Umbrella companies have flourished over the past decade in the UK and can offer a ‘hassle-free’ business structure to operate under for many contractors. Being a contractor has many positives; from deciding when you want to work and what jobs you want to pick up. But being a contractor/temporary worker means you won’t be paid via the PAYE scheme. So how exactly do you get paid and who sorts it out?
What is an Umbrella Company?
An umbrella company is a company that employs agency contractors who work on temporary contract assignments, usually through a recruitment agency in the United Kingdom. A contract is signed between the umbrella company and recruitment agency (or end client) on behalf of the contractor who will be carrying out the assignment.
The umbrella companies provide a payroll service to its employees, processes all timesheets and invoices, and pays its employees a salary after allowing for deductions.
How does an umbrella service work?
Our umbrella service for contractors and freelancers is beautifully simple. We work with your agency and clients to take care of all your tax and National Insurance responsibilities.
We’ll make sure you get paid regularly, leaving you to concentrate on your contracting work.
No need for worries about IR35 or keeping on top of complicated tax rules, your time is freed up to concentrate on the work you do.
Here are some of the things you will receive from our service:
- Take care of the timesheets you get signed by your manager (this will be showing how many hours you have worked within a week/month)
- We will create your payroll for that amount of time
- Once we have processed your payroll, we will pay you your salary*
- We will issue you a payslip which will detail all of the deductions and your net take-home pay
*Your salary will include deductions. These will be for; employment taxes, pre-agreed umbrella fee/margin, personal taxes and pension contributions (if applicable).
Is an Umbrella Company Payroll Right for Me?
Joining a compliant umbrella company gives contractors the best of both worlds, providing them with the flexibility to work on an assignment while enjoying the same rights and benefits given to permanent employees. These include:
- guaranteed hours of work
- holiday pay
- sick pay
- maternity/paternity pay
- access to a workplace pension
By joining with us, you will be getting an umbrella payroll company that will be on hand with any inquiry you may have about your payroll or if you are looking for advice on how to get the most out of it.
If you require an umbrella company, call us on 0207 537 6631 or fill out our contact form and one of our representatives will be in touch as soon as possible.