Using an umbrella company is in fact the easiest way to get paid as a contractor. When you register, you become an employee of the umbrella company and they will make your tax and National Insurance Contributions (NIC) on your behalf and you will receive a payslip with a list of the deductions to your salary. All you will need to do throughout your time with an umbrella company is upload your timesheets and receipts (if you are eligible to claim any expenses) to our online portal.
If you choose Churchill Knight Umbrella as your payroll provider, you will have access to a collection of exciting benefits, including your own dedicated Account Manager. You will also receive a fully compliant service from a company that has helped over 20,000 contractors since 1998.
Here is a breakdown summarising the roles of you (the contractor), us (Churchill Knight Umbrella), your recruitment agency and your client:
1. You will be required to complete and return a simple registration form issued by Churchill Knight Umbrella. You will also be required to provide us with documentation including a registration form, proof of identity, your P45 (if available) etc.
2. Your recruitment agency will enter an agreement with Churchill Knight Umbrella and both of us will sign a contract.
3. We will offer you a contract of employment and you will be required to sign and return it to us.
4. When you are working for your client, you will need to complete timesheets and get them signed by the appropriate member of staff.
5. You will then be required to submit your signed timesheet(s) and any qualifying expense claims to your recruitment agency and to us via our Churchill Knight Umbrella online portal. Using our portal streamlines the process and means you are able to carry out your administration in a matter of minutes.
6. When you have submitted your signed timesheet and any eligible receipts on our online portal, we will invoice your recruitment agency according to your timesheets. We will also invoice them for any allowable expenses you are claiming.
7. Your recruitment agency will then raise their invoice and send this to your client. Your client will then pay this to your recruitment agency, in line with the two parties’ payment agreement.
8. Your recruitment agency will pay us.
9. Churchill Knight Umbrella will process the payment we receive from your recruitment agency by making the relevant deductions, including your tax and National Insurance Contributions (NICs).
10. The funds will be sent to you from Churchill Knight Umbrella as Pay As You Earn (PAYE) at the intervals agreed with your recruitment agency. We will send you a notification when your payment has been sent and you will also receive a payslip.
As a contractor, it is imperative you choose an umbrella company that you can rely on and that operates in accordance with all HMRC legislation. Compliant umbrella companies are operating to the same guidelines as one another and will legally make the same deductions to your pay (excluding the umbrella company margin which will vary between providers). Therefore, do not be fooled by some umbrella companies that boast about being able to increase your take home pay because this will almost certainly be a tax avoidance scheme.
Try our take home pay calculator now to find out if we can help you maximise your income.
Our calculator gives you a projected figure and takes into account higher rate tax for limited and umbrella companies and Flat Rate Scheme (FRS) for limited companies.