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Redego Group Pension scheme: Reducing Tax & NI

Posted 02-07-2010 by Ifan

Find out more about “salary exchange”.

Redego clients can significantly reduce the deductions made by the taxman using what is known as a ‘salary exchange’ arrangement. Payroll can transfer funds from your gross contract into the new Redego Group Pension scheme and the taxman won’t receive a penny of this money.

These transfers to the pension scheme represent a key way to ensure that you work as tax efficiently as possible through Redego.

There are no set up costs whatsoever to join the pension and because you reduce not only income tax but also employers and employees National Insurance as well, the Redego scheme is far more effective than any existing arrangements that you may have access to. The rate of deductions saved, even for basic rate taxpayers, is 38% and can be as high as 68% for those who pay the highest rate of income tax.

Joining the scheme couldn’t be easier via telephone, post or email and you can stop contributions at any time without penalties. Should you eventually leave Redego, your fund can either be left invested or you can continue to add to it via a personal investment or via a new employer. Alternatively it can be transferred out to another pension scheme.

In order to bring you this fantastic tax saving opportunity, we are working closely with ContractorFinancials who are Independent Financial Advisers with a unique understanding of the way that you work as a Freelancer. They aim to ensure that you have the knowledge to make the most of your current employment status, helping you to maximise any available tax breaks and avoid any potential pitfalls that you may face.

Pension specialist Andrew Gains explains

“As well as the substantial tax savings to be gained by diverting part of your invoice into the Redego scheme, pension funds held elsewhere can be consolidated within this single scheme and could enjoy potentially far better performance and lower running costs. As independent advisers we can compare schemes for you and we ensure that the new pension scheme provider will levy no charges for accepting such transfers”

Contact Andrew Gains today on 0845 062 8888 or email redego@contractorfinancials.com for further details.

Avoid the 1% National Insurance hike in April with the Redego pension scheme

Posted 08-04-2010 by Ifan

As part of our mission to help contractor’s work as tax efficiently as possible, here we look at how Redego clients can avoid the National Insurance (NI) increase that is due in April whilst, at the same time, saving for retirement.

Unlike a permanent employee, many Contractors pay both employer’s and employee’s National Insurance on earnings.  This means that the 1% hike expected in April will have a noticeable effect on a Contractor’s take home pay.

The good news is that the Redego Pension Scheme provides a great opportunity to reduce a contractor’s total tax deductions.

By transferring a portion of your income into the personal pension scheme a basic rate tax payer saves upto 39%. Higher rate tax payers can save between 49% and 69%.

This ‘Salary sacrifice’ can counteract the 1% increase by reducing the Income Tax and NI normally paid on earnings.

Why Choose Redego’s Pension Scheme?

Redego works with IFA ContractorFinancials to provide a pension scheme with as much flexibility as possible, allowing contractors to change contributions to match a their contract’s earnings at any time. There is total freedom to decide how much is transferred and contractors can pause contributions at any time.

If a contractor decides to leave iBalance then the pension can either be left to grow, or closed completely with funds moved elsewhere.

The legislation surrounding annual allowances for pension tax relief are changing in April and the new allowance will be £50,000 (down from its current level of £255k).  However, this still offers significant scope for most investors.

Independent Advice Without Pressure

There are no set up costs when joining the Redego group personal pension scheme and the pension advisers at ContractorFinancials are independent of any one company. This allows Redego contractors to take advantage of a full review of any existing pensions in place.  Then, if it makes sense to do so, the advisers will assist in transferring any existing funds over to the Redego pension.

To speak to a pension adviser about the Redego group personal pension or for more information on the scheme, call 0845 062 8888 or email Redego@contractorfinancials.com and an experienced pension adviser will be in touch.

Scale Rate expenses & dispensations

Posted 01-04-2010 by Ifan

HM Revenue & Customs (HMRC) and HM Treasury’s joint consultation to review tax relief on travel expenses paid to workers by agencies and umbrella companies is now taking effect.

They were concerned by the mis-use of dispensations and scale-rate allowances and were considering new legislation. However, in their Pre-Budget Report, the Treasury confirmed that they would not be changing the rules, but would tighten compliance for umbrella companies abusing dispensations.

Beware of Dispensations and Scale Rates

Many recruitment industry newswires were recently reporting this as ‘good’ news, but for those contractors and agencies using umbrella companies that operate dispensations, the warning was in the small print:

“However, in the light of evidence from the consultation confirming poor levels of compliance in this area HMRC will refocus its efforts to ensure that the current regime is properly applied”

Compliance bandwagon

Undoubtedly, many umbrella companies will now attempt to jump on the bandwagon and drop their ‘No Receipts Required’ offerings, but whether or not they have the compliance culture or technology to deliver remains to be seen.

The Redego ethos
Agencies and contractors seeking peace of mind are focusing on the few umbrella companies that have an ethos of expense compliance.

Redego has always believed that ’scale rates’ in the context of umbrella companies are an anomaly and have never used them in over 10 years of operating payment services.

Using LinkedIn to secure your next contract

Posted 07-03-2010 by Redego

Linkedin has been dubbed ‘Facebook for grown-ups’ and is an online network of more than 8.5 million experienced professionals from around the world representing 130 industries. Its possibilities for job hunting are vast, and a number of Redego’s contractors have secured contracts via this social networking site.
However, for many users, it is a tool that is under-utilised, so I’ve compiled a top-ten list of ways to increase the value of LinkedIn.
1. Increase your visibility.
By adding connections, you increase the likelihood that people will see your profile first when they’re searching for someone to hire or do business with. In addition to appearing at the top of search results (which is a major plus if you’re one of the 52,000 product managers on LinkedIn), people would much rather work with people who their friends know and trust.
2. Improve your connectability.
Most new users put only their current company in their profile. By doing so, they severely limit their ability to connect with people. You should fill out your profile like it’s an executive bio, so include past companies, education, affiliations, and activities.
You can also include a link to your profile as part of an email signature. The added benefit is that the link enables people to see all your credentials, which would be awkward if not downright strange, as an attachment.
3. Improve your Google PageRank.
LinkedIn allows you to make your profile information available for search engines to index. Since LinkedIn profiles receive a fairly high PageRank in Google, this is a good way to influence what people see when they search for you.
To do this, create a public profile and select “Full View.” Also, instead of using the default URL, customize your public profile’s URL to be your actual name. To strengthen the visibility of this page in search engines, use this link in various places on the web> For example, when you comment in a blog, include a link to your profile in your signature.
4. Enhance your search engine results.
In addition to your name, you can also promote your blog or website to search engines like Google and Yahoo! Your LinkedIn profile allows you to publicize websites. There are a few pre-selected categories like “My Website,” “My Company,” etc.
If you select “Other” you can modify the name of the link. If you’re linking to your personal blog, include your name or descriptive terms in the link, and voila! instant search-engine optimization for your site. To make this work, be sure your public profile setting is set to “Full View.”
5. Perform blind, “reverse,” and company reference checks.
LinkedIn’s reference check tool to input a company name and the years the person worked at the company to search for references. Your search will find the people who worked at the company during the same time period. Since references provided by a candidate will generally be glowing, this is a good way to get more balanced data.
Companies will typically check your references before hiring you, but have you ever thought of checking your prospective manager’s references? Most interviewees don’t have the audacity to ask a potential boss for references, but with LinkedIn you have a way to scope her out.
You can also check up on the company itself by finding the person who used to have the job that you’re interviewing for. Do this by searching for job title and company, but be sure to uncheck “Current titles only.” By contacting people who used to hold the position, you can get the inside scoop on the job, manager and growth potential.
By the way, if using LinkedIn in these ways becomes a common practice, we’re apt to see more truthful resumes. There’s nothing more amusing than to find out that the candidate who claims to have caused some huge success was a total bozo who was just along for the ride.
6. Increase the relevancy of your job search.
Use LinkedIn’s advanced search to find people with educational and work experience like yours to see where they work. For example, a programmer would use search keywords such as “Ruby on Rails,” “C++,” “Python,” “Java,” and “evangelist” to find out where other programmers with these skills work.
7. Make your interview go smoother.
You can use LinkedIn to find the people that you’re meeting. Knowing that you went to the same school, plays hockey, or shares acquaintances is a lot better than an awkward silence after, “I’m doing fine, thank you.”
8. Gauge the health of a company.
Perform an advanced search for company name and uncheck the “Current Companies Only” box. This will enable you to scrutinize the rate of turnover and whether key people are abandoning ship. Former employees usually give more candid opinions about a company’s prospects than someone who’s still on board.
9. Gauge the health of an industry.
If you’re thinking of investing or working in a sector, use LinkedIn to find people who worked for competitors—or even better, companies who failed. For example, suppose you wanted to build a next generation online pet store, you’d probably learn a lot from speaking with former Pets.com or WebVan employees.
10. Track startups.
You can see people in your network who are initiating new startups by doing an advanced search for a range of keywords such as “stealth” or “new startup.” Apply the “Sort By” filter to “Degrees away from you” in order to see the people closest to you first.
11. Ask for advice.
LinkedIn’s newest product, LinkedIn Answers , aims to enable this online. The product allows you to broadcast your business-related questions to both your network and the greater LinkedIn network. The premise is that you will get more high-value responses from the people in your network than more open forums.
Redego staff Lewis Grimwood and Jon Boon can both be found via linked in. Add us as contacts so we can feel popular!

Linkedin has been dubbed ‘Facebook for grown-ups’ and is an online network of more than 8.5 million experienced professionals from around the world representing 130 industries. Its possibilities for job hunting are vast, and a number of Redego’s contractors have secured contracts via this social networking site.

Benefit from up to 48% tax relief with Redego

Posted 09-12-2009 by Ifan

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Many Redego contractors are now benefiting from our tax saving Pension Scheme.

Any contributions made to the Pension are completely tax free (PAYE and National Insurance) making it an excellent way to save tax and plan for the future.

Benefits include:

- Gain from up to 48% tax relief at source

- No set-up fees whatsoever and low running costs

- Flexible investment levels, you decide what goes into the scheme each month

- Its fully portable (you are free to continue investing if you leave Redego)

- We can help consolidate any other pensions at no cost

Contact Kate Woodhatch now on 0845 062 8888 to get this up and running and start to save you tax and NI from your very next invoice.

Alternatively you can email Redego@contractorfinancials.com for further details.

Could Brown’s childcare voucher plans cost him?

Posted 11-11-2009 by Redego

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Nine former ministers today rounded on Gordon Brown’s plans to cut childcare, warning the prime minister that he is threatening marginal Labour seats in the runup to the election by axing popular support for hard-working parents.
The warning came from normally loyal former ministers – including Patricia Hewitt, Estelle Morris, Hilary Armstrong, Beverley Hughes and Caroline Flint – who say the plans to cut childcare vouchers for more than 340,000 parents are “greatly unfair” and “mark the undoing of one of Labour’s landmark achievements”.
Brown announced he was removing tax relief for employer-based childcare vouchers, arguing that too much of the money was going to the middle classes. He has outlined plans to switch the money to provide 10 hours of free childcare for 250,000 two-year-olds by 2015. But removing vouchers, which are thought to save parents up to £2,400 a year on the cost of nurseries, nannies or childminders, would strip “effective and popular childcare support from hard-working parents”, the former ministers said.
In their letter to Downing Street, the former ministers, including former women’s minister Meg Munn, urge the government to review the decision: “Carefully considering the full impact of removing the tax relief on parents, employers and the childcare sector.”
“Surely this is not the time for us to remove a key support from hard-working families at the very point we need them at their most engaged and productive to fuel the recovery from recession. Crucially, in the runup to an election, it will remove support for working parents and for businesses in key marginal constituencies.”
More than 70,000 people have signed a petition on the Downing Street website criticising Brown’s decision and urging him to reconsider. Some of the signatories to the letter have likened the revolt to the way the government was caught on the hop over opposition to the abolition of the 10p tax band.
The authors, notably Hewitt, believe the Treasury has mistakenly seen the childcare voucher as a middle-class perk.
The letter said: “Childcare vouchers are an essential support to over 340,000 parents enabling more than 33,000 employers to help their employees, especially women, balance family and work responsibilities. It added: “Withdrawing them will penalise a significant number of lower-rate taxpayers, reduce the overall amount of funding available for childcare, reduce parental choice and impact negatively on the economy as the UK moves towards recovery.”
The vouchers can be used to offset the cost of childcare from Ofsted-registered providers, saving higher-rate taxpayers £1,195 and basic-rate taxpayers £962 a year. Both parents can use the vouchers, potentially saving couples £2,390 a year.
The government maintains that existing beneficiaries of the tax break will not lose out, and that the current scheme is badly targeted by providing too much relief to higher-rate taxpayers.
Downing Street said it would look at the criticisms carefully in advance of the pre-budget report. The critics said the government’s belief that the relief is regressive was based on out-of-date figures, and that the latest surveys suggested 74% of the users of the scheme are basic-rate taxpayers. Other signatories include the former Scotland Office minister David Cairns, former Europe minister Denis MacShane, and the former international development minister Sally Keeble.

Nine former ministers today rounded on Gordon Brown’s plans to cut childcare, warning the prime minister that he is threatening marginal Labour seats in the runup to the election by axing popular support for hard-working parents.