Umbrella Vs PAYE



Messages count : 3
Likes count : 0
Registration : 15 March 2007
Contact in PM
Hi everyone

I'm new to this forum, my name is Suzanne and I've recently quit my job and decided to go freelance as a designer. I have a few jobs lined up through contacts and I've signed up with a few different agencies so there's no shortage of work. The problem is how to get paid for it.

I decided to register under an umbrella company, I though this would be best because PAYE through the agencies doesn't make you as much money, and setting up a limited company is a commitment I'm not sure I want to make as I'm not sure how long I want to do this for.

But having looked into it, I'm not sure these umbrella companies are such a good idea, one thing I didn't realise is that I have to pay employee AND employer National Insurance, this works out as a lot each week. I know it should be offset by the tax breaks, but as far as I can see the only tax break I get is millage allowance, which doesn't add up to that much. Is there other tax breaks I don't know about?

Basically what i want to know is; would I be better off going PAYE with an agency, or is the umbrella company better? I though for sure the umbrella company would be better but now I'm not convinced, is there something I'm missing?

Please can anyone explain this to me? I'm so confused!

Connecting tech talent

Free-Work, THE platform for all IT professionals.

Its contents and its IT job board are 100% free of charge for contractors and freelancers.

Recruiters area
2024 © Free-Work / AGSI SAS
Follow us

FreelanceUK has moved to Free-Work

We would like to welcome you to Free-Work, an international platform dedicated to supporting IT freelancers and contractors with their professional journeys in the tech industry.

FreelanceUK news, guides and resources, including the forum, have now moved to Free-Work, where we will continue to report on everything from tax issues and market demand to freelancing tips and technology trends. You can also search the latest IT contracts and freelance tech job opportunities on our jobs page.

💡 Good to know: Your forum profile remains the same. To login, nothing could be simpler, all you need to do is use your email linked to your FreelanceUK account and your password.

Enjoy your visit!

The Free-Work team