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IR35 post April 2020: Choosing a legitimate Umbrella

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    #51
    My consultancy is recommending that its contractors be prepared to join an umbrella after April. Here are the choices -

    1. Brookson Umbrella
    2. Danbro Umbrella
    3. Giant Umbrella
    4. Parasol Umbrella

    I've only looked at Giant so far and their nett pay calculator looks suspiciously inflated. They are also stating that there is no SDC involved, which I guess is their way of saying the engagement will not be one of employment. So which would the panel recommend and what should we look out for?

    The consultancy is also stating that the review by QDOS will not result in an SDS, but that's exactly what the review is. Looks like they are all behaving like a bag full of monkeys!

    Comment


      #52
      Standard list that's been around since the public sector changes.

      Do a search using the Google method to go find the feedback rather than go over it again and take this thread offtopic.. Or as we call it, doing a JtB.
      'CUK forum personality of 2011 - Winner - Yes really!!!!

      Comment


        #53
        Originally posted by nucastle View Post
        You don't need insurance for yourself if you are using an umbrella. The umbrella has insurance which the agent will want to see sight of.

        The only thing you need to do when using an umbrella is just to turn up for work, do your time sheets and then get paid and receive your pay slip.
        Still, remember insurance has a limit to how much of your unlimited liability it can cover. A limited liability company actually limits liability.

        Significant difference.

        Comment


          #54
          Originally posted by vlc View Post
          Still, remember insurance has a limit to how much of your unlimited liability it can cover. A limited liability company actually limits liability.

          Significant difference.
          but as I pointed out to a large (panicking) multinational yesterday any inside IR35 is an employee and their employer is the person responsible for the work and insurance.

          that limited liability and professional indemnity (except for gross misconduct) still exists it’s just higher up the chain and not the concern of the employee now inside IR35.
          merely at clientco for the entertainment

          Comment


            #55
            Read the contract before you sign!!

            Because dodgy umbrellas will do everything they can to hide the truth from you, as one poor soul explains...

            Originally posted by One Poor Soul
            This email was sent to me by the contract manager from Umbrella company before I was sent the contracts to sign. I don't know if there any any implications here but there is no mention of loan payments here. The contract itself which is 24 pages long mentions the loan part on page 19 in a small section.

            "In terms of how this is calculated, there are 2 elements that the contractor can benefit from:



            1. A salary portion (NMW) which is where the PAYE & NI are deducted.

            2. The option as an employee to apply for a tax free element from his employer at a commercial rate of interest (a traditional Umbrella company will describe the difference as expenses and commission where as a Ltd Company will use a dividend option which attracts corporation tax)



            The 2nd portion is a payment which is treated differently under the BIK rules and accordingly is not classed as employment income or revenue and is therefore accounted for in a different way.




            We take care of tax, NI, P45 etc as the employer.



            Benefits include:

            • Fully employed status

            • Fully compliant

            · Same day payments

            • £10 million Employers Liability Insurance

            • £5 million Public & Products Liability Insurance

            • £2 million Professional indemnity Insurance

            • No expenses to collate and submit, Not expense dependant

            • No tedious admin

            • Outside IR35

            • Outside MSC

            • Dedicated account manager

            • No fees when not working

            • Immediate payment weekly or monthly – depending on agency/end client instructions



            We manage your tax and NI so you wouldn't need to worry about that and we will send you a payslip on a weekly basis which covers your salary amount for the period worked."
            "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
            - Voltaire/Benjamin Franklin/Anne Frank...

            Comment


              #56
              Originally posted by cojak View Post
              Because dodgy umbrellas will do everything they can to hide the truth from you, as one poor soul explains...
              Let's be 100% clear here.

              He should have looked at bullet 1 and started to get ready to run and by the end of the 2nd bullet point should have been sprinting as fast as possible towards a different firm..

              Post April* an umbrella company can only send money in 1 of three directions:-

              1) To HMRC in tax
              2) To your personal bank account (after tax has been paid)
              3) To your pension fund via Salary Sacrifice.

              They will also deduct a small fee for their services (yes, I know but hey they have to make some money for the work they do if the agency isn't paying the fee).

              If the money is not going to one of those 3 places be very careful....

              *It's slightly different prior to April 2020 as expenses are still available in some circumstances - as the umbrella company how they work and if you don't understand post what the umbrella says here and people will check what they say...
              merely at clientco for the entertainment

              Comment


                #57
                Yes I quite agree eek.

                But how many do actually read all 24 pages of the contract before signing it, unless they are poked first?

                (Apart from CUK regulars, obv…)
                "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
                - Voltaire/Benjamin Franklin/Anne Frank...

                Comment


                  #58
                  Originally posted by cojak View Post
                  Yes I quite agree eek.

                  But how many do actually read all 24 pages of the contract before signing it, unless they are poked first?

                  (Apart from CUK regulars, obv…)
                  The actual relevant bit is

                  A salary portion
                  Once they talk about dicing your money around it's no longer yours..
                  merely at clientco for the entertainment

                  Comment


                    #59
                    So, when you get your contract, make sure that you get a softcopy of it and do the following:
                    • Search for the following terms: 'loan', 'salary portion', 'partial', 'split', 'divide', 'share', 'payment on account', 'taxable discretionary bonus’. Found nothing? Then
                    • Read it from the beginning to end, then
                    • Read it from the end to the beginning, page by page; dodgy gits will try and hide anything at the back.


                    If you do find any of the above references, run away. If you still can't find anything then it's probably ok.

                    Edit: NMW is ok - see Zeeshan's post below.
                    "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
                    - Voltaire/Benjamin Franklin/Anne Frank...

                    Comment


                      #60
                      Originally posted by cojak View Post
                      So, when you get your contract, make sure that you get a softcopy of it and do the following:
                      • Search for the following terms: 'loan', 'salary portion', 'NMW', 'partial', 'split', 'divide', 'share', 'payment on account'. Found nothing? Then
                      • Read it from the beginning to end, then
                      • Read it from the end to the beginning, page by page; dodgy gits will try and hide anything at the back.


                      If you still can't find anything then it's probably ok.
                      Hi cojak,

                      Most compliant umbrellas use 'NMW and profit share/bonus' type wording in the employment contracts, so some of your terms may come up.


                      Thanks

                      Zeeshan
                      Dolan Accountancy

                      Contractor Umbrella

                      01442 795 100

                      Comment

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