If you are a contractor, an umbrella scheme offers numerous advantages that can help to simplify your working life. Below, we’ll discuss the reasons these companies have proven popular with contractors, and why you may benefit from joining one yourself.
Benefit #1 – Bureaucratic freedom
Umbrella companies will make your working life far simpler than it has been before. Joining an umbrella company removes the need to register your own limited company – a bureaucratic burden in and of itself – and ensures you do not have to deal with issues such as:
- Submitting RTI returns or VAT returns
- Compiling company accounts
- Managing tax
- Director’s responsibilitiesÃ¢Â€Â¦
- Ã¢Â€Â¦ and many more besides.
The bureaucratic freedom that umbrella companies offer leaves you free to focus specifically on your actual work, rather than your time being taken up by a need to manage paperwork. This is particularly useful for short-term contracting work, as you can get to work quickly – which we will soon discuss – rather than having to go through the time-consuming process of forming a company, then dissolving it when the work is completed.
#2 – Enhanced rights
All compliant and reputable umbrella companies will offer you an employment contract when you join them. This affords you a host of rights and benefits that you would not be able to enjoy if working on a self-employed basis. Specifically, you will benefit from the rights detailed in the Agency Worker Regulations (AWR) 2011, which allow you to benefit from good working conditions, rest breaks, annual leave, and much more besides.
These rights are far preferable to working on a self-employed basis, where there is no provision for any paid leave.
#3 – Quick and easy to register
Umbrella companies make the process of registering as efficient as possible. In most cases, joining an umbrella company will take 24 hours or less to complete. Aside from providing basic information about yourself and your work, you will be required to do very little to facilitate the registration process, so the simplification of your working life commences immediately.
#4 – Manageable fees
When you work through an umbrella company, you will be required to pay a fee for their services. These fees vary depending on the company you work through, ranging from Ã‚Â£5 for a basic service to over Ã‚Â£30 for more comprehensive assistance.
However, most contractors will find that this is a fair exchange, as it affords them more time. Without the need to manage your tax and bureaucratic requirements, your spare time – away from the work itself – will be yours to do with as you please. Furthermore, the enhanced rights to proper working conditions are also well-balanced by these fees; essentially, umbrella company fees are worth it considering the benefits they provide to you.
If you decide to work through an umbrella company, you will find this to be a sound choice, and one that provides improved working conditions and peace of mind. However, it is important to do your research prior to agreeing to work through an umbrella company; read through terms and conditions and seek background information on the firm, so you can be 100% certain you’re signing with a reputable company.