An umbrella company is like a middle man, it is an organisation that employs freelance contractors and then each contractor goes and works for their end clients.
For example:
This is not a tax efficient system.
So why do some freelance contractors use umbrella companies?
If you are planning on contracting for less than 3 or 4 months then it makes little sense forming a limited company and contracting through it.
If however you are planning on contracting for more than 4 months it makes little sense to use an umbrella company.
For a personal review of your circumstances please contact us.
This information is for general information only. We take no responsibility for any action taken or refrained from in consequence of its contents. Always seek our professional advice specific to your circumstances before acting.