Contractors use umbrella companies as a useful trading vehicle when they are inside IR35 or if do not want to run their own limited company. There are hundreds of UK firms that offer these services, and plenty overseas, so which is the best for you?
Here are five tips to help:
Examine Comparison Websites And Online Sources
There are some online websites providing lists and reviews of suppliers. Websites aimed at freelancers often include adverts to help you find good candidates. Draw up a list that includes your top 10 firms and start researching them. Forums are also useful places to see feedback from other customers. Dont forget to ask people you work with for their personal recommendations.
2: Background, Location And Finances
For each item on your shortlist, find out how long the firm has been running, its location and history. Obtain a credit reference to ensure it is financially sound. If it is based offshore, it may not be an umbrella company at all, but an offshore tax solution.
3: Review The Price And What Is Included
Prices vary from free to ten pounds a week upwards, with many services priced at around twenty five pounds. This is paid weekly, deducted directly from your earnings. Some lower-priced services charge extra for processing expenses and faster payments. So make sure you confirm the price and exactly what you get for the fee.
4: Check Out Compliance
When joining, you should become a full-time permanent employee with a proper contract of employment. You should be told what expenses you can claim and told to keep receipts. If not, then you should be concerned about compliance. A reputable umbrella company will have been audited and is a member of a trade association, demonstrating that they are compliant.
5: Customer Service And Start Times?
You should expect good levels of customer care, including access to an account manager who knows you. Some umbrella companies offer various degrees of online support, some with web-based timesheet submission and expenses forms. If you are starting a contract, you may need a same-day or next-day start. Find out if there are penalties for leaving and any notice periods required. There is a large choice of umbrella company providers, so you dont have to stay with one that does not give you the service you require at a price that suits you.
Selecting an umbrella company supplier can be a challenge for small freelancer businesses, particularly for knowledge workers where time is literally money. However time invested up-front can pay dividends in the long term through savings in fees and better service. BOLA TANGKAS