Reply to: how long to get paid?

[inferno]

and the new girls, in my case

Thanks for all your replies. I want to contract for at least the next year so seriously considering setting up my own ltd. Cheers!

[Wanderer]

So basically umbrellas should pay regardless of wether they have the funds from the client, agent or whatever?

No. Umbrellas typically charge about 100/month and they pay you a few days after they get paid.

Agents are different. They pay you (your LTD or umbrella) between 75% and 95% of what they charge the client for your services. In return, the agent guarantees to pay you according to the payment timescale agreed in the contract, even if the client hasn't paid the agency.

Shall I just go ltd?

There is no correct answer to that one. rd409 has summed up the options very concisely.

May I suggest that you do some research (check out the links on the right side of this page) and give it a couple of months to let things settle down then consider your next move. There are a lot of sharp practices out there and they love to catch out the new boys.

[escapeUK]

So basically umbrellas should pay regardless of wether they have the funds from the client, agent or whatever?

Am a bit peeved. Shall I just go ltd?

Umbrellas: Not im my experience. They pay when they get paid.

Yes, you should go Ltd if you think you like contracting and will be doing it for the next few years.

I did my first year with an umbrella, and then created my own company start of this year. I much prefer the control I have over my money, paying zero NI etc

[rd409]

So basically umbrellas should pay regardless of wether they have the funds from the client, agent or whatever?

Am a bit peeved. Shall I just go ltd?

Well there is no straight forward answer to that question I am afraid. Refer to the sticky for options, but quickly summarising it here are your options.

1) If you are contracting for a short time, go for umbrella.
2) If you are contracting for medium to long time, but your contracts would be in IR35, going with umbrella or ltd would'nt be much different. Financially it might be 5-10% of your income. It depends on your personal choice which way you want to go really.
3) If you are going to contract for life time, and can get many contracts out of IR35, and you are happy doing some paper work, and are comfortable thinking like a business rather than an employee; go with ltd option.

There is no one who can answer your question better than you my friend!

[Dearnla]

Am a bit peeved. Shall I just go ltd?

Yes - it's not difficult and you'll be left with more money at the end of the month, in exchange for a bit more admin, like raising invoices and dividends.

[inferno]

So basically umbrellas should pay regardless of wether they have the funds from the client, agent or whatever?

Am a bit peeved. Shall I just go ltd?

[rd409]

I think the Umbrella would care if the agency has not sent them the money seeing as they are acting as the body responsible for working out your tax liabilities, calculating your payment and then making that payment to you...

They have an insurance for situations like that, and guess what? The premium goes from the fees that you pay. This is very similar to the insurance you can take for your limited company, in case the agency or client goes bust and cannot pay your invoices. Umbrella is not just accountants sitting and calculating and making payments. They are a lot more than that as per my knowledge.

[The Agents View]

The agency is on a retainer from clientco with a 30 Day payment period...

No reason for them not to pay weekly here.......

Agency releases cash, agent gets cash, then umbrella, then me. I'm not comfortable with it tbh.

This is VERY VERY dubious. Firstly, the money should be coming from the agency, to your umbrella. The AGENT (as an entity) should have NOTHING to do with it.

Your terms SHOULD be within 14 days of timesheet submitted.

If your agency is not paying up, your umbrella should be (or claiming on their insurance).

overall. Run away!

[Wanderer]

Yes I am. Just checked my contract and it states 'paid two months in arrears or sooner' ?!

That's nasty. Don't let them shaft you like that again, absolute max is 30 days.

[SueEllen]

Yes I am. Just checked my contract and it states 'paid two months in arrears or sooner' ?!

If anyone has recommendations please get in touch!

The agency saw you coming. You should have negotiated before you signed the contract.

[badger7579]

When I started contracting, this was the option give to me.

1) Ltd Company. Agency pays the invoices after 21 days of raising the invoice. So technically, I would receive the money after a month of the work. I dont care if the Agency is paid or not, I will receive the cash for all the approved worksheet. The agency was quite reputed so didn't have issue.
2) Umbrella. Umbrella pays the salary on friday of the same week, that the worksheet was approved. I dont care if the Agency gets paid, or the Umbrella gets their money from the Agency. For this reason, I would have to pay £28 pw.

After consideration of the amount of taxes and other benefits, that I was losing out, I went for ltd company. This is my view (may be very limited, as I am relatively new to this field) of the system.

I think the Umbrella would care if the agency has not sent them the money seeing as they are acting as the body responsible for working out your tax liabilities, calculating your payment and then making that payment to you...

[inferno]

What is the umbrella company? If you are free to choose your umbrella, I am sure there are many on this board, who would like your custom, and will definitely offer you a fair deal.

Yes I am. Just checked my contract and it states 'paid two months in arrears or sooner' ?!

If anyone has recommendations please get in touch!

[rd409]

Thanks for all your advice. The agency is on a retainer from clientco with a 30 Day payment period...Agency releases cash, agent gets cash, then umbrella, then me. I'm not comfortable with it tbh.

What is the umbrella company? If you are free to choose your umbrella, I am sure there are many on this board, who would like your custom, and will definitely offer you a fair deal.

[inferno]

Thanks for all your advice. The agency is on a retainer from clientco with a 30 Day payment period...Agency releases cash, agent gets cash, then umbrella, then me. I'm not comfortable with it tbh.

[rd409]

Errr....Umbrellas don't pay until they are paid in my experience. Agencies however, should be.

When I started contracting, this was the option give to me.

1) Ltd Company. Agency pays the invoices after 21 days of raising the invoice. So technically, I would receive the money after a month of the work. I dont care if the Agency is paid or not, I will receive the cash for all the approved worksheet. The agency was quite reputed so didn't have issue.
2) Umbrella. Umbrella pays the salary on friday of the same week, that the worksheet was approved. I dont care if the Agency gets paid, or the Umbrella gets their money from the Agency. For this reason, I would have to pay £28 pw.

After consideration of the amount of taxes and other benefits, that I was losing out, I went for ltd company. This is my view (may be very limited, as I am relatively new to this field) of the system.