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Sam
Sam, Accountant
Category: Tax
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Good evening, I need to know if the non-taxable elements

Resolved Question:

Good evening,
I need to know if the 'non-taxable elements' on my slip should be added back into my total ?
It seems every week that my wages are much lower than I expect...
kind regards *****
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.

Hi

Thanks for your question

I would expect for the non taxable elements be added back into your pay - could you give me the last pay slip details and I can check for you, I will need to know the gross pay, the non taxable elements - if you can list what these are and how much, the tax deducted, and the National Insurance deducted and also the tax code used against that pay

Can you advise further on the holiday pay position, you advise it has been added rather than taken??

Thanks

Sam

Customer: replied 2 years ago.

Good evening Sam

They say it is a computer glitch and that they do take it off and give it to me when I ask for it. It is through an umbrella company, I get paid hourly and weekly.

Last week I worked 35.5 hours @ £14.5 per hour:

£514.75 gross

tax code :1000L tax paid on this was £52.20, NIC: £36.04, holiday pay taken: £48.82 Non taxable element was £61.44 Insurance (site based): £3.00 amount I was paid: £313.25

Expert:  Sam replied 2 years ago.

Hi Alison

Thanks for your response there lies your answer, they are making you pay for your own leave, as and when its taken -

It concerns me as basically you are paying for your own paid time off, paying both Employee and Employer National Insurance, neither of which I would think they told you - as you are the owner and employee of the limited company, and the company is possibly also in breach of IR35 legislation, which states, were it not for the limited company would you in fact be an employee, and its likely the answer to this is yes -

On £514.75 as a normal employee - you should have paid £64.45 tax and £43.41 Employee National Insurance - leaving you with £406.89

They have deducted the employer National Insurance of £61.44 leaving you with £453.31 then Employee tax of £52.00 and Employee National Insurance of £36.03 - then deducted the holiday pay£48.82 (so the gross amount has been taxed and also deducted the £3 (I assume admin fee) leaving you £313.46

You are £93.43 worse off as an umbrella company and it make me breaking HMRC legislation too. I am sorry the news is not better, do feel free to ask any follow up questions

Thanks

Sam

Customer: replied 2 years ago.

Thank you Sam

Every week I end up rowing with them as I know that I am so much worse off than I was with the previous umbrella company, I will send that to the company and ask them to explain, prior to letting HMRC know.

I am not a limited company and they are aware of this, the contract also stated they would put me on the best for me plan... Which they obviously have not.

Thank you

Kind regards

Alison Whyte

Expert:  Sam replied 2 years ago.

Hi Alison

Glad to have been of help although its not with a favourable position - and these umbrella companies save the "employer" or "engager" a fortune but see the employee so much worse off, its not right

Let me know if you require any further assistance, but it would be appreciated if you could take the time out to rate/accept the response, as this ensures I am credited for my time.

Thanks

Sam

Sam, Accountant
Category: Tax
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Experience: 26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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