Sometimes I am working in the same week for 3 agencies, each one is working with a different payroll company and each payroll company sends me different types of payslips. Sometimes I work as employee, sometimes as self employed.
To have data ready for the tax return, I have started an excel file with:
Gross pay, Net pay, Tax paid, Expenses
1. Is there any more data that I should ask ?
2. Do I need to separate Income from Self employed from the income from Employee ?
I`ve tried to complete this for each payment, but it is so difficult as sometimes the payslip does not come through the post, or sometimes just state the amount deducted and that`s it, without making clear about what is what , sometimes they use a lot of terms I dont understand, and looks more complicated.
Thank you very much,
Kind regards,
Adrian
__________________
This is just my personal opinion. Advice should be sought from a suitably qualified Accountant.
P.S. I only ride a motorbike because I want to dry my clothes faster
Just to make things even more complicated, when I work through umbrella company I am allowed to claim for daily food expenses.
You can only claim for food if it is in conjunction with an overnight stay and possibly if working at a remote site. You cannot claim if it as part of your normal working day.
For some reason umbrella schemes allow you to claim a daily food allowance -I agree with Matt it is usually only overnight stays but I have several clients that have previously been under these schemes and have been paid for them and also for their home to office mileage !
You see a lot of umbrella agencies saying you will take home 90% or whatever of their pay and of course clients think it's great. My understanding from a cpd seminar I went to some time back is that these agencies have 'over arching' contracts that have set expenses for travel, subsistence etc. I think by the time they have deducted the expenses and their own fees (Which are pretty high) the tax on the remaining income is obviously lower. I'm not sure if there have been any HMRC challenges to these expenses but you could see it happening.
my understanding is that some umbrella companies make special arrangements with HMRC rather than such being taken as the norm elsewhere.
Is that Steve Wozniak that you're paling up to at a Nigel Botterhill event?
All the best,
Shaun.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Yes it would make sense that they have some kind of arrangement in order to simplify matters but I wonder if it is more than a normal dispensation, in which case the expenses claimed still have to be proved with receipts in the event of an investigation. Any other kind of arrangement seems a little unfair on us jobbing accountants trying to do the best job we can!
I had a problem with my IOS download so I went to see an Apple Genius, was a bit surprised it was a portly older chap. Didn't catch his name!
I have a couple of Umbrella clients. I think this particular HMRC dispensation was something to do with time saving and the fact that these guys have to pay the employer's national insurance, as well as their own, but that's maybe a bit simplistic.
Each umbrella company issues guidance on what can be claimed as expenses to reduce taxable income and employer's nat ins. I tried to attach here some basic guidance but is much more detailed and has lots of rules (just removed this as it's not very legible). The workers are supposed to submit receipts for actual spend, but then usually are allowed up to the full daily amount, depending on their working hours and other things.
If anyone (really, really) wants more information I would be happy to help, but I have not yet had to do a tax return and I imagine the umbrella employment will require some special care - especially since it is often not the only paid work but is calculated in a different way as normal employment, self-employment and CIS. Adrian, obviously, if there is anything at all I can do to help with your particular situation, let me know and I'll do everything I can. Particularly, I would be really careful about stating the gross pay less expenses from umbrella and make sure that you do not pay tax or NI again on the balance.
Hel
-- Edited by HellsBells on Sunday 28th of September 2014 03:37:38 PM
-- Edited by HellsBells on Sunday 28th of September 2014 11:40:44 PM
As I said, I have the Excel sheet with: Gross pay, Net pay, Tax paid, Expenses, so I think I have to do one sheet for employee and another one for self employment income.
but I have a lot of data to process from many agencies and it looks like there will be a lot of working hours.
Is there any easier way to record all this information ?
Could QuickBooks Pro 2013 make my life easier ? or other software ?
Thank you
Kind regards,
Adrian
__________________
This is just my personal opinion. Advice should be sought from a suitably qualified Accountant.
P.S. I only ride a motorbike because I want to dry my clothes faster
""You will be employed by XX XXXXXXXXX under a restricted self-employed model, meaning that you will be classed as self-employed for law purposes, however you will be subject to tax and national insurance each week.
This will be automatically deducted, the same way as it would be if you were to be paid PAYE.
As discussed, you can lower the amount of tax and NI paid each week, through claiming expenses.""
I just got this today from a kind of umbrella company
Restricted self employed model ??????
Anyone has something about this new form of trading ?
Many thanks,
Kind regards,
Adrian
__________________
This is just my personal opinion. Advice should be sought from a suitably qualified Accountant.
P.S. I only ride a motorbike because I want to dry my clothes faster
I'm still a fledgling bookkeeper. This is what I think you should do but other people might know better.
Firstly, with regard to recording everything, I think that given all your different sources of income, and given that they are all calculated in different ways, you would really struggle to be able to control it all in one system. I think that you should make a really good Excel workbook, with a different tab/sheet for every source of income. One for each employer, one for each agency (only if they've not put you onto umbrella), one for each umbrella, one for each self-employed/CIS contract. But be careful not to count any twice as, with some of your contracts, you might be dealing with both an agency and an umbrella. On each sheet, consider what relevant totals you are trying to achieve (maybe with regard to questions on tax return forms). Some sources of income will have more columns than others. Then, make your last sheet collect all the data from your relevant totals. I currently don't have such a spreadsheet or I would send it to you.
The umbrella company will give you payslips. Just accept the figures they show, record them to their relevant columns on their own sheet and tally up at year-end. When it comes to tax return, you will have one sheet for each employment (umbrella is very probably employment but you need to be certain). This will allow you to show the gross for year and tax paid (from p60) and then the total expenses (from your spreadsheet) which the umbrella has calculated for you and shown on your payslips and has (should have) all the paperwork for. I've not yet seen an end-of-year statement from umbrella co. Maybe those will have totals of your expenses too.
I am not familiar with the term "restricted self-employed model". From your quote, it sounds a bit like a hybrid of CIS and umbrella. I think you should have a serious chat with the umbrella company about what that is. You can ask them a million questions. They have a responsibility to explain to your satisfaction. They must tell you categorically if you are to report it under "Employment" or "Self-Employment".
