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...]
As a marketing consultant for Contractors Umbrella Company has some excellent advice. "I've gained an understanding into not only the expectations of today's contract worker but also into the increasing difficulty they have in choosing a reliable umbrella company. There are six things I believe you should consider when choosing an Umbrella company".
The process is simple; any umbrella company that over complicates the process when you first enquire is likely to over complicate making payment to you. The simple fact is; you submit your timesheet with any expenses you have incurred to your umbrella, the umbrella company invoices your recruitment agency/ client whom then send over the monies invoiced for and your umbrella calculates the tax and NI; sending your payment on the same day - simple.
A dispensation basically alleviates the administration burden of having to send all receipts into the umbrella company before they can process them (not all expenses but usually travel, subsistence and accommodation). Those umbrella companies without one will require you to post, fax or email copies of your receipts for all expenses = ball ache. Another point I would make; beware of umbrella companies that process the maximum expense allowances possible even though you don't incur the expense.
There is nothing worse than having a straight forward query and then being passed around the houses before getting an answer. Make sure the umbrella company has a dedicated customer service team, allowing any questions you have to be answered promptly and efficiently.
There's a wealth of feedback on the web, so take two minutes out and type their name in Google to see what others think about them. Apart from Umbrella Compare's umbrella company comparison calculator, there's no better way to get a recommendation from someone with first hand experience using the service.
There are a number of 'baby' umbrella companies popping up who have very little experience in the market. I'm not tarnishing them all with the same brush, but some have not invested in the technology or people needed to provide the excellent service levels you deserve. It's always worth looking into how long they have been established.
Umbrella companies with no other alternative solutions in place are likely to tell you that the umbrella company solution is ideal for you until they turn blue in the face. This however is not necessarily true. There are other solutions, such as operating through your own Limited Company. One tip…always seek unbiased advice as it could save you a great deal of money.
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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.