Welcome to the first, of what we hope will be a regular newsletter highlighting issues which we think are important to you. And to start with, we can’t think of a more important issue than your pay.
This April there will be changes on what you will be able to claim back as expenses as a temporary or supply teacher. Many of you will be using umbrella companies to help you manage these expenses. Currently you are able to offset the cost of your travel from home to school and back against tax. In addition you may be able to claim subsistence allowances against tax.
The umbrella companies will be charging you a fee for this. Their fee should currently be less than then the tax you save, so they make some money, and you save some tax.
From April this will no longer be the case: if you are under the supervision or control of the school then you will no longer be able to claim back travel or subsistence against tax.
The Prime Minister and Chancellor share your concerns.
At Education Professionals we have been dealing with many umbrella companies for many years, and for several months now we have been waiting for news on how Umbrella Companies are going to react.
In fact we are still waiting: We have not yet heard any definitive plans from any of the Umbrella Companies on how they will react. Most will be offering some form of vouchers or loyalty schemes against supermarket shops or for High Street Stores.
Our concern is that Umbrella companies will continue to deduct their expenses from your pay, but in return you will not be seeing the benefits. Put simply, if 4% or 5% of your pay is going to an Umbrella Company we would recommend that you make sure that you are saving 4% or 5% somewhere else.
We will keep our ears to the ground if we hear of any updates, but in the meantime we recommend that if you do use an umbrella company you
Check your current payslip to confirm how much is being deducted
Find out what plans your umbrella company has in place from April onwards
Find out how much you will be worse off. Now might be the time to start asking about a rise or going PAYE.
Whatever happens someone is going to take a hit, be it the schools with higher charge rates, teachers with reduced pay or the payroll companies.
Whatever happens I hope you have a prosperous and fully employed New Year!