Six important things to consider when you make your decision
When you appoint an umbrella company to handle your tax and business administration affairs you also trust them with your livelihood. So how can you be sure that your umbrella company is reputable and will always act in your best interests?
While many umbrella companies offer ethical, quality, compliant services it is also the case that a small number of companies have given the sector a bad reputation. The fly by night operator who disappears one day and is back with a different business name the next might offer incorrect advice which could have serious financial implications.
For more than a decade Exchequer Solutions has provided business services to contractors throughout the UK and Europe, offering guidance and practical support. Here are our six tips for contractors to consider when appointing an umbrella company.
1. EXPERIENCE
Experience and reputation count. An umbrella company should have a wealth of specialist knowledge and be able to offer you advice which is compliant and protects your business interests.
2. PERSONAL AND RESPONSIVE SERVICES
Time is critical whenever you need to check a payment or regulations. If you work abroad, or travel extensively, then you need easy access to reliable and accurate information and the last thing you need is lengthy online registration and submission systems.
3. GUARANTEED PAYMENT DATES
As a contractor you need to be confident that correct payments will always be made to you on the due date. At Exchequer Solutions we make payments into the nominated bank account each Friday and will send a text message each Thursday to advise you of the amount to be paid.
4 .CUSTOMER FOCUS
Ask your umbrella company the questions that matter to you: are they reliable, accurate and responsive? Feedback and word of mouth recommendations on social media, such as Facebook or LinkedIn, can reveal a great deal. Or ask other contractors for their recommendations.
5. HOLIDAY PAY AND EXPENSES
Like any employee you are entitled to certain benefits such as holiday pay. With an umbrella company you can usually choose to take your holiday pay in one of two ways: retained or rolled up. With retained holiday pay we “save up” your holiday pay up for you. You can then claim this back when it suits you. This option works well if you want to be paid when you take your holidays. With rolled out holiday pay you will receive your holiday pay automatically along with your weekly pay. With this option you won’t be paid when you take holidays as you have already been paid a supplement for your holiday entitlement.
When it comes to expenses, reputable umbrella companies insist on receipts for most expenses as accurate and up to date paperwork is essential for official purposes. We do allow mileage and food expenses without receipts but not other items. It is wise to be cautious if it is ever suggested that your receipts are not needed!
6. TRANSPARENT MARGINS
Check contracts carefully for hidden costs and details of any upfront or exit costs.
While the right umbrella company can streamline your business affairs, the less reputable companies can create problems. By taking time to consider what you need most from your umbrella company and carrying out background checks you can minimise the risks and reap the benefits that an experienced and ethical umbrella company can provide.
Click here for more details about umbrella services offered by Exchequer Solutions
