Hi all,
I have the classic dilemma that seems to happen when contracting for the first time - do I go ltd., agency PAYE or via an umbrella. I have read the guides on this forum, and I understand the difference between them. I might return to perm work later so not worth setting up own ltd company, and I don't want the hassle.
My question is whether the 'uplift' of my umbrella rate is worth switching to this mode of payment for. As stated in the title with the umbrella, this would be £500 a day vs. £355 on PAYE. It seems to me that the uplift has to be around 15% to generally make this worth doing (the umbrella), and in this case, it seems like it is much more.
I am being offered the choice of going with whatever umbrella I'd like as long as it is FCSA accredited. I have a few on my shortlist, including Clarity Umbrella, whose director I know has been on this forum and is quite reputable when it comes to this topic. The agency PAYE route, however, is still through a company: GIANT. They rang me yesterday to explain and were quite keen to push their own umbrella route. I can understand why, given the margin of £25. I did not like them, they were quite pushy, and explained they could not give me anything in writing before their 'solicitors' would be able to look it over.
They advised that via umbrella my weekly take-home pay is 1382 GBP while via PAYE it goes down to 1199. I believe the umbrella also includes 'rolled-up holiday'. I am tempted to just go via PAYE to avoid adding another person to the chain but the difference between the take-home pay rates is quite large. Is there something I am missing?
Also, other umbrellas (Parasol, DNS - so fairly reputable ones) have quoted me £1450-ish as weekly take-home pay. I am not sure why this is. Shall I try and ring up Giant again to ask why? I have already called them twice and their tone is very salesy and slightly annoyed at having to explain stuff to me. Also, they said they'd ring me back to ask whether I'd go with them through agency PAYE (done by Giant Precision, presumably a subsidiary) or umbrella (done by Giant Business Connect, another subsidiary I assume). If I did do umbrella, I think I'd go with someone who inspired more confidence on the phone.
I guess what I am saying is that PAYE seems safer but I am not sure if I'd be losing out on lots of £. If just losing out on a bit a month, it would be fine. I don't care about pension/investing into a pension (I am not from the UK so not sure if I will grow old here).
Furthermore - on the key documents they have given me, which contain illustrations of breakdowns at £100/day, the umbrella takehome comes out as *less* than PAYE. It almost seems like the documents recommend PAYE, but the agency itself is recommending umbrella on the phone (all whilst saying 'this is just what most people do, I can't recommend things to you'). I definitely don't want things like fluctuating wages etc., so am I right in thinking PAYE would save me all this hassle? And at what cost?
I do apologise if it sounds like I am asking you to calculate stuff for me but I can't seem to work it out myself. A lot of reviews of Giant seem bad, but then again, most umbrellas have lots of bad/split reviews. I have been reading about this for 12+ hours and can't seem to make a decision.
I have the classic dilemma that seems to happen when contracting for the first time - do I go ltd., agency PAYE or via an umbrella. I have read the guides on this forum, and I understand the difference between them. I might return to perm work later so not worth setting up own ltd company, and I don't want the hassle.
My question is whether the 'uplift' of my umbrella rate is worth switching to this mode of payment for. As stated in the title with the umbrella, this would be £500 a day vs. £355 on PAYE. It seems to me that the uplift has to be around 15% to generally make this worth doing (the umbrella), and in this case, it seems like it is much more.
I am being offered the choice of going with whatever umbrella I'd like as long as it is FCSA accredited. I have a few on my shortlist, including Clarity Umbrella, whose director I know has been on this forum and is quite reputable when it comes to this topic. The agency PAYE route, however, is still through a company: GIANT. They rang me yesterday to explain and were quite keen to push their own umbrella route. I can understand why, given the margin of £25. I did not like them, they were quite pushy, and explained they could not give me anything in writing before their 'solicitors' would be able to look it over.
They advised that via umbrella my weekly take-home pay is 1382 GBP while via PAYE it goes down to 1199. I believe the umbrella also includes 'rolled-up holiday'. I am tempted to just go via PAYE to avoid adding another person to the chain but the difference between the take-home pay rates is quite large. Is there something I am missing?
Also, other umbrellas (Parasol, DNS - so fairly reputable ones) have quoted me £1450-ish as weekly take-home pay. I am not sure why this is. Shall I try and ring up Giant again to ask why? I have already called them twice and their tone is very salesy and slightly annoyed at having to explain stuff to me. Also, they said they'd ring me back to ask whether I'd go with them through agency PAYE (done by Giant Precision, presumably a subsidiary) or umbrella (done by Giant Business Connect, another subsidiary I assume). If I did do umbrella, I think I'd go with someone who inspired more confidence on the phone.
I guess what I am saying is that PAYE seems safer but I am not sure if I'd be losing out on lots of £. If just losing out on a bit a month, it would be fine. I don't care about pension/investing into a pension (I am not from the UK so not sure if I will grow old here).
Furthermore - on the key documents they have given me, which contain illustrations of breakdowns at £100/day, the umbrella takehome comes out as *less* than PAYE. It almost seems like the documents recommend PAYE, but the agency itself is recommending umbrella on the phone (all whilst saying 'this is just what most people do, I can't recommend things to you'). I definitely don't want things like fluctuating wages etc., so am I right in thinking PAYE would save me all this hassle? And at what cost?
I do apologise if it sounds like I am asking you to calculate stuff for me but I can't seem to work it out myself. A lot of reviews of Giant seem bad, but then again, most umbrellas have lots of bad/split reviews. I have been reading about this for 12+ hours and can't seem to make a decision.
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