Using Umbrella Company - what to factor in when comparing to normal paid employment

[Maggiethecat]

Considering offering services via Umbrella Co (rather than private Co) so PAYE, NI will be taken off. In order to compare annual gross salary with what I'd get from 'normal' employment am I just factoring in private pension costs?

So £x - £pension = annual salary comparable to 'normal' salary?

Is there anything else I should be factoring in?

If you use an umbrella company your rate with the client will also need to cover Employer NI and also annual leave. Both of these will be actual deductions before you are paid each month, the holiday pay component you obviously will recoup when you take leave. You might want to also consider sick leave and other benefits that you might have got if you were employed directly by the end client.

Of course! forgot about sick leave.

They've provided calculations with holidays accrued rather than advanced and factored in employer NI.

The headline annual gross salary looks very good but I realise the need to look carefully at what I'm comparing.

Why are you doing it this way rather than employment?
Of course it depends but DH was offered a contract for £650 per day last year and we were given the calculations for going via an umbrella and it came out at under £400 per day. He works through our own ltd co instead and due to several safeguards we are not subject to IR35

Flexible working.

Lots of our clients will no longer accept contractors outside ir35 - they don’t care about individual cases it’s a blanket rule.

Remember to factor in the lack of stability in employment. In my work sector I look for a headline figure of 2.5 to 3 x annual salary. So if a normal salary is 40,000, I'd be looking for 545 a day (120,000/220 days)

True
DH doesn’t take contracts inside but he’s fortunate enough not to have to as there are still plenty in his field that aren’t

@PoolSquid - I think my area might have a lower factor but I note what you say about unstable employment.

So much more to consider than the headline salary.

I'd speak to an accountant and get their professional advice on what would be the best way to proceed, and based on your circumstances.

Will do

Becareful, if offered any medical trials,

Won’t be doing any!!