Non-motoring > Umbrella Companies - pay for agency work Legal Questions
Thread Author: Dave_ Replies: 22
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 Fri 2 Sep 11 15:03 
 Umbrella Companies - pay for agency work - Dave_
Has anyone got any experience of Umbrella Companies? I've been offered some temporary driving agency work through an agency which doesn't directly employ its drivers. All its workers are either self-employed or employed by an umbrella company called Maxipay Accounting Services. They claim to increase take home pay by offsetting work related expenses against taxable income, in much the same way as the self-employed.

The agency have told me that because the work will be at various locations I can claim mileage for commuting to and from the customer, as well as claiming an allowance for lunch every day which will more than compensate for the £12 weekly fee charged by the umbrella company for payroll processing. Is it a good idea?
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 Fri 2 Sep 11 15:08 
 Umbrella Companies - pay for agency work - Alanovich
I spent 3 years contracting some time ago. The first two were under a limited company whcih I was Director of, and it was murder administratively. Hated every minute of it.

Then I switched to an umbrella company and was no worse off financially. I got paid a full salary every month just like under PAYE, and I had no admin to do whatsoever. Bliss. I would recommend it particularly for short term contracting. If you intend to contract for many years, at a high rate, then perhaps a limited company will offer you more financially in the long run, but, if, like me, you hate admin and wondering when the next crappy tax/VAT related issue will fall out of the sky, then go umbrella.

My umbrella company was called Parasol and they were excellent.
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 Fri 2 Sep 11 15:21 
 Umbrella Companies - pay for agency work - Pat
Be very wary Dave

Agencies (for lorry drivers) have just started doing this since the new laws for Agency drivers were brought in a few weeks ago.

It gets them out of having to pay you the same rate and give you the same conditions as an employed driver (holiday pay etc)

Google the new law and find out more about it.

Pat
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 Fri 2 Sep 11 15:25 
 Umbrella Companies - pay for agency work - Alanovich
To add to that following Pat's contribution: I was contracting in IT, not driving.
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 Fri 2 Sep 11 15:33 
 Umbrella Companies - pay for agency work - rtj70
My employer (in IT) does not dealing with umbrella companies etc for contractors.

Dave says it's only for a few weeks and presumably he is still looking for employment. So maybe worth a try.

As pat says though, worth a quick read-up on this with respect to umbrella companies and driving.
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 Fri 2 Sep 11 15:42 
 Umbrella Companies - pay for agency work - Pat
tinyurl.com/3e6arg7

Here's a link worth a read and also the Driver Hire article at the bottom right of the page.

Pat
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 Fri 2 Sep 11 15:54 
 Umbrella Companies - pay for agency work - Bromptonaut
Thanks Pat. Mrs B works as a supply teacher and has been trying to get to bottom of effects on her profession. Like your link the conclusion seems to be that it's unavoidable and will have to be lived with.

She's actually got a contract direct with a local school full time until Xmas covering long term sick. Whether they've ofered the job that way to avoid complications with agency rules is not known!!
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 Fri 2 Sep 11 15:42 
 Umbrella Companies - pay for agency work - -
You'll probably be better off in your take home pay Dave, many long term drivers go self employed if agency work suits them, however have they really got enough work to keep you going or are they all wind an p, most are.

Good point about holiday pay, i worked for 3 agencies on PAYE during the last 2 years.

The first one never paid me any holiday pay when i left, neither did the second which is now in receivership and i'm a creditor so i'll get nowt there either, the third did pay me holiday pay owed when i left, but still haven't sent my P45 on....no probs i contacted the tax office and have now completed P46 which will sort the situation out.

If you put as much faith in the promises of an agency as you do a politician you won't go far wrong.
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 Fri 2 Sep 11 15:59 
 Umbrella Companies - pay for agency work - Dave_
From the leaflet I've got here:

"Maxipay Accounting Services provides Umbrella Companies which will give you increased take home pay and a number of other great benefits. Benefits include:

Fully employed status with all statutory benefits such as sick pay, holiday pay and maternity pay
Use your work related and other expenses to increase your take home pay
Dedicated account manager
Comprehensive insurance cover
Customer Service Team available 8am to 6pm

You will not be self-employed or have any IR35 or MSC legislation concerns. Maxipay works with leading industry experts to ensure that you get the best deal for working through an Agency."
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 Fri 2 Sep 11 15:51 
 Umbrella Companies - pay for agency work - Mapmaker
>> They claim to increase
>> take home pay by offsetting work related expenses against taxable income, in much the same
>> way as the self-employed.
>>
>> The agency have told me that because the work will be at various locations I
>> can claim mileage for commuting to and from the customer, as well as claiming an
>> allowance for lunch every day which will more than compensate for the £12 weekly fee
>> charged by the umbrella company for payroll processing. Is it a good idea?

You write, "they claim". Dead right. They lie through their teeth. There is no way on God's earth that you can claim for lunch against tax. Ever.

Once upon a time I did some contracting. And although it was expected, I refused to be paid through an umbrella company as they clearly didn't have the foggiest what they do. (I work in tax, BTW.)

The transport costs you can claim (broadly) the lesser of (a) the distance from your "normal place of work" to other sites and (b) home to other sites. It may well be that your home is where your business is based - what with being self-employed etc. etc.
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 Fri 2 Sep 11 15:59 
 Umbrella Companies - pay for agency work - Mapmaker
But if you're based working at just one site then - even if you're a "contractor" - you cannot claim travel expenses.
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 Fri 2 Sep 11 16:13 
 Umbrella Companies - pay for agency work - Dave_
>> if you're based working at just one site

It'll be relief driving, so different sites all the time. I know one of the drivers there, he says he's happy with working for them so I'll give it a go. Can't be any worse than being on the rock'n'roll.

The idea of employment rights has always been slightly alien to me, at my end of the market I've always been shafted when it comes to holiday pay etc, so I don't expect a lot.
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 Fri 2 Sep 11 16:29 
 Umbrella Companies - pay for agency work - Pat
With that attitude you will continue to be shafted Dave. *want to pick you up and shake you* :)

You're intelligent, you can read, and you can understand what you're entitled to so don't allow them to think you're another idiot who believes all the things they 'claim' to do.
Listen to mapmaker.

They rely upon drivers wanting an easy life and not bothering to read the small print and if you all refused the agencies would have to face up to these new laws and get their act together.

Pat

Last edited by: pda on Fri 2 Sep 11 at 16:30
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 Fri 2 Sep 11 16:31 
 Umbrella Companies - pay for agency work - Dave_
>> They rely upon drivers wanting an easy life

But there are tens of applicants for every job. Beggars at my level can't afford to be choosers.

Another operator gone down the tubes locally last week apparently, bigger than mine was too. Lots of drivers chasing not many jobs around here at the moment.
Last edited by: Dave_TDCi on Fri 2 Sep 11 at 16:33
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 Fri 2 Sep 11 16:42 
 Umbrella Companies - pay for agency work - Pat
It's the same everywhere Dave, and a lot worse in some areas than in the Midlands.

Agency work is temporary work, not a job.

I know agency drivers who are reeling because they've only been getting a couple of days a week during the last 6 weeks of the holiday period when they're usually ran ragged.

There are jobs out there if you're determined. Go and visit to put your name down. Go ready to do a days work should someone not have turned in that day.
Let them see you, know you as a person and not a name, see your determination to get a job.

Set yourself up as a self employed driver and go directly to the firms for work.
Ask if you can ring them each Monday morning.
Tell them your rates which will be a bit less than the agency charges them.

Get some flyers printed off and get them around local firms.

If nothing else it will get your enthusiasm back instead of the resignation I can hear in your posts.

There might be a lot of drivers out of work but you're better than them, arn't you?

Kick up backside needed.........and given:)

Pat
Last edited by: VxFan on Tue 13 Sep 11 at 01:30
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 Fri 2 Sep 11 15:59 
 Umbrella Companies - pay for agency work - Bromptonaut
>> You write, "they claim". Dead right. They lie through their teeth. There is no way
>> on God's earth that you can claim for lunch against tax. Ever.

Glad somebody who has professional knowledge of the area comes to that conclusion as well. HMRC guidance also seems pretty clear that the school the agency send Mrs B to is her ordinary place of work for that day. Cannot see why it should be any other way really.
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 Fri 2 Sep 11 16:03 
 Umbrella Companies - pay for agency work - Alanovich

>> is her ordinary place of work for that day.

So how is any form of travel ever to a place which is not your "normal place of work for that day"? By that definition, no one could ever claim a travel expense.
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 Fri 2 Sep 11 16:08 
 Umbrella Companies - pay for agency work - spamcan61
Presumably all these Umbrella companies work the same way, claiming that your home is your normal place of work; hence claiming travel expenses, lunch etc. for your actual place of work.
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 Fri 2 Sep 11 16:14 
 Umbrella Companies - pay for agency work - Mapmaker
>> Presumably all these Umbrella companies work the same way, claiming that your home is your
>> normal place of work; hence claiming travel expenses, lunch etc. for your actual place of
>> work.

They get *you* to claim your home is your normal place of work. You tell them this, they assess your tax on this basis - and claim their £11 per week. HMRC come calling, discover you told the the wrong information, and *you* are the one with interest and penalties and a tax investigation.
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 Fri 2 Sep 11 16:12 
 Umbrella Companies - pay for agency work - Mapmaker
There is no way you can claim for your lunch, ever.


There is no way you can claim for regular travel to the same site, as in Mrs B's case. Alanović you have read too much into "for that day". Clearly e.g. Brompton works at an office by Chancery Lane and that is his normal place of work for 365 days of the year. If his employer should choose to send him to Staines for the day, then the travel costs would be tax deductible as his normal place of work for that day is still Chancery Lane.


Disclaimer: I do not do personal tax for a living. But I am very wary indeed of umbrella companies having been told by them about the benefits they allege that are untrue. It strikes me that being employed by an umbrella company is an invitation to HMRC to open an inquiry. They go on about agreements with HMRC for reimbursing spending without supplying them with a receipt. That's true, *they* have these agreements. *You* still have to have, and keep, these receipts.
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 Fri 2 Sep 11 16:19 
 Umbrella Companies - pay for agency work - Alanovich
The way I treated working under an umbrella was as if I were a PAYE employee.

I went to work, submitted my timesheets to the employment agency who had placed me, my agency paid the umbrella company, who then paid me a weekly salary after deducting income tax, NI etc. I did not claim a single penny of expenses, mileage, travel, lunch, nothing. I was working at one location, in an office building away from home, and that was that. I took the attitude that to do otherwise was dishonest.
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 Fri 2 Sep 11 16:47 
 Umbrella Companies - pay for agency work - Mapmaker
>>There is no way you can claim for your lunch, ever.
>>There is no way you can claim for regular travel to the same site, as in Mrs B's case.

Sorry, those two sentences should have been more clearly associated with Mrs B. If working awy from your usual site you should be able to claim for lunch. Though again, the law is muddy on this point as if you would have bought a sandwich when at the office then there is no reason why HMRC/your employer should help out if you buy the self same sandwich when at a temporary site. www.hmrc.gov.uk/manuals/eimanual/eim31815.htm
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 Fri 2 Sep 11 16:20 
 Umbrella Companies - pay for agency work - Cockle
>>
>> >> is her ordinary place of work for that day.
>>
>> So how is any form of travel ever to a place which is not your
>> "normal place of work for that day"? By that definition, no one could ever claim
>> a travel expense.
>>

We used to get two different levels of subsistence payment for lunch up until a few years ago; a taxable rate if we were absent for, IIRC between 5-7 hours over the lunch period and a, second, non taxable rate if we were absent for over 7 hours. To get it we had to be based at a regular place of work and then be required to travel from that place to a second for the day.

I don't qualify these days but I believe there is something termed something like 'mobile workers allowance' whereby someone who attends more than one or two sites during the day is classed as mobile and is allowed to partake in a salary sacrifice scheme which effectively makes their out of pocket expenses tax free.

Found this link for Brook Street workers, I believe BT use something similar.

www.brookstreet.co.uk/TemporaryWorkerZone/TSACandidateFAQ.pdf
Last edited by: Cockle on Fri 2 Sep 11 at 16:22
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