PAYE Umbrella Payroll Companies

PAYE Umbrella Payroll companies are basically intermediary companies between your clients, yourself and the contractor. In contracting, there is plenty of boring and time consuming work like dealing with all the invoices and handling taxes. The main benefit of an umbrella company is that it will do all these administration work on your behalf, saving you a lot of time. Thus, your work burden will be less and you can spend your time more productively. 

After you sign a contract with an Umbrella company, you will technically become one of their "employee". However, you will have complete freedom. It is up to you to select your clients and you also won't have any boss to answer to. And another important benefit is that you will no longer have to face the HRMC again. 

Even if you sign up with an umbrella company, you can still deduct expenses while calculation tax. SInce you are basically still an employee of the company, all the places where you work will be considered as " temporary workplace". Hence, all the traveling expense which you incur in order to reach the site and all the other site related expenses can be claimed for deduction. 

IR35 is a very complex tax legislation which most contractors are afraid of. However, when you sign a contract with a PAYE umbrella company, you are free from IR35.

How to work with a PAYE Umbrella company; The entire process is extremely simple. Once you register with a PAYE umbrella company, you will have to sign an employment contract with them. After that, it is your job to find clients. However, once a contract is finalized between you and your client, you will have to forward the timesheet to the umbrella company. The client will make the payment to the umbrella company. They will deduct the NIC and tax and then they will pay you the remaining.