There are hundreds of umbrella companies in the UK. While choosing one sounds daunting, due to the competition, there are plenty of reliable and compliant providers out there. If you are currently using an umbrella for your payroll and are not satisfied with the level of service you’re receiving, you should consider switching to a new provider immediately. While changing umbrella companies is a little time-consuming, you’ll quickly reap the rewards, and the processes involved are straightforward. This article explains how to switch umbrella companies and when you should consider waving goodbye to your existing, sub-standard umbrella and joining a new one.
Is it worth switching umbrella companies?
100% yes.
With so many umbrella companies to choose from, plenty will provide you with excellent value and compliant payroll. We’ve created a list of essential factors to consider when switching umbrella companies. If you’re unhappy with the service you’re getting, it’s time to make the leap to a new provider, and the following should help you with your search.
Compliance
Choosing a compliant umbrella company is imperative. The repercussions could be severe if you use a non-compliant umbrella, even my mistake (perhaps a tax avoidance scheme). HMRC are continuously increasing their efforts to catch those who engage with non-compliant payroll providers. If you are deemed to have not paid the correct amount of tax or NI, you could be presented with a life-changing penalty.
The Freelancer and Contractor Services Association (FCSA) is the UK’s leading professional body committed to ensuring the supply chain of temporary workers is compliant with HMRC’s rules and regulations. The FCSA offer a prestigious accreditation to umbrella companies that truly value compliance and ethical practices. To earn FCSA accreditation, umbrellas must undergo a series of audits and assessments and prove they adhere to the FCSA’s publicly available Codes of Compliance. Therefore, if you’re looking for an umbrella company you can trust, we recommend you pick one with an FCSA accreditation.
There is also an umbrella company certification from SafeRec – a newly launched payroll auditing company with a state-of-the-art payslip auditing tool powered by Artificial Intelligence (AI). When you pick a SafeRec Certified Umbrella Company, you will receive a payslip audit every time your umbrella processes your payroll. This audit will provide you with a breakdown of your take-home pay and will check that you have been paid the correct amount and that no foul play has occurred. Choosing a SafeRec Certified Umbrella Company puts the power in your hands.
Customer Service
High-quality customer service is vital when using an umbrella company for your payroll because ensuring you are paid correctly and on time is their sole responsibility! Therefore, if you are unhappy with your current umbrella, perhaps they do not respond to messages or never pick up the phone, you should consider moving at your earliest convenience.
If you are not receiving the quality of service you expect, look at the online reviews for your umbrella company. If they are positive, you may be unlucky, and things should improve. However, if you notice that several other contractors are experiencing the same issues that you are – it may be time to say goodbye to your current provider.
Online reviews are very helpful when selecting an umbrella. We recommend you look at Google and Trustpilot, and only pick a new umbrella with reviews that fill you with confidence.
Word of mouth
Word of mouth remains one of the most powerful marketing tools there is. Do you know any friends, family or colleagues using an umbrella company for their payroll? If you do, ask them about their experience with their current provider because hearing someone’s genuine experience with a payroll provider is valuable. If they’re happy, you may choose to register with the same umbrella (but check they are compliant and have a professional accreditation). It’s worth noting that some umbrella companies offer referral rewards for anyone recommended to their service via an existing employee, such as a few weeks with no margin.
Preferred Supplier Lists (PSL)
If you source temporary assignments through a recruitment agency, you will probably know what a Preferred Supplier List (PSL) is. A PSL is a document agencies issue to contractors and freelancers with a list of recommended payroll providers. In some cases, you may be required to use a provider on the agency’s PSL, or you cannot proceed with the role.
Agency PSL’s are usually put in place to protect both the agency and you. There is a lot of complex legislation that staffing agencies must adhere to. By having a compliant and up-to-date PSL, agencies can refer workers to umbrella companies with the confidence that the whole supply chain is operating ethically and the peace of mind that you will be paid compliantly.
Should you decide to take a new assignment via an agency and they require you to switch umbrella companies, it may be an excellent opportunity to seek a new provider that’ll offer you a better all-round service than your previous one. However, if you have always used the same umbrella, but they are not on your new agency’s PSL, speak with your contact at the agency because they may be able to add them to save you the hassle of having to switch.
Is it easy to switch umbrella companies?
Switching umbrella companies is easy, but several steps are involved to ensure that your payroll is not disrupted. Firstly, you need to contact your current umbrella company and let them know you are leaving. They will need to issue you a P45, a document your newly chosen umbrella company will request to ensure that you are assigned the correct tax code.
Considering the points above, once you have alerted your current umbrella, you need to identify a new umbrella company to join. You must complete the registration process after finding your new umbrella.
Firstly, we recommend that you request a take-home pay calculation to check that the umbrella company will pay you accurately and compliantly and there are no signs of malpractice (such as hidden deductions). When you are fully satisfied the umbrella is compliant, it’s time to start the registration process. Usually completable online, this involves providing the umbrella with multiple pieces of personal information that they require by law to welcome you as an employee. You’ll be required to provide your name, address, date of birth, address, National Insurance (NI) number, bank details, assignment information, and more. The registration process shouldn’t take much longer than 10 to 15 minutes.
Next, you must provide your new umbrella company with proof of your identification (passport or Settled Status 9-digit share code). If you are not a UK national, you will also need to provide proof of your Right to Work (RTW) in the United Kingdom (Settled Status 9 Digit Share Code).
Finally, before officially joining an umbrella company, you will be issued a Contract of Employment. This will be a lengthy document full of important information you must read carefully. Once you have read the contract and are happy with its content, sign and return it to your new umbrella company, and the registration process is complete.
There may be some additional pieces of information that you need to understand before you can be paid on time, such as submitting timesheets, etc. Processes are similar between compliant umbrella companies. However, it’s worth speaking with your new umbrella to discover what you must do to be paid on time. At Umbrella Company UK, we have a dedicated Onboarding Department that will support you from the registration process until you are paid for the first time – to ensure that you are 100% satisfied with how our service works and have no unanswered questions.
Join Umbrella Company UK today
Umbrella Company UK is one of the only FCSA accredited and SafeRec certified umbrella companies in the UK. Every week, we process payroll for thousands of contractors and freelancers in full compliance with HMRC’s rules and regulations. We are proud to have earned a brilliant reputation as one of the leading umbrella companies in the marketplace, and our Google and Trustpilot reviews reiterate this.
We take compliance extremely seriously and are delighted to offer all our employees a payslip audit report every time we process their payroll. Thanks to SafeRec, processing the payroll of contractors and freelancers has never been so transparent. As an FCSA member, we have successfully proven we adhere to the FCSA’s Codes of Compliance, and we have successfully had our accreditation renewed year after year, having undergone annual assessments and audits.
To request a free, tailored take-home pay calculation, please click here or call our friendly Sales Professionals on 01707 669023.
