Umbrella Companies, AWR,Agency Workers Regulations | Crunch

umbrella company

Umbrella Companies

Many Contractors choose to use the services of an existing ‘Umbrella Company’ – they are limited companies that employ Contractors. If you choose to do this, your contracts will be treated for tax purposes as if they are all inside IR35 .

Umbrella companies deal with the payroll aspect of your employment and all your accountancy and tax issues and employ you (the Contractor) on a PAYE basis (called an ‘overarching’ contract). Rather than being paid directly by your clients, your payment will be processed by the Umbrella Company. You submit a timesheet, including expenses details, to the Umbrella Company, who bill the client.

The Contractor has an employment contract with the Umbrella, and the Umbrella holds the assignment contract with the agency or the client. Certain expenses (travel and subsistence) can be claimed that can reduce your tax bill ... http://auto-insurance.ucoz.com/news/umbrella_company/2013-06-22-4064