Umbrella Company Tips
Here are some umbrella company tips 5 advantages of being in one:-
1. Fast and easy way to start contracting if you are unsure about the
long term nature of the role or just want to “test the waters”.
2. No ongoing worry for the contractor over VAT liabilities, PAYE and
Corporation Tax.
3. Typically no set up nor termination charges (you should always check
this and read the small print as not all umbrella companies are the
same.)
4. No IR35 concerns if you are employed and paid via PAYE, less hassle
and allows contractor to concentrate on the role at hand.
5. Additional “employee” benefits often provided along with inclusive PI
and other relevant insurances.
Umbrella Company Tips What to Look Out for
The following are some tips about what to look out for when you are looking at joining a ‘brolly‘:-
1. Always check the umbrella company offering “generous” expense
dispensations have up to date Inland Revenue paperwork to support this.
A dispensation does not give any company carte blanche to flout IR
expense audit guidelines.
2. Check the small print for clauses holding back money based on minimum
fee levels or leaving before this has been reached.
3. Is the umbrella company affiliated to any recognised trade bodies?
E.g. PCG, ATSCO or REC
4. Umbrella companies should all be about service, ask the company if
they will work with your agency/client, ask for real up to date
testimonials.
5. Using an umbrella company should be low hassle, good returns on
wages and a fast easy way to contract. If a company makes some promises
over net returns that seem too good to be true, it probably is!
Loan schemes, offshore trusts and even composite arrangements are common IR
targets and worse still, sometimes leave contractors high and dry!
Penned by:-
Rob Crosland of Parasol
