Umbrella company vs Ltd company

jungle_jane

I've done both and prefer Ltd company. But that's because all my work is outside of IR35 - if it wasn't i would certainly use an umbrella company. Its wayyyyy less hassle than administering inside-IR35 contracts and you can still deduct expenses.

There is a lot to learn when you first go contracting. Starting with an umbrella company while you learn the ropes is a good idea. I made a right hash of a Ltd company when I first started then I went to the Umbrella for a year and only at that point felt that i understood enough about the tax system, contracting, expenses etc to go on my own. You have to have a lot more discipline as a Ltd company (to regularly administer your receipts/expenses etc) and Umbrella companies help you to get into this gradually. You have to submit detailed expenses to get paid out for them and therefore this helps you start getting into the rhythm