Umbrella company

[llyh]

Hi there,
I'm 3 months pregnant and have been offered a 6 month contract role but I'll need to use an umbrella agency. I have no experience with these agencies as have always been employed by my company before. Can anyone shed any light or advise.

Many thanks

Is it through a recruitment agency? If so, they should have a preferred supplier list of pre-vetted umbrella companies (like Paystream) for example that they can recommend.

They gave me a list of 3 but they all seem to have terrible reviews.

They probably have terrible reviews because they take a cut of your money for doing not very much except dragging you in to a web of tax avoidance.

They claim to 'employ' you but don't fulfill any of the normal functions of an employer, and many certainly weren't interested in their responsibilities when COVID hit and they should have been furloughing their workers and helping them get paid when they couldn't work.

When you say you were 'previously employed by your company' do you mean you are a director of a limited company, or that you are usually a standard employee who works for a standard employer?

Will you be legally employed or self employed?

www.gov.uk/guidance/check-employment-status-for-tax#worker

Is there any reason why the company you're ultimately providing the service to can't employ you on a standard employment contract but for a 6 month temporary period?

Be very careful! There are some proper umbrella companies, but a lot of rogues. The rogues will suggest that your taxes are taken care of through PAYE, but not deal with it properly, and you only find out when you get a letter from HMRC saying that you've been involved in tax avoidance, here's a big bill. There is excellent information and advice on how to find a good umbrella company on the Low Income Tax Reform Group website www.litrg.org.uk Put Umbrella in the search box. Good luck!

I used to head up a department at one of these umbrellas companies and would advise you to steer clear. They’re money churners and have no interest in making sure your paid correctly

Have at look at Danbro. They're an accounting firm who specialise in contractors and also have an umbrella company. They're highly rated. I've used them several times in the past and they're excellent, very reputable and helpful.

🙄 it's not tax avoidance.

If you're a contractor working inside IR35 then working through an umbrella company is standard and completely legitimate. Which 3 companies have you been given?

I'm current using Parasol (almost 6mths now) and have had a very positive experience. Very easy to use, they explained everything from the start. Never had an issue with being paid on time It was all very smooth. They offered the first month free and then their fees after that were reasonable. I would use them again!

I just checked out Danbro but their recent Google reviews are pretty bad. It seems so crazy that so many ppl have bad experiences but big companies that insist their contactors use them don't care.

On Trust Pilot Danbro are rated Excellent with 4.7 out of 5.

I'm an accountant myself (ex Big Four) and work in Financial Services and was always very happy with them. (Some of contracts insisted I used an umbrella).

Danbro are one of the best IMO, I’ve worked for two won’t say the names and this is rated highly in umbrella world

OK interesting. I'd been talking to paystream but will look into Danbro. Thank you

FWIW DH has been a contractor for just over a year with PayStream and never had any issues.

All money-grabbing bastards.

Umbrellas companies
All the disadvantages of employment with all the disadvantage of being self employed.

I’ve used clarity umbrella for 6 months and found them easy to deal with, very fair and transparent. Happy to recommend them

I run a small umbrella company that’s fair, I started it because of the horrible experience my sister had using one.

pm me, if you’re still looking for one.

Unfortunately there are some umbrella companies about who do play fast and loose with the rules, especially in relation to tax. However there is far more scrutiny on Umbrella companies now and there are a few ways to identify compliant ones.

Check out this article here: Choosing the Best Umbrella Company - Danbro Umbrella and be sure to always check that whichever umbrella company you choose is accredited by the FCSA.

I’ll suggest everyone watch out for members of FSCA too because most of the umbrella companies ttat was not abiding to rules were their members, for example tte one my sister used.

There are some of their members withholding holiday pay too, so, do not just rely on them to look after you, they mainly look after their fee paying clients, that is, the Umbrellas themselves.

I'll look at the reviews for my old umbrella and if they're good then will PM you the details. I found them very good.

I concur. I've been an accountant in practice for 40 years. Danbro are one of the few "good guys" and have been around a long time, with a generally good reputation, unlike a lot of the "here today, gone tomorrow" firms who take your money and run and leave you to pick up the pieces. I often recommend Danbro to clients/potential clients who need an umbrella company rather than run their own limited company (and, no, I don't earn commissions etc!!).