One of the most time-consuming aspects of running a business is dealing with payment issues. But if your weekends and evenings are being taken up trying to sort out your PAYE contributions, another option may be to employ the services of an umbrella company.
Our Umbrella company services specialize in dealing with outsourced payroll issues. An umbrella company solution means that you are not a director of a company, nor do you carry the responsibilities associated with running a limited company or being self-employed. You are just an employee. Umbrella companies deal with all accountancy and some taxation matters. They can also deal with all administration as well, hence the term ‘umbrella’. Everything is covered by one operation, taking the time-consuming business of bookkeeping and monitoring payments out of your hands and into the hands of our team.
By employing the services of an umbrella company, it also means that any IR35 problems are avoided, as using a PAYE umbrella system means that your income will be treated as though you are an employee.
Using umbrella companies to deal with your payroll issues is easy.
- 1. You complete timesheets.
- 2. These timesheets are then forwarded to the umbrella company and normally the agency.
- 3. Once payment to the umbrella company has been received, a payment is then usually made directly to you.
Since the Managed Service Company Legislation was introduced in the 2007 budget, there is only one choice for an umbrella company, and that is the PAYE umbrella company model. The PAYE umbrella company treats all your taxable income as salary, meaning that you pay employer’s National Insurance payments, employee’s National Insurance contributions and PAYE tax on all your taxable income.
The advantages of using umbrella companies are particularly relevant for small businesses. After selecting your umbrella company, forward your timesheets to them and they will then invoice your agency. As soon as the money is received by the umbrella company, they will normally complete your payroll the same day. Umbrella companies take the hassle out of running a business. By using the services of an umbrella company like Topline Management UK Limited you can significantly reduce your paperwork.
Most umbrella companies also include free professional insurance cover, giving you peace of mind as well as money in the bank. But be careful, as some umbrella companies also have tie-in clauses and can charge a leaving fee if you decide to discontinue your relationship with them. Umbrella companies work on a very strong principle of trust. You have to feel that you can trust your third-party partner to look after your interests for you. Umbrella companies operate as your silent partner, leaving you free to concentrate on your work.
Holiday Pay – We are required by law to withhold your holiday pay which is 12.07% of your wage. This is deducted before tax, held separately and then paid out to you (taxed) whenever you wish to take a holiday. If you finish your assignment let us know and your holiday pay, along with your P45, will be sent to you.
If you would like to know more about how umbrella companies can help you gain peace of mind and give you control of your finances, call Top Line Management UK Limited now and talk to one of our expert consultants.
Topline Management Ltd provide Umbrella services for contractors all over the UK. The Umbrella company option works for contractors who want to have some of the benefits and advantages of operating through a limited company but don’t want to be burdened with the bookkeeping.