It would be a tad unfair if you had to pay taxes on your outgoings as well!

[ilovehr]

???

So, are you actually claiming £250 per week in business expenses or are some of them actually reimbursed to you gross?

To check the calculation I need to know exactly how much you are claiming in business expenses from the umbrella - are you by any chance claiming up to their dispensation amount each day. mad

From the information you've given us it appears that you are claiming:

80 miles per day at 40p per mile = £160
£18 per day subsistence = £90
Total = £250

If this is the case, this far exceeds the maximum expenses you could claim for the umbrella to be able to pay you National Minimum Wage!

Interesting......

[Svalbaard]

Would agree that for such a simple job as it is to calculate payroll, the differences I have noticed between similar Umbrella companies is marked.

Have been with 3 Umbrellas now over the space of 6 years, and CU do seem to get it right and I have had no major reason to question their figures - unlike the other two where it seemed I was always on the phone to them to get answers.

[malvolio]

Don't really want to get involved, but the numbers quoted by the OP make little sense to me, so someone somewhere is telling porkies.

As for umbrella tax calculations, they tell you different things but all apply the same basic principle: take your earned gross, deduct allowable expenses and their fees, deduct PAYE/EENICs on the balance and you get the net pay. They cover the Employer's NICs by having a balancing uplift on the rate charged to the agency. The only variations in net pay are from variances in fee rates and any interesting interpretations of expense allowances. Some also quote fees gross and others net, so even that is not directly comparable.

[SPURSN17]

thanks for the reply. i was happy with Cyrstal Umbrella but this approved list carry on with my agency has forced me to change. considering going limited as have been contracting with umbrella companies for over three years now so feel i would be better off????

[SPURSN17]

So, are you actually claiming £250 per week in business expenses or are some of them actually reimbursed to you gross?

To check the calculation I need to know exactly how much you are claiming in business expenses from the umbrella - are you by any chance claiming up to their dispensation amount each day. mad

From the information you've given us it appears that you are claiming:

80 miles per day at 40p per mile = £160
£18 per day subsistence = £90
Total = £250

If this is the case, this far exceeds the maximum expenses you could claim for the umbrella to be able to pay you National Minimum Wage!

Interesting......

yeah this is what i am claiming as i am travelling quite a distance..could this make me worse off claiming this amount???

[malvolio]

thanks for the reply. i was happy with Cyrstal Umbrella but this approved list carry on with my agency has forced me to change. considering going limited as have been contracting with umbrella companies for over three years now so feel i would be better off????

HAve a read of this - <snip>