How Do You Know If Your Umbrella Company Is Good Or Not? (or if you should have one at all)
Umbrella companies are an option in the UK for some contractors who get their work through a recruitment agency to increase the amount of pay the contractor takes home.
Question Is – How do you know if you are signing up with a good umbrella company or even if you should sign up with one at all?
Why an umbrella may be a good option for you?
In simple terms: The recruitment agency pays into the umbrella company who then pays you – usually more.
Because you are effectively being paid by the umbrella company some expenses can be claimed such as mileage, travel expenses, hotel or accommodation expenses and professional subscriptions. Claiming these expenses through the umbrella company means that you (the contractor) can often end up with more income. If you want more information – check out wikipedia for more.
Of course, there is a fee for the administration of the umbrella company and there is a little paperwork too, but often the financial advantage outweighs the simplicity of PAYE (Pay As You Earn).
Ultimately, you need to make a decision one way or another what is best for you.
Here are some things you might want to compare
- Cost + Potential Hidden Costs
- Services Offered
- Recommendations From Others
Best Umbrella Companies in the UK Compared
Service Provider | Main Services Listed | Phone Number | Basic Service per Month (+VAT) | Set Up Fee | Closing Fee |
---|---|---|---|---|---|
No Worries | Professional Contractor Accounting Services | 0207 731 1117 | 85 | Free | £185 |
SJD | Freelancers, Contractors (IT, Engineering, Project Managers), Services (Business, Tax & Audit) | 0500 152500 | 110 | Unknown | Unknown |
Danbro | Financial Services, Additonal services for contractors and businesses, Recruitment Services, Insurances | 0800 731 3178 | 121.33* | Unknown | Unknown |
JSA Group | Offer services for Limited Company, Umbrella Company, Self Employment and Supporting | 0800 25 26 40 | 121.33* | Unknown | Unknown |
Pay Stream | Limited Company, Umbrella Company, Tax Returns, CIS Service | 0800 197 6516 | Unknown | Unknown | Unknown |
Tarpon | Umbrella & Free Limited Companies, Accountancy Services, Insurance, & Agency and Client Auditing | 0800 434 6402 | Unknown | Unknown | Unknown |
Parasol | Payroll, Financial Advice, Tax & Audit | 0800 084 6370 | 119.50 | Unknown | Unknown |
*Quoted as weekly – 52 weeks/12 months
NOTE: If you have just arrived in the UK there is a three step process you should follow;
When You First Arrive in UK
Step 1 – Get a national insurance number – You will need on regardless and they take a little while to sort out so ASAP is best.
Step 2 – Familiarise yourself with the basics of the UK tax system and the various way to pay tax in the UK to understand why an umbrella may be a good option for you.
Step 3 – Assess you own circumstances to decide if an umbrella company is likely a good option using the above information as a guide.
Finally, it is good to realise that ultimately you are responsible for paying your own taxes. Make sure you are confident that the choice you make is the right one.
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