Benefits Of Working Through An Umbrella

An umbrella company acts as an employer to contractors who work in temporary roles, often through a recruitment agency. It enables you to enjoy the best of both worlds the freedom and flexibility afforded by contracting plus all the benefits and convenience of being an employee.

There are both financial and time management benefits of working through an umbrella product.

There are two major financial gains working through an Umbrella structure. Firstly the contractor is entitled to a higher rate of pay due to the agency uplift normally provided by the agency. Secondly you can offset expenses that are wholly and exclusively related to the work that you do against your tax. In all instances these are expense or portion of expenses that are within HM Revenue & Customs guidelines. Expense payments will usually be made to employees at the same time as salary payments. Most common expenses are travel, subsistence (lunches) and phone calls. This in essence decreases your taxable salary and therefore reduces your PAYE and NI taxes. You even get a higher net pay!

The time management saving and satisfaction comes through the Umbrella product ensuring that all your tax payments are made. The service they provide is that you are covered with full suite of Professional Insurances: employers liability, public liability and professional indemnity cover. Some are able to fast track your National Insurance applications if required (no appointments necessary). Your provider will then issue invoices on your behalf, collect payments from your agency/client, pay your PAYE tax and NI contributions to HM Revenue and Customs and then pay your net pay straight into your personal bank account. Some providers can also help claim back your National Insurance contributions through a NI Rebate.

All this but there are none of the administrative and regulatory hassles associated with self employment or running your own company. It is that simple! And you even get a higher net pay!

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Article Originally Published On: http://www.articlesnatch.com

Tags: financial gains

, recruitment

, contractors

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