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As a contractor, there are a number of ways in which you can operate, but two key choices are: through your own limited company or under a PAYE umbrella. Both options offer a number of pros and cons depending on your experience, the length of time you intend on contracting and the level of time you have to dedicate to paperwork.
To better help you understand your options and which route is best for you, we’ve put together our handy downloadable guide and video.
Watch our brief LTD vs PAYE Umbrella video, then get more detail on what structure is best for you in our FREE guide.
Contracting under your own limited company means that you will be in charge of your accounts, your salary and your taxes. You will need to establish your limited company and open your business bank account.
As the limited company director, you will control invoicing, the company bank account and decide on how much to pay yourself, which is made up of a combination of salary and dividends.
Working under an umbrella company, on the other hand, means that this will be the responsibility of your umbrella company who will act as your employer.
You submit your timesheet to your umbrella company who will then pay you a salary with National Insurance and tax already deducted.
Both structures come with their own perks depending on your circumstances. However, becoming a limited company director does give you the following:
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Appointing an accountant can save you time and stress when starting up on your own. If you would like to speak to someone about any of the above information or any other queries you may have, arrange a callback and a member of the team will be in touch.