Contractor Umbrella
Why Choose WIS Umbrella
Supporting you throughout your business journey with these accountancy services:
Fast Registration
Our registration process is quick and easy - one page, five steps and you can start your work within 24 hours.
Next Day Payments
We pay the very next day, into your personal account, with no additional fee for the transfer.
Flexible
If your circumstances change and you need to move from the umbrella to a limited company, that’s fast and simple too, and there’s no additional charge.
Dedicated Liaison Officer
With WIS, you get a dedicated personal employee liaison officer – someone who knows you and your work and will respond quickly to your queries, whether they arrive by email or phone.
Online Portal
We have a smart online portal for submitting timesheets and expenses, and viewing payslips, which works just as well on your mobile as from your desktop.
5 Star Reviews
But don’t take our word for it – we have five-star ratings on both Google reviews and Facebook based on customers’ own positive experiences of working with us.
What is an umbrella company?
Why use an umbrella company?
Put simply, they keep arrangements clean and simple.
Many firms prefer contractors to take this approach, too, because it reduces paperwork and complexity on their side. As well as easier administration, umbrella companies offer a full range of employee rights and benefits – from sick pay to maternity leave.
For those who find themselves undertaking one short contract after another, working through an umbrella can reduce bureaucracy and paperwork.
They can also be a great way to dip your toe in the world of contracting with minimal fuss and trouble, to decide if it is the long-term career path for you.
What Would Be Your Take-home Pay?
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Daily Rate
- Employers NI & Levy: £446.40
- Employee NI: £364.15
- Employee PAYE Tax: £556.02
- Total Tax: £1,366.57
- Margin: £60.00
- Total Net Income: £2,907.43
Daily Rate
- Employers NI & Levy: £988.31
- Employee NI: £474.10
- Employee PAYE Tax: £2,003.87
- Total Tax: £3,466.29
- Margin: £60.00
- Total Net Income: £5,141.71
Daily Rate
- Employers NI & Levy: £1,530.22
- Employee NI: £549.94
- Employee PAYE Tax: £3,520.71
- Total Tax: £5,600.88
- Margin: £60.00
- Total Net Income: £7,341.12
Daily Rate
- Employers NI & Levy: £2,072.13
- Employee NI: £625.78
- Employee PAYE Tax: £5,120.37
- Total Tax: £7,818.24
- Margin: £60.00
- Total Net Income: £9,457.72
Umbrella Vs. Limited Company
Contractors employed through umbrellas pay more tax than if they operated their own limited company.
On top of that, they must also make national insurance contributions (NICs) and pay the umbrella company’s fees.
For many, though, that additional price is more than good value given the ease of the arrangement, and the reduction in administration costs.
Forming your own limited company, on the other hand, will usually mean you take home more of your pay, but brings with it many legal and tax obligations, including submitting annual accounts and keeping formal records.
It also incurs administrative costs which might be more or less bearable depending on your earnings.
Another important point to consider is IR35, which does not apply to workers who are employed by an umbrella company.
IR35 applies only to limited company arrangements.
If a worker is ‘outside’ IR35, they are entitled to draw dividends from the company which do not attract NICs.
If they are ‘inside’ IR35, they must take their salary through PAYE or the umbrella company.
Claiming Expenses
Operating within the structures of a limited company offers opportunities to claim expenses against the business.
If you buy office equipment, for example, or subscribe to essential trade journals, you will be able to deduct those costs from your company’s turnover.
Working under an umbrella company means you won’t have this option.
In broad terms, you will be treated like a permanent employee, so you won’t be able to claim tax relief against the cost of your commute to the office, for example, or ordinary meals taken during a standard working day.
If you have a valid chargeable expense that was reimbursed to you from your clients, such allowable expenses are simply a reimbursement of the actual expenditure incurred and can be paid back to you free of income tax and NICs.
FAQs
No, WIS will not do this.
We are happy to work with you to decide whether the umbrella or limited company structure will work best for you, but it is always best to be straightforward and honest, and compliance with UK tax law is non-negotiable.
We advise against using offshore arrangements, complex pay-by-loan schemes, or other risky tax-avoidance measures.
WIS will process tax payments through PAYE. If all of your work is conducted through us it is unlikely you will need to complete a separate self-assessment tax return.
There are exceptions, however, such as if you were at any point in the preceding tax year:
- self-employed as a ‘sole trader’ and earned more than £1,000
- a partner in a business partnership
- rented out a property
- earned tips or commission
- derived income from savings, investments or dividends
We can definitely assist you with this if needed through our accountancy company, for which separate terms and conditions apply.
