{"id":1579,"date":"2024-08-14T15:07:31","date_gmt":"2024-08-14T14:07:31","guid":{"rendered":"https:\/\/wearesapphire.co.uk\/contracting\/?post_type=insights&#038;p=1579"},"modified":"2024-08-14T15:11:53","modified_gmt":"2024-08-14T14:11:53","slug":"income-illustrations-knowing-what-is-right","status":"publish","type":"insights","link":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/","title":{"rendered":"Income illustrations: Knowing what is right"},"content":{"rendered":"<p><span data-contrast=\"auto\">In the international contracting world, income illustrations are often requested early in the recruitment process. These projections help contractors determine whether a role is financially viable, saving time for both the contractor and the hiring company.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">But how can contractors be sure the figures provided are accurate? In this article, we\u2019ll explore the key factors to consider when evaluating income illustrations, ensuring you can spot realistic projections and avoid any unpleasant surprises.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><b><span data-contrast=\"auto\">What is an income illustration?<\/span><\/b><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">An income illustration is a tool used to show contractors how much of their daily or hourly rate will end up as net pay in their bank account. This can take the form of a table, PDF, Word document, or even a few sentences in an email. These illustrations help contractors understand the local tax system, identify their liabilities, and ultimately decide if the net amount meets their financial needs.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Agencies and clients use these illustrations to assist contractors in making informed decisions about assignments. Typically provided by umbrella companies, these projections are not always accurate. Some are overly optimistic, while others are misleading or completely incorrect.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><b><span data-contrast=\"auto\">Common pitfalls in income illustrations<\/span><\/b><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">Experienced contractors can often spot inflated illustrations, but those new to contracting or working in a new country might not recognise errors. These mistakes can lead to significant issues down the road. Here are some common tactics used to inflate income illustrations:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"6\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">Adding <\/span><span data-contrast=\"auto\">unattainable<\/span><span data-contrast=\"auto\"> expenses to the calculation to reduce taxable income, thereby increasing the net take-home pay.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"6\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"auto\">Underestimating social security contributions by calculating them at a minimum level or even zero, without properly assessing the contractor\u2019s status.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"6\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><span data-contrast=\"auto\">Applying incorrect tax brackets, such as combining tax brackets for married couples or using tax breaks for non-nationals, which can artificially lower the income tax rate.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"6\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"4\" data-aria-level=\"1\"><span data-contrast=\"auto\">Excluding additional contributions like municipal tax, healthcare costs, and other mandatory deductions, which can make the net pay appear more attractive.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<p><span data-contrast=\"auto\">Unless you\u2019re an expert in local taxes it can be difficult to spot if any of these things have happened. This means you could get a shock when you get paid or have to submit a tax return.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><b><span data-contrast=\"auto\">How to spot red flags in income illustrations<\/span><\/b><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<p><span data-contrast=\"auto\">To avoid being misled by inflated figures, contractors and clients should be vigilant when reviewing income illustrations. Here are some key points to check:<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/p>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Realistic retention rates:<\/span><\/b><span data-contrast=\"auto\"> For employed solutions, the net retention typically hovers around 50%. For self-employed contractors, 65% to 70% is achievable. A net retention of 90% is a clear red flag\u2014if it seems too good to be true, it probably is.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Social security contributions:<\/span><\/b><span data-contrast=\"auto\"> These should always be included in the figures. Whether listed as a single figure or broken down into employer and employee contributions, it should never be zero unless specifically requested or <\/span><span data-contrast=\"auto\">explained<\/span><span data-contrast=\"auto\">.<\/span><span data-ccp-props=\"{&quot;201341983&quot;:0,&quot;335559739&quot;:160,&quot;335559740&quot;:259}\">\u00a0<\/span><\/li>\n<\/ul>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"5\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><b><span data-contrast=\"auto\">Income Tax rates:<\/span><\/b><span data-contrast=\"auto\"> In Europe, income tax rates can range from 5% in Italy to 50% in Sweden. As a general rule, expect to see income tax rates between 30% and 45%. This average range helps to mitigate most of the tricks used to inflate take-home pay.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>In the international contracting world, income illustrations are often requested early in the recruitment process. These projections help contractors determine whether a role is financially viable, saving time for both the contractor and the hiring company. <\/p>\n","protected":false},"author":1,"featured_media":1383,"menu_order":0,"template":"","class_list":["post-1579","insights","type-insights","status-publish","has-post-thumbnail","hentry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Income illustrations: Knowing what is right - Sapphire Contracting<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Income illustrations: Knowing what is right - Sapphire Contracting\" \/>\n<meta property=\"og:description\" content=\"In the international contracting world, income illustrations are often requested early in the recruitment process. These projections help contractors determine whether a role is financially viable, saving time for both the contractor and the hiring company.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/\" \/>\n<meta property=\"og:site_name\" content=\"Sapphire Contracting\" \/>\n<meta property=\"article:modified_time\" content=\"2024-08-14T14:11:53+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/wearesapphire.co.uk\/contracting\/wp-content\/uploads\/sites\/3\/2024\/06\/SAPPHIRE_0283-v2.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1600\" \/>\n\t<meta property=\"og:image:height\" content=\"1141\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Estimated reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/\",\"url\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/\",\"name\":\"Income illustrations: Knowing what is right - Sapphire Contracting\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/wp-content\\\/uploads\\\/sites\\\/3\\\/2024\\\/06\\\/SAPPHIRE_0283-v2.jpg\",\"datePublished\":\"2024-08-14T14:07:31+00:00\",\"dateModified\":\"2024-08-14T14:11:53+00:00\",\"breadcrumb\":{\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/#breadcrumb\"},\"inLanguage\":\"en-GB\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-GB\",\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/#primaryimage\",\"url\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/wp-content\\\/uploads\\\/sites\\\/3\\\/2024\\\/06\\\/SAPPHIRE_0283-v2.jpg\",\"contentUrl\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/wp-content\\\/uploads\\\/sites\\\/3\\\/2024\\\/06\\\/SAPPHIRE_0283-v2.jpg\",\"width\":1600,\"height\":1141},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/insights\\\/income-illustrations-knowing-what-is-right\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Income illustrations: Knowing what is right\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/#website\",\"url\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/\",\"name\":\"Sapphire Contracting\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/wearesapphire.co.uk\\\/contracting\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-GB\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Income illustrations: Knowing what is right - Sapphire Contracting","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/","og_locale":"en_GB","og_type":"article","og_title":"Income illustrations: Knowing what is right - Sapphire Contracting","og_description":"In the international contracting world, income illustrations are often requested early in the recruitment process. These projections help contractors determine whether a role is financially viable, saving time for both the contractor and the hiring company.","og_url":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/","og_site_name":"Sapphire Contracting","article_modified_time":"2024-08-14T14:11:53+00:00","og_image":[{"width":1600,"height":1141,"url":"https:\/\/wearesapphire.co.uk\/contracting\/wp-content\/uploads\/sites\/3\/2024\/06\/SAPPHIRE_0283-v2.jpg","type":"image\/jpeg"}],"twitter_card":"summary_large_image","twitter_misc":{"Estimated reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/","url":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/","name":"Income illustrations: Knowing what is right - Sapphire Contracting","isPartOf":{"@id":"https:\/\/wearesapphire.co.uk\/contracting\/#website"},"primaryImageOfPage":{"@id":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/#primaryimage"},"image":{"@id":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/#primaryimage"},"thumbnailUrl":"https:\/\/wearesapphire.co.uk\/contracting\/wp-content\/uploads\/sites\/3\/2024\/06\/SAPPHIRE_0283-v2.jpg","datePublished":"2024-08-14T14:07:31+00:00","dateModified":"2024-08-14T14:11:53+00:00","breadcrumb":{"@id":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/#breadcrumb"},"inLanguage":"en-GB","potentialAction":[{"@type":"ReadAction","target":["https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/"]}]},{"@type":"ImageObject","inLanguage":"en-GB","@id":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/#primaryimage","url":"https:\/\/wearesapphire.co.uk\/contracting\/wp-content\/uploads\/sites\/3\/2024\/06\/SAPPHIRE_0283-v2.jpg","contentUrl":"https:\/\/wearesapphire.co.uk\/contracting\/wp-content\/uploads\/sites\/3\/2024\/06\/SAPPHIRE_0283-v2.jpg","width":1600,"height":1141},{"@type":"BreadcrumbList","@id":"https:\/\/wearesapphire.co.uk\/contracting\/insights\/income-illustrations-knowing-what-is-right\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/wearesapphire.co.uk\/contracting\/"},{"@type":"ListItem","position":2,"name":"Income illustrations: Knowing what is right"}]},{"@type":"WebSite","@id":"https:\/\/wearesapphire.co.uk\/contracting\/#website","url":"https:\/\/wearesapphire.co.uk\/contracting\/","name":"Sapphire Contracting","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/wearesapphire.co.uk\/contracting\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-GB"}]}},"_links":{"self":[{"href":"https:\/\/wearesapphire.co.uk\/contracting\/wp-json\/wp\/v2\/insights\/1579","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/wearesapphire.co.uk\/contracting\/wp-json\/wp\/v2\/insights"}],"about":[{"href":"https:\/\/wearesapphire.co.uk\/contracting\/wp-json\/wp\/v2\/types\/insights"}],"author":[{"embeddable":true,"href":"https:\/\/wearesapphire.co.uk\/contracting\/wp-json\/wp\/v2\/users\/1"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/wearesapphire.co.uk\/contracting\/wp-json\/wp\/v2\/media\/1383"}],"wp:attachment":[{"href":"https:\/\/wearesapphire.co.uk\/contracting\/wp-json\/wp\/v2\/media?parent=1579"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}