Top Umbrella Companies in the UK

Probably this is the most important tip of all. Always ensure that the umbrella company you appoint is 100% HMRC compliant. It's easier said than done, purely because, there's no industry standard for umbrella companies. Don't sign up just because your umbrella company if offering you a more take home pay. There may be some hidden negatives.

Always use an umbrella company that offers 24/7 online portal, so you can upload/manage and submit your timesheets anytime and anywhere. Always avoid outsourced umbrella companies, they look fancy but they're always a BIG risk.

A good and reliable umbrella company should be taking care of your insurances, and it should be included in their fee. Insurances such as Professional Indemnity, Public Liability, Employers Liability may be required.

You shouldn't be paying any registration, setup or exit fees. If your umbrella company charges these fees, then you should reconsider using them.

Needless to say, do the math; compare umbrella company fee and service offering with other umbrella companies.

Umbrella company employs temporary workers who work on short-term contracts or assignments. They act as an intermediary between the worker and the end-client or the agency.

Umbrella company directly pays to the employee's bank account after deducting necessary taxes and contributions like PAYE and National Insurance contributions (NIC).

There are over 500 umbrella companies in the UK. The number is on the rise, and it is becoming increasingly difficult for contractors to find a fully compliant, and a reliable umbrella company.

Yes, absolutely. The use of umbrella companies is 100% legal in the UK. A large portion of contractor workforce in the UK use umbrella companies for their contracts.

There is no such thing called HMRC approved umbrella companies or pre-approved or government approved umbrella companies. If an umbrella company says that they are HMRC approved, don't fall for it, they are fake.

No. There is no government regulatory body for umbrella companies. There are membership bodies like FCSA, APSCo and Professional Passport, but there's no regulatory body.

Most umbrella companies are safe, but not all. Some indulge themselves in shady practices and try to lure contractors by promising them a higher take home pay. By using shady offshore schemes, they evade taxes, and in the end, contractors are penalised. Having said that, many umbrella companies are fully compliant and 100% reliable.

It is important to choose the right umbrella company. To find the best one, you need to do some due diligence. To begin with, run background checks on the company you are looking to appoint by going on the internet and reading online reviews. You should also post on Forums and use sites like LinkedIn and Reddit to seek other contractors’ opinion. Ask for a contract and read it in detail. Find out how much they charge and that there are no hidden costs. There should not be any leaving costs/penalties. Always cross-check with other umbrella companies and compare their services. This is how you find the best umbrella company.

There are many benefits of appointing an umbrella company. First and foremost, you don’t have to go through the hassle of setting up your limited company and managing it. This works best especially when your pay rate is low, your administrative burden is taken care of by the company and you can focus on your core work. Depending on the umbrella company you appoint, you may also be able to save more on tax and get benefits similar to that of an employee.

Yes. It is absolutely possible. All you have to do is make sure that all the money owed to you is paid by the umbrella company. Notify them about your decision, you would then get a P45 from them once everything is cleared. Once that is done, you are all good to setup your own Limited Company.

No. No agency or client can force you to use an umbrella company. Whether to use a limited company or an umbrella company totally depends on you.

There are 3. FCSA and Professional Passport provide umbrella accreditations and SafeRec has their umbrella certification.

There is no one particular umbrella company that you can call it as the best. The one that meets and exceeds your expectations should be considered the best.