In an unregulated industry, how can contractors keep away from dodgy operators? We look at how to identify the worst umbrella companies.
Umbrella Companies
Virtually all IT contractors work via limited or umbrella companies. In this section, we explore how PAYE umbrella schemes work.
- Find out what a PAYE umbrella company does.
- Why you should be cautious when reading umbrella company reviews.
- How much do the leading umbrella companies charge?
- The pros and cons of using an umbrella company.
- Why the scope for claiming umbrella company expenses has narrowed due to the SDC rules
- Which structure is best for you? Limited or Umbrella?
5 essential tips to help you find the best umbrella
- Don't focus purely on the weekly cost. Good customer service and communication skills are just as important. Ask other contractors for recommendations if you're looking for a new provider.
- Only sign-up to a UK-based PAYE umbrella. Never use offshore payment tax avoidance schemes.
- The only difference between take home pay quotes between umbrella companies should be the margin (fee) they charge.
- If you're caught by the Off-Payroll (IR35) rules, consider a flexible umbrella/limited model of working, so you can switch between the two with ease. Most leading accountants/umbrellas offer this service.
- Find a trusted umbrella in our umbrella directory.
Why am I paying Employers’ National Insurance as an umbrella contractor?
The number one question many umbrella companies are asked by their employees is: “why am I paying employers’ national insurance contributions?” – here we provide the answer and explain what other costs are payable by umbrella contractors.
What are umbrella companies, and how do they work?
Our complete guide to choosing an umbrella company; how a typical PAYE scheme works in practice, and key questions to ask prospective providers.
Umbrella companies and holiday pay – how is it calculated?
If you decide to contract via an umbrella company, you will be entitled to receive holiday pay (as an employee of the company). Here we look at what holiday pay is, and how it is calculated.
Advantages and disadvantages of using an umbrella company
There are a number of pros and cons to consider if you’re contemplating joining an umbrella company. Here, we look at the main advantages and disadvantages of becoming an umbrella employee.
Umbrella companies – IR35 and the off-payroll working rules
With the private sector off-payroll rules due to hit the contracting sector in April 2021, an industry expert explains what PAYE umbrella companies can offer contractors caught by the changes, and why you should watch out for unscrupulous operators.
Umbrella companies – the truth behind fake take-home pay claims
If you search the web for potential umbrella company providers, you’ll often find advertisements claiming to offer 90% or more take home pay after tax – using ‘compliant’ schemes. Here we examine why contractors should approach such schemes with caution.
Umbrella companies – ‘gross contract rate’, ‘umbrella rate’, ‘inside IR35 rate’ – what’s the difference?
One of the biggest sources of confusion for new umbrella company users lies in the way contractor pay rates are quoted. Does your rate include ’employment costs’, and if so, what does this mean? And are some unscrupulous providers misleading over the so-called ‘inside IR35 rate’?
How to understand your umbrella company payslip
Contractors receiving their first umbrella company payslip can sometimes find it challenging to understand exactly how their pay has been calculated and what deductions have been made. However, the actual payslip is fairly straightforward to understand once you know what to look for.
Questions to ask prospective umbrella company providers
If you have decided to go down the umbrella company route, there are dozens of providers out there. Here we look at some important things to consider when you are choosing a prospective provider.