Recommended Umberella Companies
Discussion
I am currently with Giant but I am finding them very hard going.
They have been late will all my payments so far and seem to charge an awful lot more than other companies (£35pw).
I dont know how some charge more for admin than others but the pay works out roughly the same.
Any recommendations...?
Claire
They have been late will all my payments so far and seem to charge an awful lot more than other companies (£35pw).
I dont know how some charge more for admin than others but the pay works out roughly the same.
Any recommendations...?
Claire
Doing contracting at the moment.
I was advised to get an umberella company as they do all the hard stuff and I just get the money at the end.
Hving read DJ's post as well about becoming a Limited company it seems an awful lot of work and I am bound to miss something out and end up inside for tax fraud or something.
Claire
I was advised to get an umberella company as they do all the hard stuff and I just get the money at the end.
Hving read DJ's post as well about becoming a Limited company it seems an awful lot of work and I am bound to miss something out and end up inside for tax fraud or something.
Claire
I seem to recall Gaffer asking this a while back, eric. We* came to the conclusion that, since it was short-term and she would probably return to employment afterwards, that forming a PSC would be more hassle than it was worth.
This is probably about the only scenario in which using an umberella company is preferable.
(* by "we" I mean the PH collective)
>> Edited by JonRB on Thursday 13th May 15:38
This is probably about the only scenario in which using an umberella company is preferable.
(* by "we" I mean the PH collective)
>> Edited by JonRB on Thursday 13th May 15:38
Gaffer said:
Doing contracting at the moment.
I was advised to get an umberella company as they do all the hard stuff and I just get the money at the end.
Hving read DJ's post as well about becoming a Limited company it seems an awful lot of work and I am bound to miss something out and end up inside for tax fraud or something.
Claire
Claire,
If I remember rightly you were talking about a short term contract that was inside IR35, so at the time people recommended a brolly as a decent way of avoiding the overhead of a limited company.
Have you had a look at contractoruk.com? There are a lot of people in a similar position on there who could probably point you at a decent one. I've only had limited dealings with them, but ParasolIT were OK.
I'm sure Eric will be able to provide better advice, but the best way of working really does depend on your situation. I wouldn't consider a limited company (with the associated hassle, accountancy fees etc) unless you could quantify the benefit of using one. Inside IR35, I can't see many advantages.
The one thing I would say is make sure you choose one of the big names who have been established for a while. I know of a few people who lost money because their umbrella companies went under.
Glad you're back to work again Claire - I hope you've found something you enjoy!
edited to add: £35 per week!!! I think Parasol were £42 per month (when you're getting paid weekly). Sounds like you could get a better deal.
Darren.
>> Edited by _DJ_ on Thursday 13th May 15:40
Yep that's the one JonRB.
I have a new contract for 6 months, I may carry on contracting after that, dunno yet there is a lot going on personal wise that may keep me contracting for the next 18 months though.
Would my own company be a better bet then..? is there an online checklist of stuff I have to do...?
Claire
I have a new contract for 6 months, I may carry on contracting after that, dunno yet there is a lot going on personal wise that may keep me contracting for the next 18 months though.
Would my own company be a better bet then..? is there an online checklist of stuff I have to do...?
Claire
Gaffer said:
Yep that's the one JonRB.
I have a new contract for 6 months, I may carry on contracting after that, dunno yet there is a lot going on personal wise that may keep me contracting for the next 18 months though.
Would my own company be a better bet then..? is there an online checklist of stuff I have to do...?
Claire
I'd wait for Eric's response to that (he seems to be the oracle around here!). However, if you do intend to setup a limited company I'll help you as much as I can. I'm doing the same at the moment (though it's not just supplying labour in the same way you would be doing) so should have it fresh in my mind.
Tip 1: See my other thread, and don't make the same mistake
Gaffer said:
Would my own company be a better bet then..? is there an online checklist of stuff I have to do...?
Depends on how long you're going to contract for and whether or not you're caught by IR35.
If you're going to contract for a while and be outside IR35 then a company will be far more tax efficient.
As my accountant says on his website - "It's not how much you earn that matters... it's how much you keep".
>> Edited by JonRB on Thursday 13th May 15:44
JonRB said:
Would my own company be a better bet then..? is there an online checklist of stuff I have to do...?
Depends on how long you're going to contract for and whether or not you're caught by IR35.
If you're going to contract for a while and be outside IR35 then a company will be far more tax efficient.
As my accountant says on his website - "It's not how much you earn that matters... it's how much you keep".
>> Edited by JonRB on Thursday 13th May 15:44
Not wanting to pre-judge this, but IIRC the job would involve working in a support type role for a company so I would imagine would be well inside IR35.
JonRB: Looks like Microsoft have nicked your shutdown application (type shutdown /i on a Windows 2003 machine). Get that law suit in!
Darren.
I am back on Helpdesk roles. They are the only ones I appear to be suitably qualified for.
I am about to start a 6 month contract for Tony the Tiger in Manchester so it means living up there during the week and back down here (glos) at weekends.
I freely admit I am not a buisness-minded person. I just want to get paid at the end of the week/month with the minimum fuss. I have to get my payslip explained to me as it seems I get paid a lot but end up with not a lot of it.
Claire
I am about to start a 6 month contract for Tony the Tiger in Manchester so it means living up there during the week and back down here (glos) at weekends.
I freely admit I am not a buisness-minded person. I just want to get paid at the end of the week/month with the minimum fuss. I have to get my payslip explained to me as it seems I get paid a lot but end up with not a lot of it.
Claire
I would imagine that the amount you "manage to keep" (i.e after all taxes and NI have been charged) is identical whether you are administered through an umbrella company or set up your own company and make use of a reputable and suitably qualified accountant (of course). How much you keep will be dependant on whether your contract is within the ambit of IR35 or not. It doesn't matter whether you are running your own company or are "employed" under an unbrella, you will end up with same amount into your hand.
The key variable is going to be how much you are charged for the privilege of having your affairs managed by someone else, whether it is an accountant or an umbrella company. I would suggest that £35 per week seems rather high (it equates to an annual fee of £1,820). An annual fee of less than £1,000 would normally be more appropriate - unless of course, you have some horrendously complicated elements to your financial arrangements with the contracting company.
The key variable is going to be how much you are charged for the privilege of having your affairs managed by someone else, whether it is an accountant or an umbrella company. I would suggest that £35 per week seems rather high (it equates to an annual fee of £1,820). An annual fee of less than £1,000 would normally be more appropriate - unless of course, you have some horrendously complicated elements to your financial arrangements with the contracting company.
_DJ_ said:Hmmm. Win2K too. Ah well, it was fun while it lasted.
JonRB: Looks like Microsoft have nicked your shutdown application (type shutdown /i on a Windows 2003 machine).
If only I'd got round to writing a Win9x/Me client like I've been planning to for the past 4 years I might have made some proper money out of it.
Gaffer said:
I can show you my payslip if needed to see if I am getting stung or not.
Claire
Claire,
You are getting stung - £35/wk is too high by far.
Other Umbrellas offer much cheaper rates.
Parasol charge 42/month, i.e <500yr. This is at least as cheap as an accountant.
Eric - Are you saying there aren't any tax advantages when considering the expenses you can claim using an Umbrella? I'm not sure what Claire's situation is in terms of expenses but surely under IR35 you can only claim 5% expenses through a limited company where you could get away with more when 'permanently employed' through an umbrella?
The main marketing drive from Umbrellas seems to focus on two things:
1) Simplicity. i.e they'll manage everything for you.
2) Tax breaks. They all claim to have an agreement with the IR over acceptable expenses.
edited to add: Got my figures wrong
. Parasol charge 14.95 per week (when paid weekly) or 44.95 per month (when paid monthly). If you plug the figures into their net pay calculator you should get an idea whether you're currently losing out. <a href="http://www.parasolit.co.uk/default.asp?pageid=57"><a href="http://www.parasolit.co.uk/default.asp?pageid=57">www.parasolit.co.uk/default.asp?pageid=57</a></a>. I know I sound like a ParasolIT advert, and it's not meant that way at all. I'd attempt to decide whether an umbrella is the way to go, then if it is, ask around on the contractoruk BBS to find a good company who are cheaper than your current provider.
Darren.
>> Edited by _DJ_ on Thursday 13th May 16:22
What "expenses" can an umbrella company claim over and above those already available to an "employee" or someone caught under the provisions of IR35.
As far as I can make out, under IR35, expenses which would normally be allowed to be claimable to an employee under Schedule E rules are fully allowable in an IR35 company's accounts and, in addition to those expenses, a special "IR35 only" 5% global expenses amount can also be claimed.
I've always thought that "umbrella" companies had to operate no differently to any other sort of employment agency in that the individual becomes an "employee" of the "umbrella" company and suffers normal tax and NI on the "wages" paid to him/her by the "umbrella" company. What additional expenses can they claim that the individual would not be able to claim if he/she was running his/her own company but subject to IR35?
As far as I can make out, under IR35, expenses which would normally be allowed to be claimable to an employee under Schedule E rules are fully allowable in an IR35 company's accounts and, in addition to those expenses, a special "IR35 only" 5% global expenses amount can also be claimed.
I've always thought that "umbrella" companies had to operate no differently to any other sort of employment agency in that the individual becomes an "employee" of the "umbrella" company and suffers normal tax and NI on the "wages" paid to him/her by the "umbrella" company. What additional expenses can they claim that the individual would not be able to claim if he/she was running his/her own company but subject to IR35?
You could be (and almost certainly are right). They state that the following can be claimed:
"Business Mileage, Receipted Travelling, Car parking, Rail fares, Tolls, Subsistence (Hotels, Meals), Specific Professional Subscriptions, Office Stationery, A proportion of phone bills, Congestion Charging and Eyesight Tests."
But from what you saying, you can legitimately claim those anyway, even within an IR35 limited company.
So, back to Claire's question. Why not use an umbrella company? The advantage of using a LTD company is:
- There's a 5% additional allowance on expenses
- You cut out the middle man
- An accountant shouldn't be more than the Umbrella companies charges (approx £600 per year).
And the umbrella:
- No tax returns to complete, bank accounts to open etc etc
- You don't have to manage your money in the same manner. Money paid to you is yours to spend
- You can just do your job. Umbrella company working is much more similar to being in permanent employment from the admin side of things.
Darren.
"Business Mileage, Receipted Travelling, Car parking, Rail fares, Tolls, Subsistence (Hotels, Meals), Specific Professional Subscriptions, Office Stationery, A proportion of phone bills, Congestion Charging and Eyesight Tests."
But from what you saying, you can legitimately claim those anyway, even within an IR35 limited company.
So, back to Claire's question. Why not use an umbrella company? The advantage of using a LTD company is:
- There's a 5% additional allowance on expenses
- You cut out the middle man
- An accountant shouldn't be more than the Umbrella companies charges (approx £600 per year).
And the umbrella:
- No tax returns to complete, bank accounts to open etc etc
- You don't have to manage your money in the same manner. Money paid to you is yours to spend
- You can just do your job. Umbrella company working is much more similar to being in permanent employment from the admin side of things.
Darren.
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