This kind of information…
Are the relevant authorities happy with umbrella working?
The umbrella system surely wasn’t designed for drivers?
Are you effectively self employed?
Or are you employed by the umbrella company?
What are the pro’s and con’s?
Any relevant information anyone can offer especially from experience would be helpful!
It may have been discussed but up to date information is always good.
global
Not sure how it works as when my agency stopped paye to go with an umbrella i went self employed… the government are closing the tax loophole though so i dont think it will be around for much longer
global:
This kind of information…
Are the relevant authorities happy with umbrella working?
The umbrella system surely wasn’t designed for drivers?
Are you effectively self employed?
Or are you employed by the umbrella company?
What are the pro’s and con’s?
Any relevant information anyone can offer especially from experience would be helpful!
It may have been discussed but up to date information is always good.
global
The taxman is OK with U Cos. In fact the Government is kee to see the creation of new businesses
The umbrella system evolved to minimise tax bill of self-employed people
You are emnployed by the U Co. You are not self-employed
Pro: You can reduce you tax by paying yourself a dividend rather than a salary. See the HMRC website. You are employed and therefore protected by employment laws.
Con: You (the U Co) is just a supplier and payments and liabillities can be challenged (ie you will need public liability insurance [£100] etc
NB you can set up your own U Co rather than going to one of the main suppliers of such services. Have a look at the Companies House website.
What you effectively get with Umbrella is that they charge a fee for processing your payslip (which you wouldn’t normally consider paying for!)
and in return they offset your expenses for tax, some of them incorrectly, because you wouldn’t be happy paying a £27 per payslip fee if you were only getting £20 a week in expenses would you?
If, on the other hand, they stick down £120 a week awarded to you in expenses, and trumpet that they’re saving you £30 extra in income tax, £20 extra in NI, and reducing your “gross to date” figure for threshold purposes, then it “looks” like a better deal…
The problem is, some of those expenses they put you in for are not actually entitled to you as yet, so they are effectively bribing you with some kind of “tax rebate advance” which has yet to be “earned”… What happens if you go “over” your annual estimates? - No tax rebate, all the “expenses money” you’ve already been “paid” throughout the year is now owed back to the taxman…
Umbrella therefore isn’t worth anything unless your BASIC hours put you in the top tax bracket, at which point it really does save you the fortune that it proports to. It’s an instrument for the self-employed on middle class earnings, eg. £18ph and upwards.
BBC employees for example do very nicely out of it, but us mere mortals who’s hourly rates have been marking time for over a decade already?
Forget it. :evil: 
Thanks for the replies, so you have the driver, the agency, the umbrella company and the customers.
Here 
:
employ-e.uk.com/index.php?how-it-works
employ-e.uk.com/index.php?faqs
Plus Employ-E don’t charge YOU for using their service its fee is charged to my agency Grafton, its clearly stated in the website. 
How Does the Umbrella Work?
Surely everyone knows this …
you undo it, push up the middle bit to open it, then you hold it up above your head to keep the rain or sunshine off.
Anyone using a different kind of “umbrella” for another reason other than keeping the rain or sunshine off, is a fool