So, you should consider what your taxes are actually doing rather than be happy to pay what they ask
My Energy supplier has gone bust.
- Thread starter Robarano
- Start date
Not upsetting me I just get tired of the government sponsored 'bash a contractor' rhetoric. Now they have effectively killed the contract market in the UK who will be bleating when all the decent sized projects go to India and other exploitative markets. The reality is that UK wages are being further squeezed by stealth as contractors are forced onto paye contracts without employee benefits, those still able to contract have had their rates squeezed by approx 30% when it's finally 'fair' we'll all be in a similar life style as the former Soviet union.
Be careful what you wish for springs to mind
The contractors I've worked with over the years haven't helped the reputation of contractors.
Constantly on the phone to their 'agents'
Making a 1 month job last 3
Software programmers especially, trying to complicate what should be straightforward so they are asked back.
Yes of course.So, you should consider what your taxes are actually doing rather than be happy to pay what they ask
Pie in the sky but ideally taxpayers money used wisely would mean we all pay less and, in my opinion, the same rate.
Perhaps so, but is that the fault of the tax system or the people who hire the contractors not knowing what they are doing
You do understand that contractors do pay the same rate as you on what they spend as earnings
No, but it's tainted my opinion of them. That and them bragging about how little tax they pay and how they 'avoid' tax.
We had a contractor (Design Manager) who earnt £120k per year (and we had to show him what to do on many occasions) he paid himself and his wife £12k so as not to pay tax, then the rest as tax free dividends (£5k each for him and his wife at the time) then some at 7.5% if he needed any cash. The rest went tax free into his and his wife's pensions. He pretty much paid zero tax as did his limited company 
Duke of Prunes
Well-known member
I told myself that I wasn't going to get involved in this one ....
..... but the facts now make me out to be a liar ( or an idiot ) .
@Barry Hell and @Alan Williams have made some valid points in various posts .
I've done tech work all my life , both as a contractor and an employee and I prefer the former ,
mainly because I suffer from a severe allergic reaction to corporate bullshit .
But it's not all roses ..... while some folks may have been envious of my wages as a contractor
they usually fail to understand the effects of void periods , when there is no work at an acceptable rate ,
and the sheer hassle of dealing with your own NI and taxes ( or having to spend time and money on an accountant )
I've also worked occasionally for tech agencies , but that stopped when I went out with a lady from accounts
and I found out the difference between what the agency paid me , and what they billed the client .....
Swings and roundabouts I guess .....
.... an expression that never made any sense to me .
..... but the facts now make me out to be a liar ( or an idiot ) .
@Barry Hell and @Alan Williams have made some valid points in various posts .
I've done tech work all my life , both as a contractor and an employee and I prefer the former ,
mainly because I suffer from a severe allergic reaction to corporate bullshit .
But it's not all roses ..... while some folks may have been envious of my wages as a contractor
they usually fail to understand the effects of void periods , when there is no work at an acceptable rate ,
and the sheer hassle of dealing with your own NI and taxes ( or having to spend time and money on an accountant )
I've also worked occasionally for tech agencies , but that stopped when I went out with a lady from accounts
and I found out the difference between what the agency paid me , and what they billed the client .....
Swings and roundabouts I guess .....
.... an expression that never made any sense to me .
Do you believe what they tell you?
Their personal tax bill may be less than yours but that is not the whole picture.
A low salary will not be taxed but you can't live on £12.5k a year, dividends are taxed initially at 7.5% however, dividend payments are also taxed at corporation tax rate of 19% so they are effectively taxed at 26.5%.
You can of course split this with your spouse (if they don't work) which is beneficial, or you can pay it into a pension scheme to reduce tax (employees also have this option and get a tax benefit from it on top).
Contractors who boast about their low tax bill are the kind of people that boast about making a killing at the bookies (you know there are not 'just about even' over time)
For instance the tax man now gets less from me in tax (and I get less) as paye so what is the point of pretending contractors don't pay tax
Not the whole story on tax, but the fact he was useless isn't a tax issueWe had a contractor (Design Manager) who earnt £120k per year (and we had to show him what to do on many occasions) he paid himself and his wife £12k so as not to pay tax, then the rest as tax free dividends (£5k each for him and his wife at the time) then some at 7.5% if he needed any cash. The rest went tax free into his and his wife's pensions. He pretty much paid zero tax as did his limited company
I'm not saying they don't pay tax.
Is it fair of me to go by the lifestyles of someone doing the same job as me, but as a contractor ?
Back then him and his wife were on £34k tax free with the £5k Div each and the majority of the rest went tax free into pensions.
He wasn't useless, he just wasn't as good as a couple of other people who were salaried (and yes through choice for various reasons).
He is still working for the company and is now in his 11th year with no break in service. But he has health issues and should have retired 5 years ago as I was advising him to do
and yes the Div above £2k now is taxed at 19% + 7.5% 
So if you earned £120k and lived off £34k just coz you can that's your choice. Piling money into a pension will attract tax at a later date, the contracting model encourages the saving for a rainy day scenario because the rug can be pulled from under you very quickly. Being in the same job for 11 years doesn't strictly sound like a contract gig and that us where Al sees contractors as bad, which is fair, I see the company giving him that option as being in the wrongBack then him and his wife were on £34k tax free with the £5k Div each and the majority of the rest went tax free into pensions.
He wasn't useless, he just wasn't as good as a couple of other people who were salaried (and yes through choice for various reasons).
He is still working for the company and is now in his 11th year with no break in service. But he has health issues and should have retired 5 years ago as I was advising him to do
Everybody is free to choose their lifestyle, but unless you live an identical one you can't really judge what others are comfortable with
I couldn’t afford to have the lifestyle they have.
I get where you are coming from, and I know contracting has its problems.
My view may well be tainted by the way contractors have been used where I work.
Off topic, sorry, but…
For instance, when they’ve stopped all overtime for staff and contractors have still been working 12 hours a day 5 days a week, or when they have made redundancies but kept the contractors.
Contractors should be the buffer, when times get tough contractors are shown the door, if management aren't doing this then they are the problem not the contractors, as I said before you're being played by management and government.I couldn’t afford to have the lifestyle they have.
I get where you are coming from, and I know contracting has its problems.
My view may well be tainted by the way contractors have been used where I work.
Off topic, sorry, but…
For instance, when they’ve stopped all overtime for staff and contractors have still been working 12 hours a day 5 days a week, or when they have made redundancies but kept the contractors.
You should consider going back to contracting if you are treated so badly as a staffer, I chose contracting for that reason
Duke of Prunes
Well-known member
That's corporate accounting at work .
The " bottom line " , the profit margin , the dividend to share holders ..... those are their main concerns
.... the lives and well-being of employees come way down the list of priorities .
I once worked for an American company who cared far more about the furniture , fixtures and fittings
than they ever did about their staff ..... and I'm not joking !
I couldn’t afford to have the lifestyle they have.
I get where you are coming from, and I know contracting has its problems.
My view may well be tainted by the way contractors have been used where I work.
Off topic, sorry, but…
For instance, when they’ve stopped all overtime for staff and contractors have still been working 12 hours a day 5 days a week, or when they have made redundancies but kept the contractors.
Contractors should be the buffer, when times get tough contractors are shown the door, if management aren't doing this then they are the problem not the contractors, as I said before you're being played by management and government.
You should consider going back to contracting if you are treated so badly as a staffer, I chose contracting for that reason
I'm regularly told contracting is not worth the hassle though.
As @Duke of Prunes says that’s shitty internal accounting and budgets at work. I had a customer once, very large global bank, the IT dir was told to reduce his wage bill by 15%. Guess what happened, he spoke to all his staff, made 20% of them redundant, they got paid off, then appeared in the office next day doing the same job but as a contractor. Now it’s the operational expenses budget their costs come out of, not the wages bill budget. Most of them were still there 5 years later, contracting, doing the same job, it’s madness 
.
Mind you the bank saved on their employers NI, sick pay, holiday pay, pension contributions, company car allowance, etc etc etc so I guess a win win possibly.
. Mind you the bank saved on their employers NI, sick pay, holiday pay, pension contributions, company car allowance, etc etc etc so I guess a win win possibly.
Depends what you consider hassle and what reward you get for itI'm regularly told contracting is not worth the hassle though.
This is what the government are trying to reverse but their broad brush efforts have buggered the entire market and it's driving people abroad as well as UK projects abroad.As @Duke of Prunes says that’s shitty internal accounting and budgets at work. I had a customer once, very large global bank, the IT dir was told to reduce his wage bill by 15%. Guess what happened, he spoke to all his staff, made 20% of them redundant, they got paid off, then appeared in the office next day doing the same job but as a contractor. Now it’s the operational expenses budget their costs come out of, not the wages bill budget. Most of them were still there 5 years later, contracting, doing the same job, it’s madness
Mind you the bank saved on their employers NI, sick pay, holiday pay, pension contributions, company car allowance, etc etc etc so I guess a win win possibly.
A 'float' of contractors has to be good for companies but it is open to abuse bu both company and contractor, still government have our backs
In conclusion then (tax not energy suppliers 
)
The rules / laws are wrong whichever way you look at it.
)The rules / laws are wrong whichever way you look at it.
Whatever the tax rules/laws are there will be accountants & lawyers who study them in detail to find a way to reduce their client's tax bill legally. I think we're all in agreement that the tax rules (globally) need a ground up overhaul in order to simplify them and therefore remove altogether any ability to play the system but there isn't one party that would be brave enough to suggest that and the status quo will continue for the next few centuries.In conclusion then (tax not energy suppliers
The rules / laws are wrong whichever way you look at it.
Now, which energy supplier has gone bust today?
Ironically Mr Putin simplified Russia's tax system which promoted economic growth in the post soviet Union era
In conclusion Al, we can take it that Larry pays f### all tax and is a wrong’un.In conclusion then (tax not energy suppliers
The rules / laws are wrong whichever way you look at it.
We need to take a trip to Scotland to sort him out once and for all….
I bastard wish - PAYE here 
Just when you thought it couldn't get any worse....
Instead of one low rate for both Day and Night..... I've been forced onto a silly expensive rate both day and night....!!!
Instead of one low rate for both Day and Night..... I've been forced onto a silly expensive rate both day and night....!!!
We've been unsuccessful in transferring your direct debit, so you will need to set one up.I still haven't heard a thing or had any payments taken from my bank account.
At least I won't be doing that, so they will be forced to make contact and I'm not in debt as they owe me money.
I will continue to send readings, but no money. They are unable to cut me off as they meter / main fuse is in the kitchen.
If necessary I will go to court to get this sorted.....
I've always paid one single low rate, not a high day and low night rate... its a hang over from the old storage heaters they had in here from the 70's.
When the meter was upgraded to digital circa 1999 they didn't make it a signal rate meter, despite being asked.
"We'll just add the readings together"... ok I thought that sounds logical...
Now I'm told that as I have a dual rate meter I HAVE TO HAVE a dual rate tariff.
... looks like my desmo might have to wait.
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