Agency

[Andy1982]

Hi everyone don’t post much on here but am after some advice you fellow sparks for the last few years I’ve been debating going self employed I’ve spoke to blokes on site who work via agencies, I’ve never done agency before so am completely in the dark, I’ve phoned a few agency they have said I can go PAYE with them,CIS or go as a limited company. I’m thinking of either the CIS or limited route but have never done it before so please if you have any information that would help me thanks in advance people

 

[telectrix]

first q. is are you a ltd. co.?

 

[Andy1982]

first q. is are you a ltd. co.?

No I’m not ltd but some guys on site have said it can be done in over a week

 

[telectrix]

yes it can. but is t worth he hassle? filing returns to companies house etc. CIS is easier if the agency will pay that way. you get 20% tax deducted. the agency's preferred method is the dreaded umbrella co., where you pay them a huge slice of your wages just to get them to pay you. and you'll get hit for employer's NI.

 

[Andy1982]

yes it can. but is t worth he hassle? filing returns to companies house etc. CIS is easier if the agency will pay that way. you get 20% tax deducted. the agency's preferred method is the dreaded umbrella co., where you pay them a huge slice of your wages just to get them to pay you. and you'll get hit for employer's NI.

Yeah they have said the same with the umbrella but also said the same as you that some agency don’t pay cis so that’s why they said for them ltd is a lot easier

 

[John clark]

Hi everyone don’t post much on here but am after some advice you fellow sparks for the last few years I’ve been debating going self employed I’ve spoke to blokes on site who work via agencies, I’ve never done agency before so am completely in the dark, I’ve phoned a few agency they have said I can go PAYE with them,CIS or go as a limited company. I’m thinking of either the CIS or limited route but have never done it before so please if you have any information that would help me thanks in advance people

Careful with agencies. They are complete conmen.

 

[Nigel]

yes it can. but is t worth he hassle? filing returns to companies house etc. CIS is easier if the agency will pay that way. you get 20% tax deducted. the agency's preferred method is the dreaded umbrella co., where you pay them a huge slice of your wages just to get them to pay you. and you'll get hit for employer's NI.

Being a Ltd company will not change the need to be stopped CIS if applicable.

 

[Deleted member 26818]

Unfortunately, agencies stopped paying their CIS workers direct many moons ago, though they will still pay other workers direct.
Their excuse at the time was IR35.
Instead of being paid by the agency, you will have to sign up with and be paid through a payroll company owned by the agency.
The payroll company will charge you a fee to process your payment.

So the agencies get paid by the client to supply you, and then get paid by you to be supplied.

If you have a Ltd. Co. then you should be able to be paid direct CIS from the agency, though many are now insisting you get paid through a payroll company
If you get paid direct, this will increase your earnings anything from £18 - £30 per week.

With CIS, you will have 20% of your earnings deducted at source.
You will then have to complete a Self Assessment at the end of the year, where you can claim any allowable expenses, pay your NI and claim back any tax owed.
If being paid through a payroll company, you will have the 20% tax deducted after the fee has been taken.

Umbrella is a complete scam.
You are paid as if you are an employee but no one employs you.
The payroll company charges you a fee, then deducts Tax, NI and Employer’s NI contribution from your money.
They are no longer allowed by HMRC to allow for any expenses incurred.
You will then have to file a Self Assessment to claim back the tax and NI owed on any expenses you have incurred.
Not sure what (if anything) would happen to any overpaid Employer’s NI contributions.

 

[Andy1982]

Unfortunately, agencies stopped paying their CIS workers direct many moons ago, though they will still pay other workers direct.
Their excuse at the time was IR35.
Instead of being paid by the agency, you will have to sign up with and be paid through a payroll company owned by the agency.
The payroll company will charge you a fee to process your payment.

So the agencies get paid by the client to supply you, and then get paid by you to be supplied.

If you have a Ltd. Co. then you should be able to be paid direct CIS from the agency, though many are now insisting you get paid through a payroll company
If you get paid direct, this will increase your earnings anything from £18 - £30 per week.

With CIS, you will have 20% of your earnings deducted at source.
You will then have to complete a Self Assessment at the end of the year, where you can claim any allowable expenses, pay your NI and claim back any tax owed.
If being paid through a payroll company, you will have the 20% tax deducted after the fee has been taken.

Umbrella is a complete scam.
You are paid as if you are an employee but no one employs you.
The payroll company charges you a fee, then deducts Tax, NI and Employer’s NI contribution from your money.
They are no longer allowed by HMRC to allow for any expenses incurred.
You will then have to file a Self Assessment to claim back the tax and NI owed on any expenses you have incurred.
Not sure what (if anything) would happen to any overpaid Employer’s NI contributions.

Thanks for that I will make sure I stay away from the umbrella scam