Super poster
£1506 per week gives me a annual gross wage of £69,000 or so (as holiday pay is included so I will assume 4 weeks holiday and 8 bank holidays) - which is well over the basic rate - we are looking at £19,000 which should be being taxed at 40% not 20%.
Now we have seen umbrellas in the past using emergency tax at 20% for a long period of time to pay an employee which may well be the case here and that didn't end up well (the person was presented with a £20k bill to pay) which is why I said the tax doesn't seem right - on my redone calculation it's £50 out rather than £100 though.
Last edited by eek; 18th November 2020 at 17:47. Reason: screwed up how holidays were being done - it's better but I'm still not sure the tax being paid is correct
merely at clientco for the entertainment
Super poster
Yep - agreed.
So the tax deduction is between £60 and £100 a week less than it might be.
That might be accounted for by expenses - but very doubtful.
There is no tax code via PAYE that gives a personal allowance and then taxes everything else at basic rate.
Something quite odd here.
Best Forum Adviser & Forum Personality of the Year 2018.
(No, me neither).
Super poster
I've previously written here about some of the bigger umbrellas to whom we sent the same data and received different "net" answers.
The creative use of expenses and application of "emergency" codes was prevalent.
Not a mention that a tax return submission would see more tax due.
Perhaps the most worrying was the NIC treatment.
There are some difficulties in working out the correct amount of employee and employer NIC where a job does not last a whole tax year. In particular giving effect to what is essentially the "nil NIC" value can be tricky.
At least three of the umbrellas we tested solved that problem by ignoring the NIC free part and applying the rates the everything.
I don't know if their subsequent returns to HMRC included the NIC free allowance (allowing them to pocket some of the NIC) or whether all the NIC was paid over.
I do know that individuals were not advised that they should check their NIC position post year end and make a claim for a refund.
Best Forum Adviser & Forum Personality of the Year 2018.
(No, me neither).
Nervous Newbie
Nervous Newbie
While the high earners - well yes, it's crap. But the low earners getting shafted by these total tossers. I have to say I get very ticked off about that.
So I propose the following tax law. Bring back the death penalty for people who promote schemes that exploit tax loopholes. Even amnesty would agree with that.
Down with racism. Long live miscegenation!