I have recently been put forward for some contract roles through a recruitment agency. The agency have asked me to inquire about either setting up a limited company or using an umbrella company.
Last night i phoned a company called Compare the Umbrella (comparetheumbrella.co.uk). They took some details off me, mainly the recruitment agency i was using and proposed daily rate. The daily rate of the contract is £310 and the guy from Compare the Umbrella explained that i could be taking home £1243 per week based on this rate. My understanding is that Compare the Umbrella are just like a price comparison site (like money supermarket, compare the market etc) He passed some details on to an umbrella company who have phoned me today. A lovely lady rang me and reiterated what Compare the Umbrella said. That i could be taking home £1250+ per week (about £5400 a month) How it would work is that i would be paid a salary of £250 a week on which i would pay tax and NI and the rest would be placed into a loan fund and paid back to me. This umbrella company are called Opus Management. She also said that they have contractors working through the agency i have been dealing with which reassured me. However I did some googling and found an forum post (on here) about them where people have said that HMRC have issued bills for unpaid tax. I got back in touch with the lady from Opus who then called me and assured me of Opus' compliance with HMRC regulations, saying that in 8 years of trading they have only had 10 or so investigations from HMRC, all of which HMRC have been satisfied with. This is out of 1500 contractors they work with. Basically the bottom line is i don't know who i can believe or trust.
I also did some research this afternoon about setting up a limited company. I had an online chat with a very helpful gentleman from Intouch accounting. I told him all my details again and i can't remember the exact figures but he said my annual take home would be approx £61750 for the 310 daily rate. Monthly was about £5147 (about 1188 a week) This was taking into account expenses. I also contacted another company called GiantGroup, they provided similar figures to InTouch. Problem with limited companies though is IR35. What is the likelihood i would be outside that?
Basically what i am asking you good people is for advice for a first time contractor on what is the best way to go. I'd like to be contracting for the foreseeable future. Opus (as an umbrella) wont be affected by IR35 but i have heard some horror stories on this forum about HMRC investigations. Has anyone on here used Opus without any contact from HMRC?