Independent contractors are often faced with the challenge of properly determining their working structure. They would need external service or support to take care of the administrative tasks which take a lot of time. The best solution for this dilemma is to seek assistance from an umbrella organization.
What Is An Umbrella Organization?
An umbrella organization partners with independent contractors and gives them temporary projects or workload. After completing the registration process, the contractor then becomes an employee of the organization. The company will take care of the invoice to be sent to the recruitment agency.
Umbrella companies will also handle applicable deductions and other admin tasks that are part of the contractor’s duty. This means that the contractor will be able to focus on their workload and just leave the paperwork to the umbrella organization.
Top Reasons Why Contractors Work Under An Umbrella Organization
Umbrella companies will help contractors save time in dealing with admin tasks. They will also take care of all the necessary requirements that come with hassles when a contractor is managing a limited company. All sorts of admin and financial matters are handled by the umbrella organization.
The umbrella organization will take care of important back-office tasks such as filing VAT returns, financial software, accounts management and payroll management just to name a few. In return, contractors can save money and time from dealing with such factors.
Choosing The Best Umbrella Organization
Here are the questions that contractors must ponder when choosing an Umbrella company:
- How much are the fees of the organization?
- Is the company tax compliant?
- Do they have extensive experience in the industry?
- How fast do they process the contractor’s payment?
- Do they offer additional services at reasonable costs?
As an independent contractor, it is very important to take all the time to research on umbrella companies to ensure that you will end up with the best organization that can take care of your admin needs.
Most of these umbrella companies can be researched online and contractors can also get much needed information such as reviews from actual clients. This will help them make a well-informed decision that can also solve their limited company challenges.
There are several online resources that allow contractors to get information on umbrella companies such as their track record, reviews, rankings and other pertinent details. Contractors can also get referrals from their colleagues which can help them decide.
How Much Does Their Service Cost?
There is no standard rate for umbrella companies but they typically charge starting at 12 pounds or up to 25 pounds weekly depending on several factors. There are some umbrella companies that may charge the contractors on a monthly basis but this would depend on the terms outlined in the contract.
Take the time to research on different umbrella companies and see what they can offer. This will guide contractors to the right company that offers the services that they need but at a reasonable rate.