Working out how much to charge in December pro-rata?

R.O.S.S.I

R.O.S.S.I

R.O.S.S.I

Soldato
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I have a peculiar work situation where I am for all intents and purposes still employed by the company I worked for in Australia, so have all of the same rights (sick pay, annual leave, bank holidays, other benefits etc) that I would do as an Aus employee but I am working for them from the UK as a contractor until the UK company is setup. So basically just invoice them as a sole trader every month for an agreed salary and they pay it (all outside of IR35)

Normally i'd just invoice for the same amount each month which equates to a 12th of my yearly salary, however this month instead of using annual leave for the for the days in between Xmas and NY I'm taking them as unpaid leave so was wondering the correct way to work out how much to invoice for.

Am I right in thinking, for December, that it should basically be (monthly salary / total possible working days) * actual days worked?

So as an example if I was on say £80,000 per year the calculation would be something like - (£6,666 / 23 days) * 20 days?

I feel like i'm hugely overthinking it but wouldn't mind a sounding board.
 
I know that was just an example but keep in mind there was only 21 working days in December 2021 (in UK at least).

What makes this complicated is normally as a sole trader, annual leave / unpaid leave would be effectively the same thing when it comes to invoicing the client, just a non-working day. However it sounds like you are not getting paid a day rate but rather some sort of annualised salary with annual leave.

I think your suggestion is reasonable but one caveat is whether there is any expectation on accrual of annual leave. i.e. if you had a lot of unpaid leave in December then arguably you should have your annual leave reduced. Otherwise to take it to extremes, you could take say 200 days unpaid leave and then book off 27 days annual leave and get paid 27 days work for literally doing nothing.
 
I am being treated as an employee still effectively so I will still accrue annual leave in the normal way and get bank holidays off (and be paid for them). The way they are paying me (until the UK payroll and business side of things is set up) is as a contractor so they pay me my salary lump sum with all NI and tax in that for me to declare myself. I still get to claim bank holidays as a working day and be paid for them as I would do as a normal employee, hence why I have included those in the calculations as a normal full time employee would still be paid for them. It's a slightly strange arrangement I agree but should only be temporary.

Incidentally I had a lot of leave which I was paid for in total in November when I left Australia (and my Australian payroll was finalised) to come back to the UK, so since being back i've started from zero again anyway and I will have only accrued a few days of leave since November and now.

What I basically need to do is invoice them for what they would pay a full time, permanent employee on the same salary as me inc NI, tax and pension contributions for December 2021, and as if i'd used 3 days of unpaid leave, which I think is what i've outlined above.
 
Yeah, I would work out what my "day rate" was and then invoice how much of your salary you've still got to claim for the year, minus the "day rate" x unpaid time off. This assumes you're Jan-Dec for your holidays and you're otherwise fully invoiced your costs for Jan-Nov.
 
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