5 ways umbrella company contractors can save money!

It’s no secret that contractors, freelancer and temporary workers have to deal with a higher degree of uncertainty in terms of where there next job/contract will come. This uncertainty means that saving for a rainy day whilst making your money work harder for you is crucial. There are some simple ways umbrella contractors can become more efficient with their money and we have outlined 5 areas for consideration;

1.Reduce your current bills…Just ask

Sometimes by simply picking up your phone or searching online for better deals, you can actually put yourself in a position to barter with existing service providers, whether it’s your mobile service provider, gas & electricity provider or something else. E.g. I wasn’t happy with my current mobile provider (not service related) simply because some of my colleagues were offered upgrades, additional prizes and a generally better tariff. In the end I finally allocated the time to call up my provider and put forward my issues…I hung up with a £20 a month discount on my tariff with a new blackberry being sent to me within 3 days.

2.Spend less and save more… Have you considered an ISA account?

Making the most out of any cash left over at the end of the month should become a priority for contractors and freelancers. Fixed rate ISA’s can pay better interest rates than those available on other savings accounts. For example, the Post Office offers a two year fixed-rate ISA at 3.1% while the Halifax is currently offering a rate of 2.8% on a variable rate ISA with unlimited withdrawals.

3.Recycle

I’m not just talking about reusing tinfoil or using your milk cartons as small flower pots. There is actually ways to reuse many other things that wouldn’t even pop into your head.

4.Cut your food costs
This is something you can save some money on. We all need to eat, however could you plan out your meals more effectively? Sometimes making a big dish then freezing or chilling the left over’s for tomorrows lunch or dinner will save you nipping to the shop and buying a sandwich, some crisps and a soft drink (e.g. if you spent £5 a day on lunch it would amount to £1200 a year if we base it on 240 working days a year!).

5.PAYE Umbrella Company or Limited Company?

Have you ever pondered on how much better off you could be working through your own Limited Company? Well if you are a contractor earning more than £16 per hour it could certainly be a much more tax efficient way for you to work. It is definitely worth getting some free expert advice from a specialist contractor accountant like Danbro, who can assess how much better off you could be.

Danbro are a firm of regulated Contractor Accountants and can give you some great advice.

By Gerry Gregoire – Marketing Consultant at Danbro

OTS’s review will focus on more than just IR35

The Office of Tax Simplification (OTS) is reviewing small business taxation which covers more than just IR35. Although much of the limelight surrounding the review has fixed itself on the infamous IR35, small business taxation covers a broader range of elements which could have a significant impact on the income and operating methods of IT contractors.

We have outlined some areas which the OTS may review;

Disguised Remuneration

Many commentators within the industry believe that it is only a matter of time before HMRC reclassify dividend payments as being remuneration which would effectively mean those dividend payments would be subject to higher tax.

Example – PA Holdings Case in 2010 may be a sign of things to come http://www.accountingweb.co.uk/topic/tax/pa-case-raises-dividend-fears/453911

Husband & Wife Limited Companies

The announcement made by the Government to stop child benefit for families that have a high rate taxpaying spouse will likely lead to husband and wife companies to be reviewed by the OTS.
The fact that some contractors operating their own business can share income between spouses and even leave profits within their Limited companies to avoid the higher rates of tax, enabling them to still qualify for these benefits, certainly increases the likelihood that this area will come under scrutiny.

Defining a Professional Contractor

Independent body Professional Passport has been calling for a clear unambiguous way to identify;
Professional Contractors; “ those that see their long term career as a contractor, do not want any enhanced rights or protection and see themselves as operating their own business with associated risks” From;

Temporary contractors; “those that contract until they can find a new permanent position”

A clear set of criteria would allow appropriate legislation to be applied (i.e. IR35 or agency workers regulations would not apply to professional contractors).

You’re Views Matter

Professional Passport has been instrumental in giving contractors a voice. The Office of Tax Simplification is taking on board your views through the contractor polls and surveys, to help its mission to review the way small businesses are taxed including IR35.

You can contribute to the following three surveys;

Contractors Opinion Poll https://www.professionalpassport.com/Contractors/685 : A wide range of questions on many issues facing contractors in general

IR35 Survey https://www.professionalpassport.com/Contractors/70 : Share your opinions on IR35

Defining a Professional Contractor https://www.professionalpassport.com/Contractors/664 – How to identify Professional Contractors and remove them from the red tape that currently exists

Article created by Danbro – Contractor Accountants and UK PAYE Umbrella Company

Umbrella Company Contractors to meet the OTS

The Office of Tax Simplification (OTS) has agreed to meet with contractors in an attempt to gain a better insight into the main issues they face in today’s market.

The remarkable opportunity has been made possible by independent body, Professional Passport whose contractor surveys have provided practical evidence, challenging some of the current perceptions that currently exist about the flexible workforce market.

Professional Passport have been instrumental in lobbying for changes to be made relating to the way the flexible workforce is both perceived and managed. The independent body has also arranged for other interested parties such as recruitment companies, end clients and umbrella companies to meet the OTS which will allow each sector to put forward their thoughts directly. Professional Passport states;

“…this review provides a unique opportunity to address many of the issues currently faced in the temporary workers market and whilst the review is focussed on small business taxation including IR35 we are certain it will through up a range of much wider issues that exist. Highlighting these wider issues now could provide a platform for more far reaching reviews and changes to the market in future.”

Danbro, the UK’s most reputable contractor accountants and PAYE umbrella company provider, believes this is a great opportunity for contractors to make their opinion count. Although only a handful of contractors will be meeting with the OTS, it is still worthwhile contributing to the contractor’s opinion poll, as these results will be discussed in the meetings organised by Professional Passport.

UK recruitment firm director banned for 7 years…Why?

The Director of a recruitment firm supplying rail workers has now been banned for seven years following tribunal action taken by the Employment Agency Standards inspectorate (EAS).
The tribunal was told how Christine Lewiss, from Trimmingham near Norwich, withheld wages totalling over 11,000 pounds. She was operating two recruitment agencies; Rail Recruit UK Ltd & Rail Recruit UK Projects Ltd.
The tribunal went on to ban Mrs Lewiss form operating any employment agency/company for the next seven years.

Edward Davey, the Minister responsible for Employment Relations, said “this verdict should act as a warning signal to agencies who exploit their workers. We will take action against rogue recruiters in Norfolk, and across the country, who flout the law and undermine the vast majority of agencies who play fairly.”

EAS brought this case under the Employment Agencies Act 1973.

For further details, please contact Danbro
Contractor Accountants on: 01253 600141,
General Enquiries: 01253 600140,
London Office: 020 7836 8400 or
E-Mail: enquiries@danbro.co.uk

How to avoid emergency tax codes while contracting

Hi, my names Alex and I work for Danbro Contractor Accountants, as part of the marketing team. In this article I will be addressing the issue of emergency tax codes that may affect contractors when they move from contract to contract and what measures they can take to avoid this.

Emergency tax codes take effect when contractors don’t have a P45 to give their new employer. The emergency tax rate is usually much higher than the standard tax rate therefore the contractor ends up being taxed much more of their earnings. An emergency tax code is the same for everyone and is based on the tax-free earnings allowance. As most people are paid monthly or weekly, a contractor’s tax-free allowance is spread over the year. Emergency tax codes were introduced by HMRC to help improve their cash flow.

A P45 form will show the earning and income tax that has been accumulated so far for that contractor, and will also show the previous tax code so the new Umbrella Company can use it. A P45 is issued automatically when you leave your previous employer with a copy also being sent to HMRC.

When a contractor starts work for an umbrella company they usually get placed under an emergency tax code. As part of our application process Danbro sends out a blank P46 to be completed by the contractor and then we send this to HMRC. The P46 allows HMRC to generate a new tax code for the employee, and any unnecessary tax that has occurred due to the initial emergency tax is reimbursed to the contractor in a lump sum.

To avoid an emergency tax code, contractors who have a gap in their employment or are between contracts are able to apply to HMRC for a tax code in advance. The advantages of this are; when the time comes to start their new contract, they will hopefully have the correct tax code back from HMRC to give to their umbrella company to avoid getting emergency taxed.

Umbrella Company Calculator

For further details, please contact Danbro Contractor Accountant:
General Enquiries: 01253 600140,
London Office: 020 7836 8400 or
Email: enquiries@danbro.co.uk

4 Great Tips When Promoting Yourself as a Contractor

Self promotion as a contractor is essential, which is why we have outlined 4 great tips for you to consider;

1.Create a Killer CV
The CV is still an essential tool when competing for the latest job opportunities. It’s important that your CV stands out from the other two hundred that a recruitment consultant has to filter through. It’s likely that the client looking for a suitable candidate will be presented with a shortlist of CV’s… Will yours be in that shortlist? Read More on creating a Killer CV

2.Build a valuable team around you
Although you are an independent contractor and perhaps feel you can go the distance on your own, it’s important you develop and value those relationships which could benefit you in the longer term. For example; Ensure you sign up with the right recruitment agencies whilst developing relationships with those consultants that go the extra mile for you; Make sure you choose a reliable Umbrella Company/ Accounting firm (for your reassurance Danbro is rated as a Top 3 Umbrella Company by Umbrella Detective and is recognised as a ‘Quality Accountant’ by the Professional Contractors Group); keep up to date with industry news by following the most reputable bloggers and tweeters in your industry and then pass it on; When you land a contract for a client, ensure you keep in contact with the main HR managers (perhaps send a birthday card). The whole point of building and valuing these relationships is that more opportunities will come your way; job opportunities, tax saving advice, introductions and so forth.

3.Discover Your Personal Brand
Get a piece of paper and write down what you specialise in and what value you can offer to others. Is there anyone else out on the net offering good, helpful advice to others in your niche? If not, or perhaps you feel you could contribute further, there is a real opportunity to create your personal brand. For example, Joel Comm has mastered the Google Adsense niche and brands himself using his name…Why not do the same? You can become known as an expert within your field by simply contributing in forums, linkedin, twitter, article sites, blogger and more, which all can lead to recommendations and further business opportunities for you to grasp.

Founder of E-Academy, Penny Power said “By feeding others, you will feed yourself”, which I think sums up the above tip quite well.

4.Do as you say
You’ve probably watched Watchdog before. Well usually there are a few unscrupulous companies on the programme where they’ve made promises to customers but never deliver on those promises and it’s the same in the contracting world.

It’s important that if you promote yourself as holding a particular skill set, that you can deliver the end product. You should brush up on your skills through courses, books, e-books, useful articles and anything else that will improve your knowledge, which you can apply on future contracts, leading to yet more opportunities as a sought after contractor.

Effectively promote yourself as a contractor today and have a brighter future tomorrow.

5 ways to improve your Personal Brand Online

As a freelancer/contract or temporary worker you have an opportunity to build your own personal brand. You may have a specialist skill set which could be utilised in such a way that it could benefit you further if enhanced online. I’ve created these 5 simple tips for you to implement and hopefully it will help in creating your personal brand online.

1.Discover – Get a piece of paper and write down what you specialise in and what value you can offer to others. Is there anyone else out on the net offering good, helpful advice to others in your niche? If not, or perhaps you feel you could contribute further, there is a real opportunity to create your personal brand. For example, Joel Comm has mastered the Google Adsense niche and brands himself using his name and as a result gets tonnes of business…Why not do the same?

2.LinkedIn – If you’re not on here you’re missing out on networking with others sharing an interest within your industry sector. Also, Linkedin is the tool that recruiters are using more and more to find suitable candidates to fill roles. It’s also a great way to build up your client testimonials for others to view.

3.Feed others – A great quote I came across by Penny Power was ‘by feeding others, you will feed yourself’. Essentially what she was conveying was; that by giving free advice to others seeking it on forums, blogs or other social media sites, you will become recognised as someone who knows what they are talking about (providing the advice is right in the first place). As a result, you will reap the rewards when others start recommending you. Get involved in forums related to your industry.

4.Create a good ‘social media CV!’ – Most people working in the contract/freelance industry have to create a CV, but do you update it? Ensure it’s up to date and reads right. Here’s a great article on building your social media CV. Promote what you can do to the world and share it with as many people as you can!

5.Video resume – This is something for those that feel comfortable creating a short (minute or so) video of why you are a suitable candidate for a certain role. You can upload your videos on you tube and then send the link to hiring agencies.

There are a number of resources out there for you to use when creating your personal brand online. Creating a brand doesn’t happen overnight. It’s important that you don’t see it as just a way to drive business or help land you your next job as it will become an effort when building up your name, however if you have a passion and are willing to invest some time, the long term results can be invaluable.

In summary;

a)Get people to know you (i.e. as a person and as a professional)

b)Continuously Contribute (i.e. give your advice away for free, help someone that could do with your expertise or point them in the right direction where they could find the help)

c)Grab a hold of your opportunities (you will find that if you are known and help others more opportunities will come your way)

If you want any more help or advice with regards to getting the most out of your personal brand, feel free to drop me an email at gerryg@danbro.co.uk

All the best,
Gerry Gregoire
Marketing Consultant at Danbro- the UK’s leading Umbrella Company

Expenses Loop Hole Closed

The Government have decided to crack down on unscrupulous umbrella companies who were using an expenses loop hole to exploit the National Minimum Wage rules. The amendments to the rules will come into force in January 2011 to put a stop to this. Read More…

Umbrella Company Services

Danbro Launches Job Board

Danbro contractor accountant has now gone one step further in providing services for their clients by launching the Danbro job board. The website at Danbro Jobs Board went live today, 23rd August, with the aim of providing Danbro’s contractor clients with a constant stream of new work opportunities.

The Jobs board will enable contractors to upload thier CV, so potential clients can select the most suitable candidate. Furthermore contractors will be able to sign up to our mailing list where they will get weekly updates of the latest temporary job vacancies. This will all be provided as a FREE service for contractors and agencies.

Gerry Gregoire the marketing consultant at Danbro said: “Our clients are number one priority in everything we do. There can be a degree of insecurity for contractors when looking for their next contract, which is why we think this additional service, will assist our clients when searching for the latest job opportunities in the market”.

“The jobs board is linked to a wider network developed by Professional Passport. Since the launch of the Danbro job board we have seen a rapid increase in the amount of agencies listing on it. Don’t miss out; follow the link for more information.

For more information on the Danbro job Board, feel free to contact Gerry Gregoire on 01253 600140 or email gerryg@danbro.co.uk.

For more information contact Danbro on:
Head Office: 01253 600140
London Office: 0207 836 84000
Manchester Office: 0161 238 4918 or visit
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Is your workplace deemed temporary? It could determine whether you have the right to claim travel and subsistence expenses.

Click here to read full article…. Is your workplace deemed temporary?