Contractors rely on the umbrella companies to make sure that almost all their tax liabilities are calculated correctly and the best amounts of income tax and National Insurance Contributions are paid to HMRC on time.
And because contractors take guidance from umbrella companies about what expenses they can legitimately claim back and offset against their tax bill, it is vital that the service company is compliant.
But how can you see if your umbrella company is complaint? Listed here are five key checks to make sure umbrella companies are compliant:
1: Investigate the umbrella's background
Make certain the umbrella company is UK based and includes a good trading history. Buy a comprehensive credit report that highlights any bad debts. Look at contractor websites that review umbrella companies and best 16k ribs umbrella in bangladesh check contractor forums that could indicate whether an umbrella is trading compliantly or not. Ask your fellow contractors who they've used and search for news reports on the net - the umbrella could have been put through repeated investigations by HMRC.
2: Check your contract of employment
Being an umbrella company contractor, you'll become a worker of the umbrella and should expect to receive everything that accompany being fully a full-time permanent employee. This includes a formal contract of employment that gives you the terms and conditions of one's employment, including a minimum of 336 hours annually paid at the legal minimum wage.