One timesheet or two? That’s the question umbrella contractors should answer in a flash to avoid faff
For contractors at all levels of skills and industry experience, it seems timesheets are the bane of their contracting lives, especially when they are working via an umbrella company.
So, who should contractors complete a timesheet with?
Do you have to complete timesheets with the end-client, the agency, AND the umbrella?
Mirroring the number of timesheets contractors most often get asked to fill in, these are the TWO key questions I’m hearing at present, and the answers are something you need to know as soon as you start your assignment, writes Lucy Smith, founder of Clarity Umbrella.
One timesheet or two? That’s easy – ONE
In an ideal world, one timesheet is always going to be best for all parties concerned.
Just a single timesheet leaves less room for errors, which in turn means less delays in payments arising from queries and /or invoicing adjustments.
The easiest way of working is when the agency operates a ‘self-bill’ model. But what does self-bill mean for the whole supply chain?
How timesheets work with a self-bill agency
Well, the contractor completes a timesheet on their system, which should in turn send an invoice to the end-client while issuing a remittance / self-bill invoice that tells the umbrella what to expect in terms of days worked and payment terms on the invoice.
This reduces room for error on every part, as the end-client sees the timesheet and should approve it, and then all the same details are passed down the chain and the information duplicated accurately.
When your agency isn’t self-bill…
But if the agency isn’t ‘self-bill’, then the contractor will simply have no choice but to duplicate the timesheet on both the agency and umbrella portals.
Yes, it’s more work for the already hard-working contractor, but if it means you are going to get paid in full and without issue, then I guess it’s a means to an end, and you simply need to do it.
However -- just always ensure that the approved timesheet with the agency, exactly matches the submission on the umbrella portal.
Matchy-matchy matters most
Identical inputs is important, as any inconsistencies can lead to queries and in turn, an argument that the invoice was not submitted until the amends have been made! Then, the problem can be that the clock resets for the payment terms.
So, it’s absolutely crucial to get the data all present, matching, and correct.
On occasion, your contractor timesheet has to be inputted and logged on the end-client’s system. And yup; you’ve guessed it, unfortunately, this does mean if you’re in this unenviable scenario that you have to complete three, yes THREE timesheets!
More irritating than both the faff of more than one timesheet (remember, one is the magic number) and the frustration of timesheet portals, passwords and lost log-ins, is being out of pocket. The added indignity is when you’re out-of-pocket because of a timesheet fustercluck!
Top 3 timesheet /invoice questions to ask your agency
For all contractors when you start your assignment, these are the top three questions to ask, so you don’t end up with any payment issues due to missing documentation:
1. Dear agency, do I need to complete a timesheet for you? Do you have a portal on which I need to submit this?
2. Dear agency, do I need to submit a timesheet with the end-client?
3. Dear agency, are you self-billing or do you need my umbrella company to issue you with an invoice for payment?
Actions to take based on your agency’s reply
If the agency replies and says they are self-bill, then happy days! You won’t need to do anything with the umbrella (except please confirm this is ok with your umbrella), and in reality, the umbrella company should be able to upload based on the agency remittance / self-billing invoice. Less room for error.
If they agency replies and says they are not self-bill, then the umbrella will need you to submit details of the hours / days worked, in order for them to issue an invoice to the agency for payment.
Always check the details on payments with your umbrella. Why? Well, let’s say the agency is 30-day payment terms on the umbrella invoice, but then if you submit your timesheet late and therefore the invoice is issued later than the end of month, you may expect that the payment is still 30 days from the date the invoice was raised!
My final timesheet tip…
If you submit the timesheet late, then unfortunately you need to accept that payment may be late too. My advice to stop this happening; even to contractors who’ve been there done that and got a ‘timesheet’ T-shirt? Set yourself a diary note and make sure you submit the timesheets wherever you need to on the end of that period; be it weekly submissions or end of month submissions. That way payment delays cannot be down to an error on your part. Happy submitting contractors but -- remember, if given a choice, one timesheet is all you want.