Umbrella Or Limited

Limited Company – Many contractors set-up their own limited company through which they work. Limited companies must be registered with Companies House, should carry professional indemnity insurance, and are responsible for their own invoicing, accounting, tax and employee contributions. Most accountancy firms can advise you about setting-up a limited company.

Umbrella Company – Umbrella Companies allow contractors to operate through a third party. The umbrella company will take responsibility for invoicing, payment and deductions. They should also offer you professional indemnity. The umbrella company charges a fee which is deducted from the pay you receive.

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