The Umbrella Company Employee

An Umbrella Company acts as an in-between for contractors. Essentially, they enter into a contract with the Umbrella Company that makes them a PAYE employee.

The end client or recruitment agency then enters into a separate contract with the Umbrella Company for the services the contractor is providing. The Umbrella Company will then pay the contractor as an employee deducting all necessary taxes from they pay before it is received.  The umbrella company will also allow contractors to increase their tax savings by allowing them to offset allowable expenses.

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