Agency PAYE vs umbrella company: Which is best for me?

When it comes to contracting, there are a number of ways you can operate as an independent worker. Although the most popular choices are undoubtedly through your own limited company or an umbrella company, there is also the option to work via an agency PAYE.

This basically means you will work through a particular agency as a part of their payroll – but only if they provide you with this option. If they do not then it’s either and umbrella company or a limited company.

Like an umbrella company, operating through an agency PAYE removes a considerable amount of hassle from your contracting life, but what are the main differences between the two?

Rates of pay

Generally, you’ll get a higher rate of pay working through an umbrella company than you would if chose to take a contract through an agency.

Expenses

If you choose to work through an agency you will forfeit your ability to offset legitimate business expenses against your income. As an umbrella company employee you may be able to claim business expenses against your earnings, offering you more flexibility in this area.

Claiming expenses is part and parcel for a contractor and so it may be wise to consider the option which enables you to do this.

Before you decide on an umbrella company it is always wise to see what they can offer you in terms of expenses and their specific policies relating to this.

NICs and tax

Essentially, this works out the same whether you work through an agency PAYE or an umbrella company. In both instances, National Insurance Contributions (NICs) and tax are deducted at source and so there are no additional costs of charges.

When it comes to payroll calculations, both options will take care of this for you, leaving you more time to focus on your work or obtaining a better work/life balance.

Invoices

The same applies as the above for invoices. In both cases your invoices should be raised and sent to the client on your behalf, removing the need for you to chase up the client once the invoice has been sent over to them.

Contractor insurance

Any good umbrella company will offer you a full insurance package which not only looks after your interests but also your client’s in the event of an accident where their property is left damaged.

Not only does this ensure that you are covered in the event of a problem onsite, it also means you don’t have to spend time looking for the right policies to cover yourself as it’s all done for you.

So which is best for me?

Overall, it is generally more beneficial for a contractor to use an umbrella company as opposed to an agency PAYE. While both remove a significant amount of hassle in terms of paper work, tax calculations and insurance procedures, the financial positives are far better with an umbrella company.

Higher rates of pay and the ability offset expenses against your income are two of the main reasons why most contractors take the umbrella route over agency PAYE.

Appearances mean everything

First impressions can be lasting, not just when meeting people, but also when seeing a building. When parents come to a school on open days when deciding where to send their child it is important the building and its surrounding areas are pristine.

Sometimes, these initial opinions can help a parent make their decision. They want to make sure their youngster goes to an educational establishments that not only provides a first-class education, but also takes pride in its appearance.

Every area of the school should be presentable at all times, so visitors are impressed as soon as they enter the grounds.

Car park

As soon as a parent enters the car park they will be judging the school, which means even this area needs to be taken care of.

Make sure there is no litter either in or surrounding the area where visitors will leave their vehicles. The school should regularly repaint the road markings on the tarmac, as faded lines can make the car park look scruffy.

In addition, the outside of the building should be well-maintained. The windows should be clean and any graffiti or grime should be washed off routinely.

Entrance

Any entrances to the school should be manicured and well-maintained to lay the foundations of a positive and lasting impression.

Any tatty notices or aged examples of student work should be removed and replaced with laminated alternatives, so they last longer and can be wiped if they become a bit grubby over time.

If the school has won any awards, or has received a high score from Ofsted then these should be displayed here to immediately catch parents and visitors’ attention.

Hallways

All notices that line the hallways should be neat and tidy and should be replaced if they have suffered damage or vandalism. These walls also provide perfect places to display student work to give the parent an idea about what their child might learn at the school.

The floors should be pristine, which is a job a contract cleaner could do on a regular basis to make sure they shine.

Assembly hall

On school open days, staff and parents will more than likely congregate in the assembly hall at some point. This means this area in particular should be clean, tidy and welcoming.

All the chairs and tables used should be in good repair, free of graffiti and all hidden chewing gum should be removed beforehand. A quick way to do this is to use drizzle some oil – vegetable or olive – on the offending globs, leave for five minutes and then scrape off with a spatula.

Any drapes or curtains should be clean and smell fresh, as a musty odour can be very off-putting, especially if you’re sat close. The floor should be immaculate and should have an impressive shine.

It is important to remember that parents are there to decide whether or not the school is good enough for their child, so it is vital the building is as aesthetically pleasing as the curriculum is attractive.

Why financial service firms need to embrace the tech revolution

With the global economy more interconnected than ever, the impact this is having on the financial services sector has been profound. Whether it is consumer banking, wealth management funds or international insurance firms, the need for these companies to operate quickly and reliably across borders has never been greater.

As a result, the technology solutions used by this sector has seen a huge jump in complexity in recent years. Since the financial crisis, companies are now required to keep much closer control of their records than in the past in order to meet strict new regulatory requirements. At the same time, new ways of doing business such as the mobile revolution and the greater availability of data means fast, reliable networking is a must.

Therefore, it’s no surprise that investment in technology in the financial services sector is on the rise. Figures from International Data Corporation predict overall IT spending in this industry is set to top $430 billion in 2014.

Reducing the risk

Of this, nearly a fifth will go towards solutions to assist with risk management operations, which is a top priority for financial services firms this year. And with good reason, as regulators around the world now impose much tighter controls on this industry, for everything from doing business with corrupt officials to irresponsible trading.

When it comes to monitoring transactions for potential corruption, for instance, there are several technology solutions that will need to come into play – all of which must be interconnected to stand a chance of success. Know your customer tools will have to be able to access the latest data – both internal and external – about who institutions are doing business with. These need to work alongside tools like big data solutions and databases that analyse and approve millions of transactions a day, looking for any unusual activity.

Putting the customer first

Offering customers the highest possible level of services will also be a priority for the industry that technology solutions stand well-placed to assist with. This is true whether an institution is offering everyday banking services for individual consumers or dealing with high-end wealth management clients.

It was recently noted by CNBC that “wealth-management firms will have to provide more services and adopt a more collaborative relationship with clients as automated websites and mobile trading provide self-directed investors with the tools to manage their own investments”.

This level of automation and collaboration will put large demands on traditional banking technology systems. Instead, firms will need to look at advanced, more reliable systems that are able to provide users with the ability to manage finances from wherever they are, in a way that suits them.

Similarly, in the consumer banking sector, the need for mobile tools to interact with each other and provide a consistent level of service will also be paramount. It was recently noted by Gartner that some institutions will end up having 20 or more apps available to users  – which will lead to a quarter of leading banks looking to offer dedicated app stores for customers in order to organise these offerings.

These will not be able to work as effectively as possible in isolation, so interoperability will be a must. To find out more about how this can be achieved, visit www.intersystemspartner.co.uk.

Top Tips for Personal Finance

These days, in our world of credit cards, mortgages and the loom of crushing debt, it’s so important to know how to manage personal finance so we don’t get caught up in that trap. But we often hear different advice from so many different people, each with different and often conflicting ideas on how we should manage our personal finances. The truth is, smart finance tips aren’t hard to follow. Read on to learn those personal finance tips that we recommend the most:

Get a fixed rate home loan

For many people, home mortgages are a financial crutch which prevents them from living with financial freedom. Home loans can incur skyrocketing interest rates, and if you’re not careful these can completely decimate your savings. So when you’re signing up for a mortgage, make sure that you’re signing a fixed rate home loan. Fixed rate home loans allow you to budget more effectively, because you won’t be shocked from rising rates.

Set a weekly budget for groceries

You might be surprised, but grocery shopping can be one of the highest expenditures in many homes. It might not seem like much when you go out to stock up on Sunday night, but those mini trips throughout the week to pick up a few ingredients, combined with those unnecessary extras thrown in to keep the kids from whining, can really add up. So set yourself a budget to stick with, that you know will allow you to enjoy the other areas of your life.

See where you can cut back

Maintaining good personal finance doesn’t mean that you’re stingy with yourself or your family. It simply means that you recognize the difference between what’s necessary, what’s enjoyable and what you really don’t need. If you find yourself buying a few expensive lattes per day, try to cut one out. Other habits you might not notice at first can end up costing you over the long term, so see where you can cut back without reducing your quality of life too much.

Teach your kids about personal finance

If you can teach your kids the skills they’ll need to learn later in life, this will pay off greatly in the long run. This could mean the difference between self-sustaining grown children, and those who still need handouts late into their 20’s. Give your kids a modest allowance and teach them the ways that they can earn money around the house. Let them know that once their budget is spent, they need to find ways to earn more rather than just getting money handed out to them.

Top Tips for a Healthy Heart

You probably already know that a healthy heart is essential for a healthy life. It’s the organ that pumps life force through your body, so taking the time and care to ensure it’s working properly can add years onto your life! But unfortunately, many habits in life today can compromise heart health. So read on to learn how you can take control and make your heart healthy with some simple lifestyle changes!

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Improve your diet

Did you know that changing your diet even just a bit can really improve the health of your heart? First of all, minimize trans fats as much as possible, which are found in fast food and processed foods. Replace them with healthy mono- and polyunsaturated fats like those found in fish, nuts, seeds and olive oil. Just a small handful of walnuts after lunch and dinner can create a significant improvement in your heart health.

De-stress

Stress is unfortunately one of the biggest contributors to heart disease today. With the constant barrage of news, media and obligations in our lives, it’s easy to get overstressed and the heart can suffer from it. So create some space in your life to unplug from social media and the news. Dedicate an hour per day to time for yourself, reading and meditating, or whatever it is that chills you out.

Check your heart

It’s hard to know how much you need to improve your heart health, if you’re not even sure where you stand. That’s why it’s important to take a heart health test so you know how you’re doing. We recommend the HBF Healthy Heart Check because it’s a simple test that lets you know how you’re doing, and can help you identify areas in your life that you can improve to increase your heart health.

Quit smoking

Smoking is another major risk factor for heart disease and other heart problems. So if you’re a smoker, it is imperative that you find a way to quit, if you want to reduce this risk in your life. And if you live with smokers or are exposed to smoke regularly, find a way to change your lifestyle to remove this risk.

Strength Train

You might think that cardio exercise is the best way to keep your heart in good shape, but it’s strength training that will really beef up its health factor. Yes, cardio training is helpful but when you strength train, you reduce your body fat percentage while increasing muscle mass and endurance, all of which contributes to a healthy heart.

Should I lease, rent or finance my car for business  

A Mini, that’s what the business needed. Something that could glide through traffic; a car that could get from one point to the other, quickly, fuel efficiently, and in style.

The business didn’t need a White Van. It was really just for running documents and travelling to client meets. There was only one dilemma in my mind: “Should I lease, rent or finance the car for my business?”

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I wanted to make the right choice, so I needed to conduct a little research and find out what the best option was. Now, a year later, I’ve found that I made the right choice, but each business is different, so you’ll want to analyse all of the following options before you commit.

Car Rental

Let’s say that you, as I once did, decide to rent a Mini Classic. You’ll soon realise that while this arrangement works very well for a day or two, it is not normally a good long term arrangement. Car rental companies force you into ‘their’ contracts; they required that I bought additional Mini Classic car insurance (for the Mini that I was renting). Even though I already had car insurance that would cover any accident, their contract meant that if I didn’t take their offered insurance I would have had to foot the bill for “Loss of use”. This meant that in the event of an accident I would have had to pay a fee for the time the car was being repaired (loss of work use for that rental). Needless to say, these fees were not cheap.

Of course there are also other ‘miscellaneous’ costs associated with a rental. In other words, you never end up paying that low headline fee advertised in the paper and so car rentals are rarely a long term business solution. If, however, you need a short term option, they may be the right choice for you

Leasing

Car leasing is becoming more and more popular in the business world. This is certainly an option to consider, as there are more than a few benefits to obtaining a business car using this model.

  1. Offers a fixed leasing contract, for a period that generally ranges from 2 to 5 years.
  2. This option also includes certain maintenance benefits; you don’t have to pay additional costs for maintenance servicing, tyres and other items when you purchase a ‘fully-maintained” lease option.
  3. Lease payments are fixed for the term of the lease. This makes it easier for you to budget business expenses.
  4. Leasing can eliminate many of the risks associated with owning a vehicle. The only additional item you’ll need to pay for is car insurance.
  5. If you are registered for VAT you can claim a proportion of the finance rental when you file.

There are a couple of negative points to the option of leasing however, and you’ll want to consider these before making a final decision. Lease contracts tend to be inflexible, so if you want to return the car before the contract is up, you’ll have to pay an early termination fee. There may also be costs incurred at the end of a lease, depending on the contract you opt for.

Why Buy?

As a person who has both bought and leased business vehicles, I can tell you that there are a lot of advantages to buying. Two of the key benefits to buying a business vehicle are as follows.

  1. You own the car and as a result it is deemed an asset. You have the right to sell the business vehicle at any time, as long as you are not restricted by finance agreements.
  2. Unlike a lease, a car that you buy can do as much or as little mileage as you require. Often leases will restrict you to a certain annual mileage.

The main drawback to buying is of course that you do need to offer a large up-front payment, whereas you don’t in a leasing agreement. You also bear the costs associated with the depreciation of the vehicle.

Final Thoughts

Both leasing and buying are good options. If you want predictable expenses, and easy maintenance, then the fixed costs associated with leasing may offer the best solution. If you are cash rich then buying can offer you more flexibility.

Enjoy the golden years: save money on your retirement  

The journey to retirement begins with the first day of work and, while saving for retirement should be the primary focus, preparing to spend that nest egg wisely is also important.  Today, retirement covers a longer period of time than ever before – thirty years or more for some people – so ensuring that the money is going to stretch and serve well is a priority.

 

Good money habits during retirement

 

One of the top ways to save money during retirement can begin long before actually retiring.  Having bad habits with money can have an immediate effect as well as a long-term effect on finances, but establishing good habits and patterns can have a very positive effect very quickly and, once established, will be easy to maintain when retired.  Make it a habit to work out a monthly budget, as well as planning for yearly expenses, and stick to it as closely as possible.  Explore available discount programs and cards, particularly when eligible for senior discounts.

 

Choosing a retirement community

 

Though some retirees will have enough saved to maintain their own home or travel the world, living in a senior community is the best long-term option for many.  Senior communities, in particular independent living communities and Continuing Care Retirement Communities (CCRCs), offer a wide variety of services and amenities in addition to the peace of mind that an all-inclusive living environment provides.  With utilities and maintenance taken care of by the facility, residents are free to enjoy activities out and about, or simply sit in and relax.  A senior community lifestyle can be a money-saving option, keeping most living expenses at a constant unlike the fluctuations that occur when maintaining a home and car and living independently outside a community.

 

One important criterion to be considered when choosing a senior community is the quality of health care offered by the facility.  Health care is one of the largest expenses incurred during the retirement years and, as more and more retirees live into their 80s and 90s, the prospect of needing continuing care becomes ever more likely.  Senior communities offer a variety of different health care programs and options for residents, customizing care to suit their individual needs.  From personal care to memory care for those suffering from Alzheimer’s to respite and hospice care, senior communities provide quality care with professional medical staff that will help a resident retiree save money.

 

Planning a worry-free retirement

 

Though worries may arise during the years leading up to retirement, from concerns over whether there will be enough money to retire to worrying whether there will be enough money to get through retirement, one thing is certain: the retirement years should enjoyed!  After a lifetime of work, retirement should be a time of unique opportunities and fun.  Living in the ideal senior community can be a major part of that worry-free and enjoyable retirement.

 

All the clever investment strategies and plans cannot ensure a worry-free retirement, but fostering good habits with money early on, as well as exploring retirement community living as a real option, can help stretch those dollars throughout retirement.

 

 

Five Ways your Business Start Up Can Save Money Today

The first couple of years for a start-up can be amongst the most difficult, building up an audience and battling to remain in existence. Having a frugal and financially-responsible business model and implementing cost-effective ethics are hugely important at this stage. Here are five ways in which a start-up can save money without compromising the quality of the services and/or products.

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Never Miss an Advertising Opportunity

Many newer and smaller businesses bemoan a lack of funding to implement an advertising campaign, citing the expensive costs of television and radio airtime. However, everyday business endeavours are in themselves packed with advertising opportunities. All business mailings can include advertising materials, promotions and unique offers. Piggybacking your advertising can help cut costs directly appeals to your market demographic according to J. Donald Weinrauch, co-author of The Frugal Marketer.

Take Advantage of Skilled Freelancers

If your start-up requires a number of different skills, you may feel pressured into undertaking a lot of unfamiliar tasks or expanding your workforce. Both of these options can be problematic – either stretching yourself beyond your skillset or taking on too many costs. The internet is jam-packed with talented freelancers with a range of skills and abilities at great prices. People Per Hour is a fantastic service with a great range of talented individuals with skills as diverse as photography and web development. One-off jobs can be completed at a cut price by an individual with the correct skills.

Cut Down on Delivery

More and more commerce companies are starting up on the internet rather than out of a bricks and mortar site, due to the money-saving potential of inhabiting virtual space rather than physical space. This however can lead to high levels of delivery costs. Make sure you keep your services competitively-priced, by cutting down on delivery costs. All courier services charge different amounts for different services, so use a company such as Rapid Parcel or Parcel2Go to ensure you are always getting the best rate available for your delivery needs.

Take Advantage of Government Schemes

Keep abreast of government schemes for local businesses to make your money go further. Tax breaks are available for small business in a bid to improve the strength of the country’s economy as well as other benefits. Apprenticeship schemes have grown in scope and popularity in recent years with added incentives offered to companies employing apprentices. Employers may be entitled to a £1,500 apprenticeship grant as a part of the government’s scheme, making it more affordable to expand the workforce.

Utilise Free Software

Where possible, take advantage of free software. Services such as Skype are just as effective in the workplace as at home, allowing you to make free business calls to clients, customers and colleagues. The instant chat feature also allows you to stay in quick and constant contact with your colleagues during the workday, and transfer important files. Additionally, Dropbox is a free (for the starters’ package) online storage service, ensuring you have access to all your important documents at all time.

Entrepreneur retirement: taking charge of your future  

Owning a small business has always been appealing to people because it offers the individual owner a degree of personal independence and the freedom to direct their business as it grows. The feeling of creating a successful business that leaves a mark simply cannot be measured. With this freedom, however, comes unique responsibilities, as entrepreneurs will find themselves taking responsibility for their own finances in a way that non-business owners do not need to, namely properly planning out their retirement finances.

 

Planning for your retirement when self-employed

Planning inadequately for retirement is a major mistake that many entrepreneurs make. Regardless of the age of the business owner, fears about finances both current and future may severely hamper any savings plan. This could lead to a business owner finding themselves in a predicament when the time comes to retire, either finding themselves short of funds and forced to supplement their meager savings or deferring retirement indefinitely in order to continue producing income.

Successful retirement plans should begin with the start-up of the business and be factored in along the way. For a self-employed business owner, considering options for saving and finding the best route means doing some homework. There are a variety of routes that one can take to save for retirement, many of which are very generous in their tax-saving features.

Begin by learning as much as possible about investment and finance, particularly as it pertains to retirement savings. The current instability in the economy means that a certain degree of flexibility may be needed. In addition, seek out advice and guidance from reliable sources such as the Gallagher Group; more complete knowledge equals better investments equals a better retirement in the long run.

Beginning early to save for retirement is important for two reasons: first, a longer span of time before retirement means a longer period of time in which to be saving money; second, a longer span of time allows for changes to be made to the structure of the retirement investments, depending on the success of the business as well as the economy and stock market.

When it comes to investing, there are a wide range of choices to explore. Remember to spread the savings around, diversifying into stocks, funds, real estate, as well as investing in the business itself. Establish a yearly contribution goal, at least 10% of the net yearly income, to be saved. Individual business owners without employees may want to explore the SEP-IRA. This type of IRA is a simplified employee pension, and the investor may contribute up to 15% of their yearly self-employment income. Another option is the Solo 401(k), which allows for sizable contributions up to $50,000 per year for a business owner and spouse.

 

Taking charge of your retirement

While it may seem intimidating to begin saving while the economy is still experiencing the recession hangover, it is actually the best of times to start building a retirement nest egg. With thorough research and sound advice, any entrepreneur can wisely and confidently invest for their future in a wide variety of ways, putting the gold in their golden years as they watch their own business grow.

 

Buying second-hand cars

Are you considering buying a car but you’re afraid it will cost you a fortune?

Some days ago we talked about the benefits and drawbacks of both buying and leasing. We now present an option that stands right in between of these two: buying used cars. Don’t think that the expression “used car” implies an old broken car that will last you no longer than one year. This idea is completely out of date. Nowadays there’s fortunately a big amount of second-hand vehicles that have been well taken care of and stand in extremely good conditions.

Online second-hand market

Thanks to the internet, buying and selling have become so much easier. The evolution from the local to the global market is something we should take advantage of. There are thousands of websites all around the world where you can find great offers of second-hand cars. Check for example the used cars for sale in India, the second most populated country in the world has an expanding second-hand market which is growing around a 15% every year.

Benefits and drawbacks of used cars

But what are exactly the benefits of buying a second-hand car instead of a new one? Well, the main benefit of course is the price. Only by coming out of the car leadership, the car’s price experiences a fall of 20% and most of them lose up to a 40% of their original price during the first year. If you have a limited budget, this more affordable price will allow you to choose among cars of higher quality.

However, when purchasing second-hand cars, we obviously take a higher risk than when buying a brand new vehicle. It’s important to always revise every single aspect, such as mileage, accessories, hoods and motor. But it’s even more important to check that the car papers are in order. If you take care of these aspects, you can really get a good deal and find the car that suits your necessities as well as your financial means.