Wages dilemma-Ltd or umbrella co

OT007

Hi
I'm with an agency and in order to see a decent amount of my wages I am required to go Ltd Co. or else use an umbrella company which takes a lot of my income per week.
My question is which finance company is best to use to process my payroll admin or is it something I can do myself, i.e. invoice the agency which I'm hoping they won't dispute; then use an accountant at the end of the financial year re. HMRC requirements?
I have been recommended a finance company however they also want £35 +VAT per week to process my expenses and payroll admin plus they are insisting I open a business bank account...
Can anyone please advise me with any options

Glass_Half_Empty??

Do it yourself!
Don't pay these filthy low life umbrella companies all the info you need is on here and gov site. Might be worth looking for an accountant to have a brief chat with but you can do it all yourself.

OT007

Oh ok thanks!
I'm new to this site so I was having trouble finding which section to get the information from...

PasturesNew

Given the choice I'd go with an umbrella - there are plenty of affordable ones out there.

Setting up a Ltd company and getting the paperwork right can be a right royal pain.

As your intention is not to "set yourself up in business for life" then go down the umbrella route - you can always change your mind and change to a Ltd company in a year or two if your motives change.

Umbrella = easy in, easy out of this employment situation. A carefree way of managing the paperwork side of things and, should the worst happen, a P45 can be issued to you and you can sign on.

Ltd = harder to manage and if you lose the contract it's then harder to go down the dole route.

In these situations, it has to be Ltd or umbrella, you can't simply "go self employed, issue invoices and DIY". It has to be one or the other, proper/formal.

Ebe_Scrooge

PasturesNew, I have to say I take the opposite view. I work as a freelancer, as do many of my colleagues. I chose to go down the Ltd Co. route. Setting up the company was a doddle via the Companies House website, and all you need to is keep receipts etc. and records of income and expenses. At the end of the year, I just hand the whole lot over to my accountant, and he does everything, submits accounts to HMRC etc, and then I get a tax bill. He charges approximately half as much as what my colleague pays to his ( frankly hopeless ) umbrella company for doing the same thing.

The only advantage to an umbrella company is that they will do a PAYE type tax arrangement, so you pay tax each month, rather than having a big bill at the end of the year. But having said that, it's very simple to estimate what your tax bill is going to be. I just put aside money each month to cover this into a separate account, which earns a little bit of interest. Then when the tax bill arrives I just pay it with no problem.

Hope this helps.

OT007

yes it does help very enlightening
thanks

motorguy

Ebe_Scrooge wrote: »

PasturesNew, I have to say I take the opposite view. I work as a freelancer, as do many of my colleagues. I chose to go down the Ltd Co. route. Setting up the company was a doddle via the Companies House website, and all you need to is keep receipts etc. and records of income and expenses. At the end of the year, I just hand the whole lot over to my accountant, and he does everything, submits accounts to HMRC etc, and then I get a tax bill. He charges approximately half as much as what my colleague pays to his ( frankly hopeless ) umbrella company for doing the same thing.

The only advantage to an umbrella company is that they will do a PAYE type tax arrangement, so you pay tax each month, rather than having a big bill at the end of the year. But having said that, it's very simple to estimate what your tax bill is going to be. I just put aside money each month to cover this into a separate account, which earns a little bit of interest. Then when the tax bill arrives I just pay it with no problem.

Hope this helps.

One thing we dont know is if this is a short term or long term direction for the O/P.

If its just for a few months until they get permanent work, then i wouldnt recommend going LTD.

I also suspect the O/P isnt getting "contract" rates, so justifying the cost of an accountant to manage limited company accounts could be a large overhead.

RE: umbrella companies, there are companies who only charge £15 per week, and will process your expenses, sort out your PAYE etc.

motorguy

Glass_Half_Empty?? wrote: »

Do it yourself!
Don't pay these filthy low life umbrella companies all the info you need is on here and gov site. Might be worth looking for an accountant to have a brief chat with but you can do it all yourself.

Might not have any choice in the matter. A lot of contracts want to pay either a LTD company or an umbrella company.

LowGear

I'm with an Umbrella company that charge £11 per week but, in the last two weeks due to the budget I've been paying the Employers NI as well and this has increased my stoppages big time, I'll be better off on the companies PAYE scheme and claim expense.

brollyologist

Hi

[x-posted to jobs/jobseeking]

I need to get set up quite quickly with a contractor umbrella to work with a client who doesn't take sole traders. I've used one in the past but became dubious about their methods, so this time I want to be completely sure the company is fully above board.

For this reason I have mainly focussed on the bigger brollies that have a higher profile, but I'm happy to receive any other recommendations here.

Currently I am comparing two of the best known I'm aware of, which are Giant and Parasol. Both seem competitive in the take-home pay they're able to offer. Would anyone strongly recommend one over the other (or a different one entirely)? Also anyone use Blue Intellect? I've had one rec for these guys although they're a bit smaller.

Setting up as a limited company probably not an option for me btw, as I work quite short stints and can't guarantee the situation will not be quite temporary.

Many thanks

Makkusu

Hi Brollyologist,

If you're looking to go Umbrella route I can personally vouch for Parasol, if considering Ltd they also have ClearSky Accounting and several branches across the UK. I believe they offer a free call so it's of no loss to have a chat.

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