Are you a contractor? If you work for someone else, it is important to know whether you are working for that person in an employed capacity or in a self-employed capacity as an independent contractor.
Your employment status will determine the charge to tax on income from your employment or self-employment. It will also determine the class of NICs, which are to be paid.
Umbrella Companies employ you for tax purposes and complete central returns for all their contractors. It's less hassle and more flexible for you but take home pay is typically less than that the limited company option.
The best option for you depends on your plans, 'one off' contract or 'contractor for life'? [Read More...]
Contractors, freelancers and temporary workers love the lifestyle and sense of freedom that comes with being 'self-employed'. Choosing how to trade as a contractor is an important part of freelancing, and the choice between setting up your own limited company or using the services of an umbrella company has to be considered.
Unlike permanent employees, as a contractor you'll face various tax implications which can affect exactly how much your take home pay will be each month. You're looking for a way of reducing your tax bill, where possible, and the professional advice of your umbrella company is set up for exactly this.
One of the other key benefits provided by an umbrella company is that they provide you with a ready-made limited company through which you can operate multiple contracts.
The umbrella company does all the administration and paperwork and only charges when you're working, so in between contracts there are no worrisome bills.
The benefit from using an umbrella company is that it saves you time and worry on all the complex administration usually associated with running a limited company, including:
All legitimate umbrella companies provide additional benefits such as holiday and sick pay.
Umbrella companies can also give the contractor access to other benefits not otherwise readily available to them, such as pension schemes, private health-care, life and critical illness insurance and childcare vouchers.
Umbrella companies provide Public Liability insurance cover within the fixed price.
An umbrella company is designed for today's modern contractor who has better things to do after a hard day's work than sit in front of a computer struggling with spreadsheets, forms and figures.
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It's the basics... Compliance with Tax, VAT, PAYE and fiscal arrangements is mandatory for contractors regardless of whether you use an umbrella company or your own limited company.
Incredible then that there are still rogue umbrella companies and limited company accountants who expose their contractors to fraud. Umbrella Compare provides THE solution, we thoroughly vet all umbrella companies and limited company accountants that we list [Read more...].
Umbrella Compare provides a holistic overview of contracting with the aim of helping new and old contractors find the right payroll solutions. Contracting should be about focusing on the contract, not payroll, accounting, HMRC and bureaucracy.