employers NI - weekly or annually? employers NI - weekly or annually?
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  1. #1

    Nervous Newbie


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    Default employers NI - weekly or annually?

    Hello all.
    I started a contract just before the end of the tax year, and my earnings for 2018/19 were around £5.5k.
    From this, the umbrella company have taken a total of £666 in "Employer Statutory Costs" i.e. employers NI.
    A bit of research done on the internet suggests that I should have not paid employers NI because it's under the threshold (I can't find the exact figures but it's around £7-£8k per year).
    The umbrella company are telling me that employers NI is calculated on a WEEKLY basis, so they won't help me with a refund.
    Who is correct? And why?
    Thanks in advance.

  2. #2

    TykeLike

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    Quote Originally Posted by CubeWizard View Post
    Hello all.
    I started a contract just before the end of the tax year, and my earnings for 2018/19 were around £5.5k.
    From this, the umbrella company have taken a total of £666 in "Employer Statutory Costs" i.e. employers NI.
    A bit of research done on the internet suggests that I should have not paid employers NI because it's under the threshold (I can't find the exact figures but it's around £7-£8k per year).
    The umbrella company are telling me that employers NI is calculated on a WEEKLY basis, so they won't help me with a refund.
    Who is correct? And why?
    Thanks in advance.
    I believe only directors have the ability to calculate NI annually, and you would not be a director of the umbrella company
    “Live a good life. If there are gods and they are just, then they will not care how devout you have been, but will welcome you based on the virtues you have lived by. If there are gods, but unjust, then you should not want to worship them. If there are no gods, then you will be gone, but will have lived a noble life that will live on in the memories of your loved ones.”

    ― Marcus Aurelius

  3. #3

    Still gathering requirements...


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    NI is usually weekly so they are right.

    Only tax is cumulative, NI, student loan etc are for the period they are in.

  4. #4

    More time posting than coding


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    Quote Originally Posted by RyanDS View Post
    NI is usually weekly so they are right.

    Only tax is cumulative, NI, student loan etc are for the period they are in.


    Which is one of the reasons why Inside IR35 taxes are unfair on contractors. You could be on the bench for 3 months and you’ll have paid more NI in the 9 months you had work than you would have done for the same invoice amount spread over the year.

    Yes it’s the same for employees but they’re far less likely to be stuck on the bench

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