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Umbrella Companies: New to contracting

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    #11
    Thank you.

    Is the best way of signing up through yourself directly?

    Comment


      #12
      Originally posted by kevinm3 View Post
      Thank you.

      Is the best way of signing up through yourself directly?
      Hi Kevin,

      You can either sign up here: Sign up with one of the UK's most respected Umbrella Companies today! or if you would prefer one of my team here could sort it out for you over the phone - 01206 761326.

      Look forward to having you on board
      Connect with me on LinkedIn

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      ContractorUK Best Forum Advisor 2015

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        #13
        Hi guys,

        I'm completely new to these forums, and relatively new to contracting / freelancing but the issue of Umbrella Companies is one that I was hoping to get some help with.

        Lisa - what would be the benefits of registering with yourselves?

        Comment


          #14
          Hi Lazy Genius

          Welcome to the forum

          Basically, all umbrella companies work in the same way so what you should be looking for is excellent customer service, transparency on their website, a good reputation and longevity in the market place. A good umbrella company should also make sure that you fully understand the way that an umbrella company differs to permanent employment before you register with them so look for informative articles on their website especially in relation to expenses and employer's NI. Any companies marketing their business based on 'take home pay' should be approached with caution as all UK umbrella companies should operate PAYE on all your earnings - a company promising 85% take home is unlikely to work in this way as income tax rates start at 20% and NI contributions at 12.8%.

          Why should you register with us? Because we're good

          HTH - any more questions just shout.
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            #15
            help !!!!!!!!!!!!!!

            right so my bf was contacted by an agency after seeing his cv online and offered him a 6 week contract £300 per day working 7 days a week

            he decided to take the ob on as a stop gap as hes due to start a full time position but not for 3 months

            he filled in all the forms and was told to register with an umbrella company as that is how they pay his wages between the agency and umbrella company this was all done for him and he was given log in details which he gave to me to keep an eye on

            so the timesheet was submitted and viewable on his umbrella profile was invoiced to the client for 1225 plus vat 245

            no his payslip went online and his take home pay was £762 !!!!

            breakdown as follows minus the pennies

            income to the company 1225

            ni employers contributions 129

            admin fee 1250

            total available for salary 1083

            tax 237

            ni 83

            paid to employee 762


            does this not seem awfully steep ? forgive me if im wrong but should the agency not be paying his employers ni contributions ?

            considering his annual pay this year is probably only going to be about 30k it seems that way

            Comment


              #16
              Originally posted by geemel79 View Post
              right so my bf was contacted by an agency after seeing his cv online and offered him a 6 week contract £300 per day working 7 days a week

              he decided to take the ob on as a stop gap as hes due to start a full time position but not for 3 months

              he filled in all the forms and was told to register with an umbrella company as that is how they pay his wages between the agency and umbrella company this was all done for him and he was given log in details which he gave to me to keep an eye on

              so the timesheet was submitted and viewable on his umbrella profile was invoiced to the client for 1225 plus vat 245

              no his payslip went online and his take home pay was £762 !!!!

              breakdown as follows minus the pennies

              income to the company 1225

              ni employers contributions 129

              admin fee 1250

              total available for salary 1083

              tax 237

              ni 83

              paid to employee 762


              does this not seem awfully steep ? forgive me if im wrong but should the agency not be paying his employers ni contributions ?

              considering his annual pay this year is probably only going to be about 30k it seems that way
              Nope, looks reasonable to me (assuming he only worked 4 days and the umbrella fee is actually £12.50...).

              Working through an umbrella you get taxed as an employee but Employer's NICs, are the contractor's liability, nobody else's. Welcome to reality.
              Blog? What blog...?

              Comment


                #17
                Originally posted by geemel79 View Post
                right so my bf was contacted by an agency after seeing his cv online and offered him a 6 week contract £300 per day working 7 days a week

                he decided to take the ob on as a stop gap as hes due to start a full time position but not for 3 months

                he filled in all the forms and was told to register with an umbrella company as that is how they pay his wages between the agency and umbrella company this was all done for him and he was given log in details which he gave to me to keep an eye on

                so the timesheet was submitted and viewable on his umbrella profile was invoiced to the client for 1225 plus vat 245

                no his payslip went online and his take home pay was £762 !!!!

                breakdown as follows minus the pennies

                income to the company 1225

                ni employers contributions 129

                admin fee 1250

                total available for salary 1083

                tax 237

                ni 83

                paid to employee 762


                does this not seem awfully steep ? forgive me if im wrong but should the agency not be paying his employers ni contributions ?

                considering his annual pay this year is probably only going to be about 30k it seems that way
                If you want to save the Er's NIC then you'll need to go down the Ltd Co. route - more admin but take home pay much better. It totally depends on your circumstances.

                Assuming a daily rate of £300k, you'll have annual income of £69k (46 weeks) (plus £2.6k from the VAT flat rate scheme saving in the first year) accountant's fees would be only a little more than what you are paying the Umbrella. Assuming you withdraw all profits your net pay will look more like £4k per month (£51k annually).

                If you income is likely to be at this level I would highly recommend going Ltd. If £30k then probably not worth it.

                Andrew

                Comment


                  #18
                  Originally posted by Andrew@NymanLinden View Post
                  If you want to save the Er's NIC then you'll need to go down the Ltd Co. route - more admin but take home pay much better. It totally depends on your circumstances.

                  Assuming a daily rate of £300k, you'll have annual income of £69k (46 weeks) (plus £2.6k from the VAT flat rate scheme saving in the first year) accountant's fees would be only a little more than what you are paying the Umbrella. Assuming you withdraw all profits your net pay will look more like £4k per month (£51k annually).

                  If you income is likely to be at this level I would highly recommend going Ltd. If £30k then probably not worth it.

                  Andrew
                  Can I have a day rate of £300k.... please....

                  Seriously, it's reportedly a three month deal until he takes on a permie role, and it's clear they have no ideas about contracting anyway; so umbrella is the only viable option.
                  Blog? What blog...?

                  Comment


                    #19
                    Originally posted by geemel79 View Post
                    does this not seem awfully steep ? forgive me if im wrong but should the agency not be paying his employers ni contributions ?
                    The only question I would have is why the calculation is based off £300 including VAT rather than excluding VAT. I've not gone the umbrella route before, but when I agree a rate, that is excluding VAT.

                    If the rate discussed was VAT inclusive, then the calculator from contractor umbrella gives a net income of £753.87 which is pretty close to what you get.
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                    Comment


                      #20
                      WTFS

                      If the contract rate, as agreed in the business to business contract between the umbrella company and the agency is £300.00 per day then it would be usual for this rate to be plus VAT and not inclusive of VAT - other than that the figures seem OK. You should advise your friend that he cannot claim travel expenses whilst he's with the umbrella company as he will only be working on a single assignment whilst in their employment.
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