am i self employed or employed ?? am i self employed or employed ??
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  1. #1

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    Default am i self employed or employed ??

    as i am working under an umbrella company i thought i was employed . is this right ?? i dont need to do any tax returns etc ???

    They pay my tax and ni contributions so surely im employed by them right ?? should i be keeping copys of expense receipts for my own records rather than just sending them off with my expense claim form to my umbrella company ??

    sorry if seems like silly questions but there not to me !!! .

  2. #2

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    You are correct - you are an employee of the umbrella company. They calculate and pay your taxes and NI, send you a P60 etc etc. You may still need to fill out a self assessment tax return if you meet the other criteria: HM Revenue & Customs: Do you need to complete a tax return?

    It is good practice to keep your own records of the expenses you have incurred
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  3. #3

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    Quote Originally Posted by MrRobin View Post
    You are correct - you are an employee of the umbrella company. They calculate and pay your taxes and NI, send you a P60 etc etc. You may still need to fill out a self assessment tax return if you meet the other criteria: HM Revenue & Customs: Do you need to complete a tax return?

    It is good practice to keep your own records of the expenses you have incurred
    Thank you mr robin
    i will from now on keep a record of all my expense receipts and car journeys etc . i guess its better to be safe than sorry ! really dont want the tax man knocking at my door holding his hand out !!

  4. #4

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    Keep all your receipts and keep them organised, they need to be kept for 6 years.
    Even when you hear you can buy certain things unreceipted like when staying away overnight there is an allowance for incidentals like laundry and toiletries get a receipt as you need to be able to prove and justify anything you buy.

  5. #5

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    You are an employee of your umbrella company and you shouldn't have to submit a self-assessment tax return unless you have income from another source e.g. a pension or additional tax on savings interest (if you are a higher rate tax payer). You should always have receipts for any expenses that you claim and your umbrella company may need to see them as they should undertake random expense checks to make sure that everything being claimed is legitimate. If you claim for anything that is not covered by the umbrella company's dispensation you will also need to provide a receipt for it. You should also remember that, whatever you are told, if you haven't incurred a cost you cannot claim an expense.

    HTH
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  6. #6

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    it does sound like i may aswell be a ltd company .

    i was completely new to contracting 7 months ago and the umbrella company thing was sold to me as hassle free solution .

    only reason i had turned to working this way was because of being deemed unemployable as the amount of points i accumulated on my license . But now i feel it is modt definately a better way of working .
    ever changing assignments at varied locations keep me stimulated.

    i think its time to find a reputable accountant and look to become ltd.

  7. #7

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    Quote Originally Posted by LisaContractorUmbrella View Post
    You are an employee of your umbrella company and you shouldn't have to submit a self-assessment tax return unless you have income from another source e.g. a pension or additional tax on savings interest (if you are a higher rate tax payer). You should always have receipts for any expenses that you claim and your umbrella company may need to see them as they should undertake random expense checks to make sure that everything being claimed is legitimate. If you claim for anything that is not covered by the umbrella company's dispensation you will also need to provide a receipt for it. You should also remember that, whatever you are told, if you haven't incurred a cost you cannot claim an expense.

    HTH
    all my expense receipts are sent with my expense claim form to the umbrella company every week . are you saying i should keep it ? or as my employer they should hold these on file for 6 years ??

  8. #8

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    Quote Originally Posted by bradhilt View Post
    it does sound like i may aswell be a ltd company .

    i was completely new to contracting 7 months ago and the umbrella company thing was sold to me as hassle free solution .

    only reason i had turned to working this way was because of being deemed unemployable as the amount of points i accumulated on my license . But now i feel it is modt definately a better way of working .
    ever changing assignments at varied locations keep me stimulated.

    i think its time to find a reputable accountant and look to become ltd.
    If you feel that contracting is the career choice for you then, after 7 months, you should explore the Ltd option. If you are outside IR35 you will be better off financially but you should also consider the additional paperwork and responsibilities that come with operating your own company. A good accountant will tell you this but you need to make sure that you have enough retained in the company to meet your future tax liabilities which are considerably more complicated than working through PAYE - just make sure that your accountant will provide you with a way of keeping a close eye on your obligations
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  9. #9

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    Quote Originally Posted by bradhilt View Post
    all my expense receipts are sent with my expense claim form to the umbrella company every week . are you saying i should keep it ? or as my employer they should hold these on file for 6 years ??
    If you are sending in all your receipts and they are not being returned to you then it is the umbrella company's responsibility to hold them on file.
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  10. #10

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    excellent advice here! I have a quick question too about the whole employeed / self employed. I understand that in the terms I am employed, but I really dont want to deal with the umbrella anymore, any advice on how to get out of it? My T+C's (a fellow contractor did also tell me that they are just a glorified accountant):
    16. TERMINATION OF EMPLOYMENT
    16.1 This contract of employment is terminable by you on giving the Company one month’s notice in writing, except where you serve notice to terminate your employment during an Assignment, and the notice required under that Assignment is longer than one month, in which case you must give the longer period of notice.

    Is this right?

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