We hope this page will tell you everything you will ever need to know about using  Umbrella Companies

1. Contractor Umbrella Overview
   
   This is where you 'the contractor' essentially become an employee of the umbrella company. You submit time-sheets to the umbrella (often via your agency) who will in turn, invoice the end client (or agency) for the work done by you. You will then be paid as a PAYE employee less the umbrella fee. Any travel to work and meals while working costs are tax deductible.


2. How do Umbrella Companies work?
   
   The steps below illustrate what takes place between umbrella companies, recruitment agencies and end clients:
   
   
   • The umbrella company will sign a contract with your recruitment agency
   
   
   • You will sign an employment contract with the umbrella company.
   
   
   • You submit both timesheet and expenses information.
   
   
   • The umbrella company will invoice your agent/client for the work you have done.
   
   
   • The umbrella will receive funds for you from the agency.
   
   
   • You receive your money less tax, NI contributions and the Umbrella services fee and your umbrella company will send you a payslip just as with permanent employment.
   
   


3. Contractor Umbrella - Take home pay
   
   The key question on all Contractors’ minds is 'how much will I earn / take home'? You'll typically take home anywhere between 60% - 65% of your contract value through a contractor umbrella, although this depends on the level of expenses you claim for.


4. Expenses using a Contractor Umbrella
   
   By claiming all appropriate allowances and expenses you can minimise your tax bill; however, this is not a way of avoiding tax- it is a legitimate way for temporary contractors to recover some of the costs they incur in finding work.