Tax..

[festive]

On a flight home today got talking to a chap about his son who works as a contractor. He was forced as many are now to work for an umbrella company.

Studied for 10 years now earns good money on multiple contracts. However I just find it plain wrong for example he’s earning 3500 a week out of that he pays 1800 in tax and takes home 1600 due to umbrella company NI and
Levy’s plus personal tax and NI.

It’s beyond ****ed up. How can that be fair?

I don’t begrudge anyone being paid well for hard work and sacrifices but this just seems beyond fairness.

 

[Diydavey]

On a flight home today got talking to a chap about his son who works as a contractor. He was forced as many are now to work for an umbrella company.

Studied for 10 years now earns good money on multiple contracts. However I just find it plain wrong for example he’s earning 3500 a week out of that he pays 1800 in tax and takes home 1600 due to umbrella company NI and
Levy’s plus personal tax and NI.

It’s beyond ****ed up. How can that be fair?

I don’t begrudge anyone being paid well for hard work and sacrifices but this just seems beyond fairness.

£6400 take home pay per month,how does he make ends meet?

 

[Deleted member 18243]

On a flight home today got talking to a chap about his son who works as a contractor. He was forced as many are now to work for an umbrella company.

Studied for 10 years now earns good money on multiple contracts. However I just find it plain wrong for example he’s earning 3500 a week out of that he pays 1800 in tax and takes home 1600 due to umbrella company NI and
Levy’s plus personal tax and NI.

It’s beyond ****ed up. How can that be fair?

I don’t begrudge anyone being paid well for hard work and sacrifices but this just seems beyond fairness.

Someone has got to pay for the immigrants, single mothers, covid furloughs, foreign aid etc etc.

 

[festive]

£6400 take home pay per month,how does he make ends meet?

Yep typical response. Diydavey say tomorrow you were earning this. Maybe want to give your kids private education. Private health care and a pile the rest into a mortgage on a good home and car and contingency money saved as you may be out of contract 6 months of the year. Do the maths. Maybe he doesn’t want to meander in the slow lane till 65. Who cares but why be punished so hard. He’s taxed more than he earns.
Or is that how u feel I don’t earn that much that’ll teach him for being so privileged.

 

[festive]

Someone has got to pay for the immigrants, single mothers, covid furloughs, foreign aid etc etc.

That’s the most sickening thing. If he was taxed less I’m sure he’d pay more people locally to do more for him. Instead that money is taken and given to wasters scroungers and return trips to points of origin.

 

[johnny2007]

£6400 take home pay per month,how does he make ends meet?

Must be a plumber...
Oh, no.
Just realised you said "per month".
Plumbers make that in a week.

 

[kingandy2nd]

On a flight home today got talking to a chap about his son who works as a contractor. He was forced as many are now to work for an umbrella company.

Studied for 10 years now earns good money on multiple contracts. However I just find it plain wrong for example he’s earning 3500 a week out of that he pays 1800 in tax and takes home 1600 due to umbrella company NI and
Levy’s plus personal tax and NI.

It’s beyond ****ed up. How can that be fair?

I don’t begrudge anyone being paid well for hard work and sacrifices but this just seems beyond fairness.

He clearly needs to get himself a better accountant

 

[Mottie]

I've known a few people that got paid through one of those umbrella type companies. Supply/agency teachers mostly. Always moaning about their costs/stoppages. I always wondered why they just didn't get an accountant and sort themselves out but they were all dimbo's as far as that stuff was concerned.

 

[ajohn]

Some companies told their workers to set themselves up as self employed contractors. That way work related expenses could be deducted from pay before tax was applied. No idea how things were changed but the result is a move to PAYE where no one can claim what it costs to get themselves to work, car costs etc before tax is applied. Years ago some unions managed to get the cost of a suite to be tax free in a job where people might be expected to wear a suite. It was added to a person's personnel allowance.

So contractors work for a company they provides contractors. They take a cut and may negotiate rates. A contract as far as I am aware will have a duration and an hourly rate and would be paid monthly not weekly. Temps are handled in the same way. Fact of life - both types usually earn more than being employed direct. A lot more is some fields. The basic idea is pay more as they may not be employed all of the time. Fact of life - some are. So they are earning more than they normally would so what on earth are they moaning about? If they can't get full employment taxation changes as it's based on yearly income.

The money of course goes to scroungers. Another fact is that it's rather difficult to find where it does go and other reasons why taxation levels are where they are.

Currently there are 1.3m unemployed people. Seems this is a touch better than pre covid where numbers went up. There are 8,857,000 economically inactive people of working age. Hard to say what either means as people can move in and out of both groups. This area and various state support packages make the whole thing even more complicated.

IMHO the whole thing is too complicated and fact of life people can have a job and still not really get enough to survive. The NMW becomes a max for a lot of people. Child support is interesting - how many get it that don't need it?

 

[Diydavey]

Yep typical response. Diydavey say tomorrow you were earning this. Maybe want to give your kids private education. Private health care and a pile the rest into a mortgage on a good home and car and contingency money saved as you may be out of contract 6 months of the year. Do the maths. Maybe he doesn’t want to meander in the slow lane till 65. Who cares but why be punished so hard. He’s taxed more than he earns.
Or is that how u feel I don’t earn that much that’ll teach him for being so privileged.

I don't have a problem with how much he earns.
I was questioning why you were moaning on his behalf about paying for using an umbrella company because he can't be bothered to sort his own tax out?

 

[ajohn]

paying for using an umbrella company because he can't be bothered to sort his own tax out?

Depends on what he does. In some fields companies approach another one that handles contractors and ask for a person with specific skills. They effectively provide the work for the people they handle. A software engineer for instance with certain skills wouldn't get much work by advertising in yellow pages. Same applies to a number of technical areas.

 

[festive]

I don't have a problem with how much he earns.
I was questioning why you were moaning on his behalf about paying for using an umbrella company because he can't be bothered to sort his own tax out?

It's not as simple as that. And if you think it is you are as simple as that. Go have a read up on tax law and ir35. Its a resentment tax. Its all about stopping people chosing risk and reward using limited companies as a tax efficient way of payment right. These people WERE sorting their own tax out that's been taken away because hmrc resents this as some kind of privilege. Do you honestly think people of this calibre are stupid enough not to research the most tax efficient way to be paid?

So making a flippant observation like this when you obviously have no fking idea makes me want to multiple face palm myself over such comments
Omfg. ..

 

[IT Minion]

Depends on what he does. In some fields companies approach another one that handles contractors and ask for a person with specific skills. They effectively provide the work for the people they handle. A software engineer for instance with certain skills wouldn't get much work by advertising in yellow pages. Same applies to a number of technical areas.

Yes, they're called recruitment consultants.

 

[festive]

Some companies told their workers to set themselves up as self employed contractors. That way work related expenses could be deducted from pay before tax was applied. No idea how things were changed but the result is a move to PAYE where no one can claim what it costs to get themselves to work, car costs etc before tax is applied. Years ago some unions managed to get the cost of a suite to be tax free in a job where people might be expected to wear a suite. It was added to a person's personnel allowance.

So contractors work for a company they provides contractors. They take a cut and may negotiate rates. A contract as far as I am aware will have a duration and an hourly rate and would be paid monthly not weekly. Temps are handled in the same way. Fact of life - both types usually earn more than being employed direct. A lot more is some fields. The basic idea is pay more as they may not be employed all of the time. Fact of life - some are. So they are earning more than they normally would so what on earth are they moaning about? If they can't get full employment taxation changes as it's based on yearly income.

The money of course goes to scroungers. Another fact is that it's rather difficult to find where it does go and other reasons why taxation levels are where they are.

Currently there are 1.3m unemployed people. Seems this is a touch better than pre covid where numbers went up. There are 8,857,000 economically inactive people of working age. Hard to say what either means as people can move in and out of both groups. This area and various state support packages make the whole thing even more complicated.

IMHO the whole thing is too complicated and fact of life people can have a job and still not really get enough to survive. The NMW becomes a max for a lot of people. Child support is interesting - how many get it that don't need it?

I dont quite get this brain dump however many people make life choices and sacrifices. Some spend years training and research to be paid as such. Just as a manual worker or builder over time gains skills or becomes an sme in such a specialist area he she isn't just an off the shelf worker.

The problem with ir35 it doesn't differentiate here.

People who work hard and who build a framework to support themselves and their family now and for thr future shouldn't be penalised.

I dont see the Incentive for future generations currently.

 

[ajohn]

So making a flippant observation like this when you obviously have no fking idea makes me want to multiple face palm myself over such comments
Omfg. ..

Correct. If the contractor idea worked as it did all jobs could end up doing the same. Less tax would be collected. That sort of job can have disadvantages though. No guarantee of work all of the time. Getting a mortgage may prove difficult. I think there are also get outs as far as the employer is concerned but not sure about that.

Anyway - the tax people decided to plug the hole as it was cropping up more and more often. It can still pay way more then people get when employed the usual way. People who do it successfully say the same thing. Have to get used to regular moves to a new work area with different people in it. Bit like changing jobs rather regularly,