PAYE or umbrella company?

[holidaysarenice]

Can anyone help with advice as to which i should do?
im about to start with a locum post for about 3 months. i havent had any income since april this year and probably wont earn enough to pay tax.

as i understand it the pay is x, the locum agency can do it paye and pay x- (about 3.50) or i can use an umbrella company? What should i do/what is the difference?

does it matter that i havent paid tax? if i go with paye will the locum company still take the same amount off, (it appeared so) thus meaning the equivalent of me paying tax but i wont earn enough?

thanks so much!!

Anyone?

holidaysarenice what is your plan after the locum post is complete?

If you are paid by the locum agency then they will calculate your pay on the basis of your tax code and your most recent P60 or P45.

An umbrella company will do effectively the same thing (you are employed by the umbrella company).

As this is only a short-term situation then it is likely that the tax will be calculated using an emergency code. So short-term you will get tax deducted either way.

If you were planning to locum long-term then the advantage of an umbrella company approach is that out of pocket expenses (travel to work, your Greggs sandwich lunch) are tax deductible.

Both the locum agency and the umbrella company will charge a fee for their services.