Splitting from Umbrella company Can they take our profits?

[mamas12]

Don't really know if there is anyone out there who can advise.
We have been called in to see MD on Monday with a view to taking this little part of the business over ourselves. He said he would cover our rent etc. and we 'earn' our salaries. Then he said 'up to a certain amount' then he wants our profits! Is he a madman or what or can he do that? Yes I know we will get this looked at,hopefully it will be writing, becasue the meeting is for him to discuss the order of procedure and timescale. But I wouldn't put past him to just want an answer straight away.
I must add that if we don't take it on, then he will close it down and we don't want that obviously.

Will you be spinning out as a separate company? If you are then what he's saying is that he will be a major shareholder (hence will take some of the profits).

If this is the case, he's being quite generous to cover the rent...

It's not a question of 'can they take your profits', it's up to you to negotiate something that works for all of you. It sounds as though he is proposing to sell you part of the business is that right?

If he wants an answer straightaway, I'd say no. You can't take on something like that without thinking about it properly and understanding exactly how it will work and what your responsibilities would be, as well as how profits will be allocated.

Thanks for your replies
Will wait and see what he is proposing