Top Tips for Comparing Umbrella Companies

What to look out for when comparing Umbrella Companies

Because of their growing popularity, hundreds of umbrella companies have popped up in recent times.

Although it’s great to have choice, this can also make it difficult and often confusing for contractors to find the best umbrella company for them. After all, no two umbrella companies are the same.

To find the perfect match for your contracting needs, there are certain factors to take into consideration.

In this guide, Umbrella Supermarket outline our top tips for comparing umbrella companies in 2021, so you can find the best fit for you.

Use an umbrella calculator

The best way to compare umbrella companies is by using our umbrella company calculator.

By simply entering a few key details, such as your day rate and preferences, our award-winning calculator will generate a list of the umbrella companies best suited to you.

Now, you will be able to compare umbrella companies based on the following:

Fees

In return for their services, every umbrella company will charge fees.

However, fees vary from one company to the other and therefore it is always necessary to compare the company’s fees to ensure you get a fair deal.

When comparing umbrella fees it is important to look at how the company charges their fees. Companies can charge fees as either:

  • Fixed fees: this is a set fee which is taken from the contractor’s pay either monthly or weekly.
  • Percentage fees: this is where the umbrella company takes a percentage of a contractor’s pay. This is dependent on how much they earn, so as their earnings increase, so do the fees.

Many contractors understandably prefer the fixed fee option. After all, paying a percentage fee means paying more for the same level of services if you begin to earn more.

Another thing to look out for when comparing umbrella company fees are smaller, one-off fees companies can sometimes charge. These include things like joining fees, exit fees and fees for processing expenses. Although they are often small one-time fees, they still need to be accounted for.

Insurance

Another key factor to account for when comparing umbrella companies is the level of insurance they offer.

As your employer, an umbrella company is required to provide employers’ liability insurance to protect the contractor financially if they fall ill or are injured at work. However, some contractors may require further levels of cover depending on the contract at hand.

It’s always useful to find out whether the company offers public liability insurance and professional indemnity insurance. These are typically a requirement laid out in the contract, however as they are not a legal requirement, it’s always useful to check whether the company offers them as part of their services. Otherwise you may have to bear the cost yourself.

Some contractors require other types of insurance depending on their industry and role, so it’s always best to check whether the company can cater to your needs.

Payment terms

Payment terms are a significant factor to take into consideration when choosing an umbrella company, and there are many important questions surrounding the issue.

Every contractor wants to know exactly when they will get paid and umbrella companies provide different payment options from daily, weekly, fortnightly to monthly. Clearly, different contractors will have different preferences, so it’s important to find a company that caters to your needs.

Another factor to take into consideration is how easy it is to get paid.

Every contractor knows the importance of getting paid on time which is why it is important to avoid companies that force you to jump through loopholes to submit timesheets. Additionally, it is important to look out for any indications of payments being delayed, such as requirements for timesheets to be signed off.

Finally, always look out for any red flags.

Steer clear from umbrella companies who claim to offer you a more ‘tax efficient’ way of working. This this is not possible due to the fact that every umbrella contractor pays tax through the PAYE system.

Some companies will offer to split the contractor’s salary into 2 or more payments, with just one payment going through the PAYE system, pay via a capital advance agreement or make payments through an offshore structure in order for you to pay less tax.

This will in fact do the contractor more harm in the long run as you are liable for your own tax responsibilities.

Reputation

The final factor to look at when comparing umbrella companies is their reputation.

No contractor wants to work with a company with a poor reputation, which is why spending time researching companies and looking at reviews is key.

Though a simple online search you can find out important credentials such as how long the company has been operating, the number of contractors they have worked with, what reviews they have received, if they have any history of working with contractors in your sector and if they have any other accreditations that can boost trust.

Find the best umbrella company for your needs with the help of Umbrella Supermarket

Now you know exactly what to look out for when comparing umbrella companies, why not try out our handy umbrella calculator to find the perfect company for you? Using Umbrella Supermarket’s award winning comparison tool, we will generate a list of the best companies catered to your specific needs in just 2 minuets.

If you’re ready to see what our umbrella calculator can do for you in 2021, simply start by entering a few key details and we will do the rest. Thousands of contractors are moving to umbrella companies, are you?

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Using an Umbrella Calculator

The Pros of Using an Umbrella Calculator

There are many advantages to using an umbrella calculator for contractors.

Umbrella calculators allow you to quickly compare thousands of umbrella companies across the UK, offering a clear overview of what you will receive from the company, including everything from your take-home pay, what benefits you will receive, and what services the company will offer.

To help contractors find out more, Umbrella Supermarket outlines the main benefits to using an umbrella calculator in 2021.

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Umbrella vs Limited Company: What to know when making the move this new tax year

The 6th April 2021 marked significant changes to IR35 legislation which impacted thousands of self-employed, limited company contractors operating within the private sector.

In light of the changes that have now rolled out, many limited company contractors are understandably considering their options and thinking about making the move to umbrella this new tax year.

To help make the decision that little bit easier, in this guide Umbrella Supermarket outline what contractors need to know about making the move from limited company to umbrella in 2021, to help you get on the right track.

 

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Umbrella Company vs PAYE: What should you choose?

Umbrella company vs PAYE is a question asked by thousands of contractors.

After all, it’s a big decision to make that will have a direct impact on your contracting career and day-to-day life, so it’s not one that should be taken lightly.

To help every contractor make the right decision for them, Umbrella Supermarket has put together this insightful guide outlining the key differences between umbrella and PAYE and the advantages and drawbacks of each.

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How can I avoid IR35?

As a contractor, you will most likely know about IR35 and upcoming reforms from April 2021.

These changes to IR35 legislation are set to badly impact many self-employed contractors in the private sector, so thousands are understandably worried. After all, getting caught out by IR35 can mean you end up paying more in tax than you need at the same level as an employee, without receiving the benefits of being employed, such as statutory rights.

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Umbrella Company Fees: How Much Should You Pay?

When deciding which umbrella company to work with, the fees they charge will inevitably play an important role in the decision-making process.

Umbrella company fees are taken directly out of the contractor’s income, so it is only natural that contractors want to ensure they are getting a fair deal.

To help contractors understand umbrella company fees, from how they are charged, what they will receive in return, and how much they should be paying, Umbrella Supermarket outlines everything there is to know about umbrella fees in this handy guide.

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Pros and Cons of Limited vs. Umbrella

Big reforms to IR35 legislation are set to come into motion from 6th April 2021 which will impact the thousands of self-employed, private-sector contractors out there.

For this reason, many of the contractors that currently operate through a limited company will be considering the umbrella company route as an alternative.

If this is true for you, it’s important to do your research to find out whether limited company vs umbrella is the best option for you in 2021.

To help make the decision that little bit easier, in this guide Umbrella Supermarket outline the key differences between limited vs umbrella, so you can get on the right track.

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What Does the 2021 Budget Mean for Contractors?

On 3rd March 2021 Chancellor Rishi Sunak unveiled his Budget in the House of Commons, outlining the government’s tax and spending plans for the year ahead.

Sunak announced a variety of measures he will put into place to help businesses and jobs that have suffered through the pandemic, as well as outlining a plan for the long-term recovery of the economy.

However, the question many contractors will be asking is how the Budget will impact the

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5 Benefits to Working with an Umbrella Company

Contracting through an umbrella company has become an increasingly popular option for contractors across the UK in recent years. After all, it is a route that offers contractors a range of benefits over other paths such as working through PAYE or being self-employed.

 

 

ir35 reforms

Contractor’s Guide to IR35 in 2021

From April 6th 2021, reforms to IR35 legislation will come into force, impacting the lives of thousands of self-employed contractors.

Inevitably, contractors across the UK are concerned about upcoming reforms and how these will affect them. To help, in this guide, Umbrella Supermarket look at what these changes to IR35 entail and how they might impact you as a contractor in 2021.

 

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How to Compare Umbrella Company Fees

If you are considering joining an umbrella company in 2021, or have been contracting through one for a while and want to ensure you are getting a good deal, it is important that you know how to compare umbrella company fees.

What you pay in income tax and National Insurance will be the same regardless of which umbrella company you choose, however the fees the umbrella company charges can make a big difference to your take home pay.

At Umbrella Supermarket, we know that every contractor wants to get a fair deal. To help, we explain how umbrella company fees work and how you can compare them to find the best deal.

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Job Retention Scheme for Contractors in 2021

The COVID-19 pandemic has impacted workers across the UK and contractors have been no exception.

Many of the 1.77 million independent contractors have either lost work altogether or have had contracts put temporarily on hold leaving them in a tricky position.

Fortunately, many of these contractors are eligible for the government’s Job Retention Scheme otherwise known as furlough, introduced to offer financial support for businesses and workers. This has been an essential source of income for many who have lost contract work as a result of the pandemic.

As we experience a third national lockdown, the furlough scheme has now been extended until the 30th April. So, if you find yourself out of contract work or have projects on hold, Umbrella Supermarket are here to explain what the Job Retention Scheme is, how it works and what this means for contractors.