Limited or Umbrella - is it right for me?

Click here to read our Ultimate Quick Guide on 'limited company or umbrella company' which includes a full review of both PAYE Umbrella and going Limited plus advantages and disadvantages of both ways of working plus read our new page: Take home pay Limited company or Umbrella company.

However, if you earn less than £25k or are on a short contract and don't intend to stay contracting for long, then maybe an umbrella service would be best for you.

Ultimately, the decision it is up to you; working through an umbrella company is simpler than working through your own limited company but you will take home less money from your contract.

Click on the links below to read our other umbrella guides:

RMI Accountancy provides Umbrella Company Services to contractors and freelancers through it's sister company ContractorUmbrella.

ContractorUmbrella Ltd

ContractorUmbrella is part of the RMI Accountancy group and was formed in 2002 to provide employment services to UK based contractors who do not wish to operate through their own Limited company.

They are also the first umbrella company to be fully compliant with all Managed Service Company (MSC) and debt transfer legislation, as reviewed by KPMG. This is important as many other umbrella companies claim to be HMRC compliant - but can they prove it? ContractorUmbrella can, read KPMG's review.

ContractorUmbrella is an alliance partner of Contractor UK, Contractor Money, FreelanceUK and is an associate member of the Professional Contractors Group.

They offer:

  • Low weekly/monthly fixed fees
  • NO entry or exit fees
  • Money backed service guarantees
  • No voice mail or automated call handling - all calls are answered by real people and within three rings.

Unlike other Employment Service Companies and Umbrella Companies they will not take a percentage of your income, their weekly or monthly fees remain the same regardless of your earnings. For the duration of each contract you will be guaranteed a payment from them regardless of whether they have received funds from your agency/client - this is a unique service within our industry.

If you choose to use ContractorUmbrella, but then wish to convert to a Limited Company at any time ContractorUmbrella will arrange this for you quickly and easily.

If you have any questions about ContractorUmbrella or using an umbrella companies  please call phone 02036977703, email This email address is being protected from spambots. You need JavaScript enabled to view it. or visit  www.contractorumbrella.com.

Umbrella Company Guide - Choosing an Umbrella Company

It may seem like there are thousands of umbrella companies out there: ContractorUmbrella, Giant Strongbox, Parasol IT, Liberty Bishop, Oxygen 360, Parasol Group, Orange Genie, Atlantic umbrella, Crystal umbrella, Danbro, Plan IT, Tarpon, Alternet, Bedouin, Paymatters, Churchill Knight. . . to name just a few. 

The best advice we can give before choosing a company is, and it may seem obvious but you’d be surprised at the number of contractors who don’t, is. . . do your research. All companies are going to say they are the best and have outstanding service, what else could they possibly say? Some may even be recommended by recruitment agencies - it’s worth mentioning that some agencies do receive referral commissions for recommending certain companies which may affect why and who they recommend. Choosing an umbrella company is an important decision so why not try Googling them or search for posts on forum websites, you could also ask other contractors and colleagues. Our advice is, have a good hunt around, there are good companies out there.

Find below RMI's Top 7 tips on choosing an umbrella company:

1. Steer clear of umbrella companies that have: entry fees, exit fees or minimum term commitments with penalties for leaving early.

2. Avoid companies that link their fees to your rate; these can be expensive as your fees increase in line with rate increases. Umbrella companies like this often have complex fee structures that are in some way linked to contract values - why should you pay more just because you earn more? It's not like the umbrella company has to do anymore work. Clearly advertised, fixed fee structures are best.

3. Don't touch umbrella companies that tell you it is ok to claim expenses without receipts – in the event of an investigation by HM Revenue and Customs they would be disallowed and you would be liable for all the tax owing.

4. Look for an established umbrella company - this may seem obvious but a number of umbrella companies have sprung up recently and if they fold or go into administration, they will take your money with them, leaving you out of pocket.

5. It is often difficult to tell an ethical or honest umbrella company just from their website or brief telephone conversation. Generally speaking, if they are promising expense claims with 'No Receipts' and larger than what seems reasonable or possible take home pay, they are best avoided. All umbrella companies operate under the same HM Revenue and Customs regulations.

6. Are they compliant? Have they been reviewed or audited externally? This is becoming increasingly common. Of course an umbrella company will advise you they are compliant, they are hardly likely to tell you otherwise. Ask what their marketing claims are based on and remember it is you who the Revenue will investigate and not your umbrella company.

7. Finally the personal touch, yes fully automated and online only umbrella companies are cheaper, but you will most definitely need to speak to a human being at some point, especially if you are new to contracting. Do a test call and ask a few questions - will you have a dedicated account manager? Do they have service level agreements? Or will you be pushed from pillar to post speaking to 20 different people having to explain who and what you want 20 different times.

We hope you have found these tips useful.

If you have any questions about umbrella companies, contracting or using an umbrella companies please call 02036977703, e-mail This email address is being protected from spambots. You need JavaScript enabled to view it. or visit www.contractorumbrella.com.

Alternatively, if you have any questions about contracting through your own limited company or would like any further advice please call our New Client Services Team on phone 02036977703 or email This email address is being protected from spambots. You need JavaScript enabled to view it..

Click on the links below to read our other umbrella guides:

RMI Accountancy provides Umbrella Company Services to contractors and freelancers through it's sister company Contractor Umbrella.

ContractorUmbrella Ltd

ContractorUmbrella is part of the RMI Accountancy group and was formed in 2002 to provide employment services to UK based contractors who do not wish to operate through their own Limited company.

They are also the first umbrella company to be fully compliant with all Managed Service Company (MSC) and debt transfer legislation, as reviewed by KPMG. This is important as many other umbrella companies claim to be HMRC compliant - but can they prove it? ContractorUmbrella can, read KPMG's review.

ContractorUmbrella is an alliance partner of Contractor UK, Contractor Money, FreelanceUK and is an associate member of the Professional Contractors Group.

They offer:

  • Low weekly/monthly fixed fees
  • NO entry or exit fees
  • Money backed service guarantees
  • No voice mail or automated call handling - all calls are answered by real people and within three rings.

Unlike other Employment Service Companies and Umbrella Companies they will not take a percentage of your income, their weekly or monthly fees remain the same regardless of your earnings. For the duration of each contract you will be guaranteed a payment from them regardless of whether they have received funds from your agency/client - this is a unique service within our industry.

If you choose to use ContractorUmbrella, but then wish to convert to a Limited Company at any time ContractorUmbrella will arrange this for you quickly and easily.

If you have any questions about ContractorUmbrella or using an umbrella companies  please call phone 02036977703, email This email address is being protected from spambots. You need JavaScript enabled to view it. or visit  www.contractorumbrella.com.

RMI Accountancy

RMI Accountancy are the UK's largest specialist provider of fixed fee, Limited company accountancy services to contractors; we've been acting for contractors across the UK. We are the only national specialist firm of contractor accountants with offices across the UK. RMI Accountancy also have more qualified staff than any other firm in our market with qualifications from the following major tax and accountancy bodies - IFA, FTA, IBA, ACCA.

  • Unlimited face to face meetings. This is another unique service for a nationwide accountant to contractors, only RMI Accountancy offers unlimited face to face meetings across the UK - tax is complicated and sometimes only a meeting will do.
  • UK's Largest contractor accountants with more qualified staff. No call centres, no outsourcing, no automated call handling. Simply telephone, email or meet your own dedicated tax expert face to face.
  • Money back service guarantee. All your telephone calls and emails will be answered the same day or we will make a full refund of that months fee.
  • Outstanding reputation. We have won more awards for customer service and accountancy excellence than any other firm in our market, including: Best Accountant for Contractors, Accountant of the Year and Best Professional Service Team to name just a few.
  • All inclusive low cost fixed fee accountancy package which includes completion of accounts*, payroll bureau, dividends and corporation tax computations, personal taxation, free bookkeeping software, access to your own dedicated tax expert and all company returns for a fixed fee of £95 per month.

If you have any questions about contracting or would like any further advice please call our new client services helpdesk on phone 02036977703 or email  This email address is being protected from spambots. You need JavaScript enabled to view it..

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