BBC pays staff through Personal Service Companies

[turbobloke]

eccles said:

I don't know why certain sections of society start foaming at the mouth and go into frenzy whenever the BBC is involved! The news story was about public employees, including the BBC yet they are the ones singled out. What about all the council executives and other public employees?

Are 5-a-Day Outreach Coordinators, Climate Change Managers and binmen Recycling Operatives paid through service companies?

[NoNeed]

Anybody else hoping Coogans name turns up?

[eccles]

turbobloke said:

eccles said:

I don't know why certain sections of society start foaming at the mouth and go into frenzy whenever the BBC is involved! The news story was about public employees, including the BBC yet they are the ones singled out. What about all the council executives and other public employees?

Are 5-a-Day Outreach Coordinators, Climate Change Managers and binmen Recycling Operatives paid through service companies?

What's your point?

[tubbystu]

x5x3 said:

sugerbear said:

RedLeicester said:

Ozzie Osmond said:

The real point here is very simple,

• People at the bottom of our society avoid tax by working for cash etc.
• People at the top of our society avoid tax by the use of service companies.
• The mugs in the middle get nailed for full NI and PAYE.

So a freelance cameraman who might work for the BBC, and a variety of other production houses over the course of a year and earn maybe £20k per annum is oh-so wicked for operating as a company? Oh the shame on them.

Same as whining about "super-rich" movie stars or pop acts, such sweeping statements are utter nonsense and do nothing more than deflect from the truth and inflame the hyperbole.

Rubbish example if the freelancer can pick and choose their job and is only employed for short periods of time at each company.

A better example would be a senior manager who rather than being employed on a permanent basis sets up his own company and then is paid directly to the company. They can then avoid ni contributions by paying themselves a dividend, employ their wife as company secretary and use her tax allowance and offset expenses against their tax bill. They are essentially contracted to a single company for a long period of time on a rolling contract.

I don't know why certain sections of society think that it's perfectly acceptable to evade tax either through doing work cash in hand or muddying the waters between what is a self employed and permanent. Oh wait I do know. Greed.

at the risk of getting back on topic - I deliberately used the word stars in my OP, the debate over usage of PSCs has been done before, what is different this time is that the stars are saying the BBC forced them to do it - but are not being clear if they have made full use of the tax benefits or "done the right thing" and maximised the tax they pay through the PSC.

As part of the Communications Act of 2003 the BBC has to source 25% minimum of its output from independent production companies. As part of the act regional programming quotas were also introduced.

To implement this dramatic change many BBC programmes were moved from in house to external productions, meaning that the recognised faces that presented them had to become self employed and could then work for more than one production company.

David Dimbleby and Question Time is a good example. Mentorn Scotland produce QT, gaining regional production points too - even though it has its office in London, (and is due to relocate to Manchester, under Labours loony scheme).

Of course, if you are a presenter now needing to sell yourself you need an office/secretary to run your diary etc. The cost of such should come from the gross income not the taxed income to avoid effective double-taxation. Any costs incurred in being the presenter can also be charged against the company income and tax should then be properly paid on the genuine presenters income.

This management/office service can of course be provided by the wife/lover/partner/daughter etc without any real problem. This also allows known talent to work on a variety of programmes for multiple employers. This allows newsreaders especially to front other programmes, many of whom are also shareholders/owners of production companies.

This should only apply to front of camera/presentation and some specialist studio production staff, not BBC management or support services though I would not be surprised to find rules being bent.

From the DG down, the genuine BBC staff should be 100% payroll employees and not paid gross. They are only public servants - just like the dustman.

[turbobloke]

eccles said:

turbobloke said:

eccles said:

I don't know why certain sections of society start foaming at the mouth and go into frenzy whenever the BBC is involved! The news story was about public employees, including the BBC yet they are the ones singled out. What about all the council executives and other public employees?

Are 5-a-Day Outreach Coordinators, Climate Change Managers and binmen Recycling Operatives paid through service companies?

What's your point?

People paid by the BBC are routinely fed their dues via a service company while binmen are not. Also by putting their toes in a neat row along the line of Labour and LibDem whine merchants complaining about lawful tax avoidance, as used by high-earners, high earners at the beeb are more than a tad hypocritical - most of which has already been said.

[eccles]

turbobloke said:

eccles said:

turbobloke said:

eccles said:

I don't know why certain sections of society start foaming at the mouth and go into frenzy whenever the BBC is involved! The news story was about public employees, including the BBC yet they are the ones singled out. What about all the council executives and other public employees?

Are 5-a-Day Outreach Coordinators, Climate Change Managers and binmen Recycling Operatives paid through service companies?

What's your point?

People paid by the BBC are routinely fed their dues via a service company while binmen are not. Also by putting their toes in a neat row along the line of Labour and LibDem whine merchants complaining about lawful tax avoidance, as used by high-earners, high earners at the beeb are more than a tad hypocritical - most of which has already been said.

I see you are painting with your very wide tory brush again.

There are many at the BBC who are on PAYE. Do you really think the cleaners, secretaries etc (the same level as your binmen) are paid through service companies?

[turbobloke]

eccles said:

turbobloke said:

eccles said:

turbobloke said:

eccles said:

I don't know why certain sections of society start foaming at the mouth and go into frenzy whenever the BBC is involved! The news story was about public employees, including the BBC yet they are the ones singled out. What about all the council executives and other public employees?

Are 5-a-Day Outreach Coordinators, Climate Change Managers and binmen Recycling Operatives paid through service companies?

What's your point?

People paid by the BBC are routinely fed their dues via a service company while binmen are not. Also by putting their toes in a neat row along the line of Labour and LibDem whine merchants complaining about lawful tax avoidance, as used by high-earners, high earners at the beeb are more than a tad hypocritical - most of which has already been said.

I see you are painting with your very wide tory brush again.

There are many at the BBC who are on PAYE. Do you really think the cleaners, secretaries etc (the same level as your binmen) are paid through service companies?

I see you are paint stripping again with your very wide assumptions brush and spent fluids. Did I miss something in my own post claiming there were no PAYE staffers at the beeb...better take a look back...no, nothing at all. Before your odd question I had already pointed out that few council employees use service companies, your reptition was, well, repetitive and pointless.

I don't recall councils airing their left wing agenda directly into the nation's homes, whining on about behaviour they have adopted themselves.

Still, what can you expect from a corporation (BBC) that ties up its staff pension fund in fairytales.

[markcoznottz]

Most big names who work for the bbc don't do work for rival stations, so they are in conflict with ir35. They are bbc employees in all but tax arrangements. If they travel to the bbc, have done for years, etc then obviously it's a piss take. What happened to Paxo and co's final salary when they went self employed?

[gazza285]

So it's either PAYE and National Insurance, or Corporation Tax on profits and Income tax on the dividend. This is similar to what we used to have in the construction industry with the 714 and SC60 schemes, both now long gone to prevent these shenanigans. If this type of thing can be managed in one of the largest contract employment sectors why can not it be managed in a similar way elsewhere?

[smegmore]

Could someone please explain the difference between AVOIDANCE and EVASION?

Please?

Again?

[anonymous-user]

smegmore said:

Could someone please explain the difference between AVOIDANCE and EVASION?

Please?

Again?

Isn't Avoidance where a small time Joe does what he can to pay as little tax and its OK but sometimes people take the piss and pay a few K a year less than they should get caught and nailed to the wall

And Evasion is where a huge company or very rich persons tries to pay as lite tax as they can get away with and often pay millions less and is illegal but nothing ever happens about it?

[smegmore]

anonymous said:

[redacted]

Sounds about right.

[98elise]

Ozzie Osmond said:

The real point here is very simple,

• People at the bottom of our society avoid tax by working for cash etc.
• People at the top of our society avoid tax by the use of service companies.
• The mugs in the middle get nailed for full NI and PAYE.

The "mugs in the middle" are not forced to be employee's, they can freelance at any time. Then of course you would have the added benefits of....

No paid holiday
No paid bank holidays
No sick pay
No pension
No bonuses
No death in service benefits
No career
No prospects of promotion
No redundancy payments
Short notice (typically a week)
3 months of job security
Loose your job once or twice per year
Do your own books
Insure your self
Sort out your own tax

Most "mugs" prefer to be PAYE.

I started contracting about a year ago, and I get paid more, the government gets more tax, the companies I work for get the flexibility they want. Everyone is happy (or should be!). People moan that we pay less tax as a %, but why thats just good tax planning, in a system thats set up by government, and freely available for anyone to enter.

[telecat]

I and many in IT have or do work this way. Not because we always want to but because the EMPLOYERS don't want you on their books. The fact that HMRC allow it says it all really. It's a good way to maximise your earnings when your maximum earning period is relatively short. Hence you will have the money and still be paying some tax or other on it for years after.

I now work in the Public sector and you get criticised for that nowadays as well.

The Hypocrisy is when those who use or have to use this method of payment criticise others who do. Then claim it's tax AVOIDANCE. Well as far as I can see EVERYBODY avoids paying tax when they can.

Edited by telecat on Saturday 6th October 10:12

[ITP]

Unless anyone knows what any of these presenters previous salary was and their new, I presume, hourly rate is how can anyone know if said presenter is better or worse off for this change?

They may have what appears to be a higher gross income but if they have been at the bbc for many years already they won't be able to claim much in exes to reduce their tax burden. So they may be paying a smaller percentage of a higher gross which may be not much different for the taxman.

Sometimes 'staff' can get all wound up about contractors appearing to be on vastly higher wages than them for similar jobs, but forgetting the sick pay/ holiday pay, job security etc., what tends to happen is contract staff more often than not, especially younger ones, will often appear to be much better off because instead of putting aside enough into a private pension to match a staff one they will spend the money on cars/holidays/gadgets etc giving an impression of being 'loaded' and thus creating resentment.
Sometimes everything is not what it seems on the surface. Plus, many companies now can't afford to carry large staff numbers and need to be able to man up/down as the workload changes, it reduces the overhead and helps win work in the first place. Without this flexibility many companies would go under and the compliaining staff would be out of work, no doubt then looking for a contract job.......

[bennyboydurham]

98elise said:

The "mugs in the middle" are not forced to be employee's, they can freelance at any time. Then of course you would have the added benefits of....

No paid holiday
No paid bank holidays
No sick pay
No pension
No bonuses
No death in service benefits
No career
No prospects of promotion
No redundancy payments
Short notice (typically a week)
3 months of job security
Loose your job once or twice per year
Do your own books
Insure your self
Sort out your own tax

Most "mugs" prefer to be PAYE.

I started contracting about a year ago, and I get paid more, the government gets more tax, the companies I work for get the flexibility they want. Everyone is happy (or should be!). People moan that we pay less tax as a %, but why thats just good tax planning, in a system thats set up by government, and freely available for anyone to enter.

Amen to that. Being paid gross might seem nice from a tax standpoint but the abuses it grants to your employer, ahem 'company' are shocking. Face doesn't fit this week? Bye bye. Off ill for two weeks? Fired. Holidays? Come back to find someone else in your job.

I've been a contractor for years and thoroughly hate all the above.

[98elise]

bennyboydurham said:

98elise said:

The "mugs in the middle" are not forced to be employee's, they can freelance at any time. Then of course you would have the added benefits of....

No paid holiday
No paid bank holidays
No sick pay
No pension
No bonuses
No death in service benefits
No career
No prospects of promotion
No redundancy payments
Short notice (typically a week)
3 months of job security
Loose your job once or twice per year
Do your own books
Insure your self
Sort out your own tax

Most "mugs" prefer to be PAYE.

I started contracting about a year ago, and I get paid more, the government gets more tax, the companies I work for get the flexibility they want. Everyone is happy (or should be!). People moan that we pay less tax as a %, but why thats just good tax planning, in a system thats set up by government, and freely available for anyone to enter.

Amen to that. Being paid gross might seem nice from a tax standpoint but the abuses it grants to your employer, ahem 'company' are shocking. Face doesn't fit this week? Bye bye. Off ill for two weeks? Fired. Holidays? Come back to find someone else in your job.

I've been a contractor for years and thoroughly hate all the above.

I don't hate it, all the benefits I used to get, I now get as cash. I now make my own choices on pension etc. I've never been interested in a career, and I'm not bothereed by the uncertainty.

My current project had 4 contractors. One was let go mid contract (they ran out of work), one was not renewed. Of the two of us remaining the other was only renewed in his last week, and now they might let him go anyway. I'm here until mid december, and am unlikely to be renewed (end of project)

While I've been here they re-advertised my job at a lower rate (without having the decency to tell me first), then when they couldn't get someone, they had to panic and renew me (I already had a new offer on the table from another company). Can you imagine that happening to an employee

Its not the easy ride most permies think it is, but on balance it suits me which is why I do it. I do wonder why other people get bothered by it when the same opportunities are open to them.

I can see why its an issue when someone is effectively in a full time position, with little danger of the contact ending. Especially when its a senior position.

[0000]

98elise said:

Its not the easy ride most permies think it is, but on balance it suits me which is why I do it. I do wonder why other people get bothered by it when the same opportunities are open to them.

Some people can take on the risk because they're good at their jobs.

Some people choose not to take on the risk because they prefer the stability.

Other people want the stability and increased pay (and tax) but haven't got the skills and knowledge to balance the risk, so they piss and moan that the tax structure's different as though that's unfair. We can change the tax structure as many times as they like but they still won't be paid as much.