Question: Why isn’t everybody working through an umbrella if it is legal to make more money by paying less tax?
Answer: If you are employed by a company then that company must deduct income tax and National Insurance on all earnings. You can only take advantage of umbrella status because you are not a disguised employee of the agency or client. You are an employee of your umbrella company and you have full and permanent employment. You are legally paid the national minimum wage, tax free expenses and, where applicable, extra salary. You can also claim normal statutory benefits.
Question: Will I have to pay any more tax at the end of the financial year or other later date?
Answer: Only if you are a higher rate taxpayer in which case you should appoint an accountant to prepare a tax return for you.
Question: Will I have to wait longer to get my money?
Answer: No. You are paid weekly and provided the umbrella company receives payment from the agency for the work carried out by you before Friday, our administration support will do the calculations and send your wages, together with your tax free expenses electronically to your account so that you can access your money by close of business Friday.
Question: Will I still get my holiday pay?
Answer: Yes. You are entitled to 28 days of holiday a full year, starting from the first day at work. The umbrella company must ensure you are paid holiday pay at the rate of 12.07% of your hourly rate. As your hours worked may vary from week to week your holiday pay is calculated accordingly. This is paid to you weekly and is shown as a separate entry on your payslip. As you receive your entitlement weekly it is important you put this money aside for any holidays you wish to take. You will not be paid extra when you go on holiday.
Question: What other rights am I entitled to?
Answer: Your contract of employment summarises the basic employee rights and protections under the Working Time Regulations.
Question: How do I claim expenses?
Answer: Simply complete your expenses claim form and submit this to us by 5:00pm on the Monday following the week you are claiming for. Our expenses policy clearly sets out what expenses you can claim for and where receipts are required.
Question: Is there a limit to the expenses I can claim?
Answer: Not as long as all expenses claimed qualify under the tax rules. Our expenses policy clearly sets out what you can and can not claim. You must read and understand this before completing any expense claim form. We must receive a signed form with an original signature in ink together with the original receipts. Note that the umbrella company can only pay your expenses with the money it has available to it. Unpaid expenses are carried forward.
Question: What are the terms of my employment?
Answer: This welcome pack includes two employment contracts signed on behalf of the umbrella company. You will need to sign both but only return one to us. The other is for you to retain, and contains your full terms of employment.
Question: Do I need my own insurance?
Answer: No. As an employee you are covered by our policy, unless you work in a specialist trade where you may need to hold your own. If you have any questions or concerns about this please contact us.