If you are a contractor, who is fed up working through a limited company and constantly worried about taxes and IR35 regulation. Then making your quest towards an umbrella company is a wise decision. Let's understand the working structure of an umbrella company, which is pretty basic.
When you register with an umbrella company, then you become an employee. The umbrella company will get the payment from their agency/client, and then process your payment after statutory deduction and emailing payslip taking care of your detailed accounts.
The above information might have made your mind forward in choosing an umbrella company over an agency payroll. Let’s go deeper and see which one is the best for you. Since we believe letting you know all the information is our duty as a content creator.
|Employment||When working for an agency payroll, your contract ends with the assignment.||Where about in umbrella due to overarching contract there is continuous Employment. You may be working with multiple agencies but all payment will be processed through Umbrella services. So, you will always have continuous Employment|
|Insurance trouble||Some agency payroll provides you insurance some agency doesn’t||Some umbrella companies even cover additional insurance like accidental cover and health cover, providing you with no additional cost|
|Costs||No direct costs involved when you work with an agency payroll||When an employee decides to leave an agency payroll and come to an umbrella company, then there are some costs involved. This cost is the margin umbrella charges for processing your payment but also gives tax benefit on margin to save certain amount of tax|
|Expenses claim||No tax returns available||You will have the chance to claim tax relief on certain expenses|
|Employee benefits||No benefits that are worth noticing||Street brand discounts, restaurant discounts, sick pay, maternity pay and medical health plans are available.|
When compared, umbrella companies emerge as a hassle free services which lets you focus on work and not on any admin task with additional expenses to claim. We have stated a complete list of differences why an umbrella company is more beneficial for you. At the end it's always you, who will decide. If you have any questions regarding the umbrella company, contact us.
At DNS umbrella we will help you understand umbrella benefits with a hassle free services.