Umbrella Company for Public Sector Workers
With the changes in legislation affecting Public Sector Workers (April 2017), it has become increasingly common for contractors to operate using an Umbrella Company. Find out more about using an umbrella company for public sector workers.
Using Umbrella Company UK you can be confident that you will receive a preferential service that will make your life much easier. The set up process is quick and easy and you can be set up and ready to be paid on the same day. Payroll is also run the same day your wages are received by your end-client or agency*, which means that you can get paid faster!
With the burden off your shoulders, you can focus on your contracting roles and any free time you get you can enjoy it to the maximum.
What does public sector reform mean for me as a contractor?
Due to IR35 reforms for public sector workers, some contractors are believed to have lost 30% of their income. This certainly has not been a popular change and has caused many contractors to feel a huge amount of uncertainty towards their futures in the public sector. It is now the responsibility of the end-client to decide whether IR35 applies to an engagement, and most tend to err on the side of caution to avoid being interrogated or fined by HMRC, regardless whether IR35 does in fact apply.
For example, the NHS previously chose to use a blanket strategy that automatically put contractors inside IR35. This however is against Government guidance, which indicates that end-clients should be making individual assessments case-by-case, and avoiding blanket decisions.
What are the benefits of an umbrella company?
Below we have compiled a list of the benefits of using an umbrella company for public sector workers:
- It is the easiest and most hassle-free way to operate as a contractor.
- Minimal administration – you are only required to submit your timesheets. The rest will be sorted for you, saving you time dealing with payroll or tax/National Insurance payments
- Sign up is simple, and can be completed the same day within a couple hours.
- It’s an ideal option for contractors who are on short-term contracts (under 3 months), are new to contracting or are unsure how long they will be contracting for. There is also is no tie-in period and leaving is simple if you wish to do so.
- There are no unpleasant surprises as there are no hidden fees, or fees for joining or leaving.
- You are still entitled to employee benefits such as Statutory Sick Pay, Annual Leave, Maternity Pay and Paternity Pay.
- Insurances are inclusive. Umbrella Company UK provides £10 million Employers Liability Insurance, £10 million Public Liability Insurance and £5 million Professional Indemnity Insurance. This can be tailored for you if you require a higher level of insurance.
Why have the public sector changes occurred?
HMRC believe that there were many contractors operating outside IR35 that in fact should have been classified inside IR35, and therefore taxed like a regular employee. When the responsibility falls on the end-client to make an IR35 assessment, more care will be taken to reach the correct result. As such HMRC will be able to recoup the tax and National Insurance it is due from contractors who work similarly to regular employees.
How can Umbrella Company UK help you?
Here at Umbrella Company UK we can offer you a free consultation that will allow you forecast your take home pay through an umbrella company. Our illustrations will clearly identify your take-home pay with National Insurance Contributions, income tax and our margin included based on your rate of pay and hours worked. An umbrella company for public sector workers like Umbrella Company UK is an ideal payroll option because there is no risk that HMRC will come knocking.
Please contact us using the form on this page to find out if we can help you with your PAYE. Alternatively, please call our professionals on 01707 669023.