daffyd:
what do you class as a poor rate?
just wonderingI’ve also been told the more hours worked the more goes in the holiday ‘pot’
Well I’ve heard that Winseer talking of £9/hr which for his area is garbage.
Just found the link I was referring to earlier
Driver Hire Umbrella is operated by Outsauce Contracting Ltd.
Left hand down!:
daffyd:
what do you class as a poor rate?
just wonderingI’ve also been told the more hours worked the more goes in the holiday ‘pot’
Well I’ve heard that Winseer talking of £9/hr which for his area is garbage.
I’m typically doing £12ph, plus expenses, plus full tax offset.
It would hardly be worth me leaving a £14.64ph job four years ago for £9ph gross now would it?
£12ph + 12.07% + tax free pay offset down by expenses - ends up being worth to me around £14.75ph. I don’t pay any umbrella commission either.
It would take therefore at least £15ph PAYE to “encourage” me to ditch my current agency, and go elsewhere. That last bit is what’s not gonna happen - rather than merely beating £9ph as you imply.
I agree that sub-£10ph is “crap” pretty much anywhere in the country, but I’ve always banged on thus in my posts, so I’m not sure what you’re getting at here.
3x12 hour shifts for example would see me to an income of around £400pw. This coming week for example, I’m on sunday,monday,tuesday and would hit the roof if I didn’t!
…I’m not expecting any pay cuts soon in other words…
This expectation of “once the dcpc spike in rates is done, back to sub-£10ph we go” is NOT going to happen. If it were, I suspect the Golden Triangle would see evidence of it first eh?
trubster:
Just found the link I was referring to earlierDriver Hire Umbrella is operated by Outsauce Contracting Ltd.
Not much detail on that page is there?
"Driver Hire Umbrella is a commercial contracting company, which employs people to provide services to our clients. As our employee, your PAYE tax and National Insurance contributions are paid directly to HMRC by Driver Hire Umbrella.
The major benefit to you is that you can claim legitimate business expenses each week that are incurred wholly and exclusively in the performance of the duties of the employment. This offsets your tax burden, which usually means you are better off. You are also not subject to the ‘IR35’ legislation that many contractors worry about.
Subject to a minimum hourly rate paid to DH Umbrella by your
Driver Hire Office. "
Contradictions abound! 
especially that last bit in orange contradicting the bit about “OUR” employee… It is this that makes contractors fall foul of IR35 - make no mistake. HMRC will still be chasing you with this outfit!
For this to actually be legit - I would insist upon a wage from the firm that proports to “employ me” regardless of what hours I do, subject to a minimum full time amount.
I would also expect all communiques regarding work placements, wage problems, expense paperwork etc. to be handled directly by them, rather than some consultant that doesn’t work for the “firm that pretends to employ you” themselves.
As it is, the driver is the CUSTOMER of the umbrella outfit, since they charge the driver (not the other way around!) and attempt to “make the driver better off” with some “expenses” some of which will not actually be legit - all to gloss over their fee which they charge for doing…well actually very little.
The actual driver hire office will continue to be employing the driver on a zero hours contract.
Thus, there is NO ‘full time employed driver’ here at all - let alone a PAYE one!
Smoke and mirrors. Talk to HMRC direct, and see what they have to say about it. Merely visiting their website, and interpreting their blurb as “best fit” just won’t do…
There have been changes to the Income Tax (earnings and pensions) Act 2003 and the Social Security (Categorisation of Earners) Regulations which came into force on 6th April 2014. I posted the links elsewhere but it is clear as day that the current Ltd/Umbrella system used by agencies is not legal.
Most relevant. hmrc.gov.uk/manuals/esmmanual/ESM2033.htm
The legislation will apply when a worker personally provides their services (see ESM2035) to a client under, or in consequence of, a contract between the client (or a person connected with the client) and an agency and the relevant conditions are met (see ESM2034). In this context, an agency is any third party interposed between the worker and the client for whom they provide the services. An agency can include an unincorporated body of which the worker is a member. (That means umbrella company) The agency does not have to place the worker with the client for the legislation to apply.
When a worker enters into arrangements with an agency to personally provide their services to a client and the arrangements come within the agency legislation, then any remuneration received by the worker (from any person) under, or in consequence of the arrangements, is treated for income tax purposes as earnings from an employment with the agency that contracts with the client (or a person connected with the client).
ALL the agencies using Ltd/Umbrella are falling foul of the agency legislation. There isn’t a single instance anywhere in the UK where it meets the conditions for not being classed as an employee of the agency. At some point in the future I fully expect HMRC to come chasing after everyone using umbrella/ltd company.
Full list of things that apply…
hmrc.gov.uk/manuals/esmmanual/esm2029.htm
Believe me when you read through all of that lot they’ve got the whole thing sewn up tighter than an 80 year old nun’s privates.
Winseer:
I’m typically doing £12ph, plus expenses, plus full tax offset.
Winseer, you and people like yourself may find sometime down the line you’re in for one hell of a tax bill. I would personally be putting 30% of everything you’re claiming as expenses away in a savings account just in case. If you’re using the figure for taxable income on your P60 as income for tax credits and other income related benefits claims, you may want to put away the money you’re getting in tax credits/benefits as well because you can’t be sure that once HMRC’s income tax department have declared your expense claims invalid they’ll not pass over your actual income details to their Tax Credits arm. If they do then all of a sudden you may find a letter demanding the repayment of overpaid benefits/tax credits.
The whole thing has a potential to come tumbling down in a big way and for all those who seem to be under the impression it’ll never happen, it happened to the IT sector and last year they started targetting the public sector. You’re basically sent a letter which gives you 20 days to prove compliance with IR35 hmrc.gov.uk/ir35/ which many won’t be able to when they meet the definition of employee, which to be honest we all know they do, and they’ve been getting some of their pay as a dividend.
Left hand down!:
daffyd:
what do you class as a poor rate?
just wonderingI’ve also been
can i ask what kind of work is getting you £12 an hour? ADR/Hiab/other ‘ticket required’ stuff?
Conor:
There have been changes to the Income Tax (earnings and pensions) Act 2003 and the Social Security (Categorisation of Earners) Regulations which came into force on 6th April 2014. I posted the links elsewhere but it is clear as day that the current Ltd/Umbrella system used by agencies is not legal.Most relevant. hmrc.gov.uk/manuals/esmmanual/ESM2033.htm
The legislation will apply when a worker personally provides their services (see ESM2035) to a client under, or in consequence of, a contract between the client (or a person connected with the client) and an agency and the relevant conditions are met (see ESM2034). In this context, an agency is any third party interposed between the worker and the client for whom they provide the services. An agency can include an unincorporated body of which the worker is a member. (That means umbrella company) The agency does not have to place the worker with the client for the legislation to apply.
When a worker enters into arrangements with an agency to personally provide their services to a client and the arrangements come within the agency legislation, then any remuneration received by the worker (from any person) under, or in consequence of the arrangements, is treated for income tax purposes as earnings from an employment with the agency that contracts with the client (or a person connected with the client).ALL the agencies using Ltd/Umbrella are falling foul of the agency legislation. There isn’t a single instance anywhere in the UK where it meets the conditions for not being classed as an employee of the agency. At some point in the future I fully expect HMRC to come chasing after everyone using umbrella/ltd company.
Full list of things that apply…
hmrc.gov.uk/manuals/esmmanual/esm2029.htm
Believe me when you read through all of that lot they’ve got the whole thing sewn up tighter than an 80 year old nun’s privates.
Winseer:
I’m typically doing £12ph, plus expenses, plus full tax offset.Winseer, you and people like yourself may find sometime down the line you’re in for one hell of a tax bill. I would personally be putting 30% of everything you’re claiming as expenses away in a savings account just in case. If you’re using the figure for taxable income on your P60 as income for tax credits and other income related benefits claims, you may want to put away the money you’re getting in tax credits/benefits as well because you can’t be sure that once HMRC’s income tax department have declared your expense claims invalid they’ll not pass over your actual income details to their Tax Credits arm. If they do then all of a sudden you may find a letter demanding the repayment of overpaid benefits/tax credits.
The whole thing has a potential to come tumbling down in a big way and for all those who seem to be under the impression it’ll never happen, it happened to the IT sector and last year they started targetting the public sector. You’re basically sent a letter which gives you 20 days to prove compliance with IR35 hmrc.gov.uk/ir35/ which many won’t be able to when they meet the definition of employee, which to be honest we all know they do, and they’ve been getting some of their pay as a dividend.
I won’t be getting a big tax bill, because I no longer claim for anything I can’t supply receipts for on a one-for-one basis.
I used to claim meal expenses for example, but proving I’ve spent £10 a day on food & drink whilst at work was unwieldly to the point of putting me at risk from the large tax demand you talk of I think. These days, I claim mileage, and make sure I don’t work more than 40% of my time at the same venue, which I don’t. If I did creep over the mark, I’d have my mileage claims revoked with immediate effect. All in all, I reckon my agency runs a pretty tight ship, thus I don’t expect any nasty surprises for that reason if nothing else.
Mileage works for me, because I barely use up all my 10,000 miles per year @ 45p which I’m able to claim as a tax offset. I don’t do 5-6-5-6 you see. More like 2-3-5-3-2-3-5-3-2 etc… Because each shift I do is longer, the commute to work per hour worked is less. If I changed to a 6 day week of 8 hours - pretty much any hourly rate - even one much higher than £12ph is going to get me shafted by the taxman, because I’d end up spending too much on commuting, and not being able to claim a profitable amount of it back via tax offset. I believe trampers profit from a similar system to the one I’m on.
What you don’t spend is as good as what you get paid - but what you ‘don’t spend’ is tax free!
The reverse is the case when, say a saver who bangs on about wanting higher interest rates doesn’t realise how much they lose when being paid say, 10% on savings with inflation at 15%, compared to being paid 5% on corporate bonds with the inflation rate @ 2% like as at present. RIght now, those not in the know will moan a lot, but leave their cash in a savings account (instead of bonds) losing 1.5% per year. Those on 10% in the 90’s however, LAUGHED whilst they lost 4.5% a year (10% less tax at higher rate) - bringing their real return back down to “level with inflation or lower” again.
The true return of course, is (gross rate-tax)-inflation rate which means it’s quite possible to save for years and years, and lose more and more money the more you save!
If you used that savings money to buy stuff with instead, you’d not only pay less tax on the less savings that remained, but paid 0% on credit - because you didn’t need to borrow to make the purchase! Win-Win! People who’ve got so much money they never need to borrow, and nearly all their earnings go into savings - are not likely to be truck drivers so can be safely disregarded here.
‘Less is more’ in the world of racing to the bottom. What you didn’t get in the first place on your top line won’t be taxed as much as a bigger top line with a massive reduction.
Earn £300 take home £280 is better than earn £500 take home £360… I object to working half of thursday and all of friday just to give it to the taxman - so I don’t.
It’s perfectly legit to choose to work less shifts than a full timer. It’s the main thing I get from working agency if you will… 
Working at multiple locations rather than just a handful means there’s no danger the mileage aspect will be revoked, and as I fill up every week, there’s no danger I’ll be “disallowed” because I’ve not kept and handed over all my receipts either. 
It also explains my main reasons for why I don’t bother with “self-employed” despite it paying a higher hourly rate. It’s not all about “lost holidays/sick pay” since I’ve not taken a proper holiday abroad or gone sick per se these past 4 years I’ve been on agencies.