Why use an Umbrella Company?

An Umbrella Company provides a number of benefits to a Contractor, and is an alternative to managing a Ltd Company.

1

Offsetting Legitimate Business Expenses.

The main financial benefit of using an Umbrella Company is the legitimate off-setting of business expenses.  HMRC has strict guidelines about what expenses you can legitimately offset, and in what circumstances but in general terms, if you are at a temporary place of work, and expect to be there for less than 2 years, then the cost of travel to the temporary site, accomodation if you need to stay away from home, subsistence and tools specific to the contractor, are all able to be offset against tax. The Umbrella Company does not re-imburse you these expenses, but by offsetting them against tax it means that this part of your income is treated as non-taxable.  So, for example if you earn £1,000 in a week but have legitimate expenses of £200, then we would pay you £800 as salary (which is liable to Tax and NI as any normal salary is) but the £200 of expenses is non-taxable.

2

No long term financial commitments.

There are other financial benefits to using an Umbrella Company.  If your Umbrella Company doesn’t tie you into minimum contracts (which Simplify doesn’t) then you can use the Umbrella Company without long term commitments to your own insurance policies, yearly accountancy costs etc.  If you set up your own Ltd Company you will need to get insurance in place to cover you while working on the client’s site and to indemnify the work that you do.  If you then decide that contracting isn’t for you, the financial commitment has already been made.  With an Umbrella Company like Simplify, because you “pay as you go” you haven’t got the large outlay if things don’t work out or your circumstances change.

3

Your day to day admin taken care off.

An Umbrella Company will take care of the day to day admin for you, such as invoicing your agency for the hours, offsetting your business expenses, end of year tax forms (such as P60).

4

Flexibility without the hassle.

Whereas with your own Ltd Company you will have to complete Annual Returns to Companies House, submit company accounts, register for VAT and submit VAT returns (subject to turnover), pay Corporation Tax on any profits of the company, complete Self-Assessments etc, with a PAYE Umbrella Company they do all the admin and forward your pay net of PAYE and NI.  This is ideal for contractors who want to keep all the advantages of being a contractor in regards to flexibility, yet don’t want the hassle of running their own Ltd Company.

5

Quick and easy to set up.

As the Umbrella Company is already set up, this means that the process of registering with an Umbrella Company is usually quick and straightforward compared to setting up a Ltd Company with Companies House, setting up company Bank Accounts, and getting insurance in place.  With Simplify Umbrella it takes only a couple of minutes to register using our online registration.

 

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  •       Simplify was a recommendation to me by another contractor. I have found the service excellent and friendly, including giving advice about contracting issues. I would recommend Simplify to others.

    Paul VereyckenCONTINUE READING »

  •       I want to say firstly how much I have enjoyed being with you and your services have been top rate and I will personally have no hesitation in recommending your services to others in the future. Thanks again for you professional and smooth services and keep up the good work!

    Bobby GillCONTINUE READING »

  •       Simplify business provided an excellent service to me in; negotiating contract details, rapid payment and a fast and accurate response to any queries I put to them. Conversations are always pleasant and efficient and my overriding impression is a competently run company whose staff are on the ball and who care about their employees. I'm very pleased to be with them.

    Phil MarkhamCONTINUE READING »

  •       I would like to take this opportunity to say, you have been the best umbrella company I have worked with; co-operative, efficient, friendly and informative. You certainly live up to your name and have simplified business! Your professionalism is very much appreciated.

    Kevin SuttonCONTINUE READING »

  •       Quite simply the best Umbrella agency I have used to date.

    Danielle WilsonCONTINUE READING »

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Tel: 01332 595959
Fax: 01332 650959

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Simplify Business Ltd
St. Peters House,
Mansfield Road,
Derby,
DE1 3TP