As a contractor, your take-home pay is the most important thing to you. You want to know how much you will get in your pocket at the end of the week or month and that you won’t fall foul of HMRC. Luckily, our calculator will give you an instant illustration so you know what to expect – just enter your payment details and click!
How Much could you take home?
Factors that affect your take-home pay.
All compliant Umbrella Companies calculate your pay in the same way. If you see a take-home pay calculation that gives a noticeably higher figure than others, beware! It’s likely the Umbrella is either factoring in a large amount of expenses into your payment or operating a tax avoidance scheme. Although you will see the benefit in the short term, HMRC are aggressively pursuing users of tax avoidance schemes to reclaim unpaid tax and NICs.
The only factor that should affect your take-home pay is the Umbrella Company’s margin. This margin covers all the Umbrella Company’s operations – you should consider the following when looking at the margin:
How am I paid? Some Umbrella Companies offer same-day payments as standard, others don’t and will charge you extra if you want your money in your account the same day they process payment.
Is the margin fixed? Some Umbrellas use a fixed weekly margin, so you know exactly what will be deducted. Others charge a percentage of your invoice value – which can get expensive on higher rates!
What is the service like? Does the Umbrella promise a good level of service and do they actually deliver it? Do they provide a dedicated member of staff for your to deal with, or will you be explaining who you are and what you do every time you call?
Are they compliant? Don’t just take the Umbrella’s word for it – look for awards, accreditations and badges of compliance for peace of mind.
Are they established? A reputable, long-running Umbrella means your money is in safe hands. It is a sad fact that some fly-by-night Umbrella Companies have disappeared along with contractors’ hard-earned money, so don’t take a risk on an unknown operator.
Our award-winning sister company, Contractor Umbrella, are one of the longest-running and most respected names in the industry. If you’d like to know more, visit their website or give them a call on 01206 761 326.
If you think a Limited Company might be a more suitable option, have a look at our Limited or Umbrella guide, give one of our specialist contractor accountants a call on 01442 795 100 or email firstname.lastname@example.org.
Dolan Accountancy was founded by Simon Dolan, one of the most respected names in the contractor industry, with a desire to provide the best contractor accountancy service on the market – bar none!