Login Umbrella Company vs Agency PAYE What's the difference? What is an Umbrella Company? Umbrella Benefits Take Home Pay Calculator Get a Quote Understanding the difference between an umbrella company, such as PayStream's My Max, and an agency payroll (PAYE) can be difficult so we thought we would explain the key differences to you. For example, do you know which one supports contributions into your personal pension through a salary sacrifice arrangement saving you £100’s in not only PAYE but also in National Insurance each month? Why choose to work through an umbrella company? Our Lead Accountant, Vicky, explains what benefits you can enjoy by choosing to work through an umbrella company in under a minute. Umbrella Company PayStream's My Max umbrella service Agency Payroll Pay As You Earn (PAYE) Ability to claim tax relief on allowable business expenses as they are incurred Continuous employment across all your contracts if working with multiple agencies Ability to supports contributions into your personal pension through a salary sacrifice arrangement One pension pot across all of your contracts if working on multiple agencies Employed under a contract of employment Access to statutory sick pay Access to statutory maternity or paternity pay Access to statutory adoption pay Access to comprehensive insurance package of employers liability, public liability and professional indemnity Access to employee rewards scheme One workplace pension pot across all of your contracts if working on multiple agencies Access to statutory bereavement leave Access to statutory shared parental leave Access to Online GP service at discounted price Access to Personal Accident cover at discounted price Umbrella company The simplest way to describe an umbrella company is that you become an employee of the umbrella company. This means that the agency will pay the umbrella company, who then after deducting all of the necessary PAYE and NI contributions pay the contractor their salary. Take a look below to see the key features of an umbrella company: Agency PAYE Pay As You Earn (PAYE) is when the agency is the contractor's employer and is responsible for paying them. The agency must deduct employed levels of tax and NI contributions are calculated and paid before the contractor receives their salary. Take a look below for some of the key features of PAYE: One of the differences, as mentioned above is that the umbrella company will make the necessary deductions and also calculate any tax relief on allowable expenses, where the contractor isn't subject to supervision, direction or control, this can result in an increase in take home pay. Very little admin to do and the contractor simply submits their timesheets and logs expenses online. The contractor will enjoy a continuous employment record which is handy for mortgage and loan applications. Access to statutory benefits and inclusive insurances, this means the contractor can do what they do best knowing they are covered. A good umbrella company, like My Max, will give contractors access to a free employee rewards scheme and other benefits like in-house financial advisors. The agency is the contractors employer and therefore is responsible for paying the contractor. Employed levels of tax and NI is calculated and paid. The contractor submits their timesheets to the agency. The contractor has access to certain statutory benefits, like statutory sick pay. Tax relief on any expenses is not available. Umbrella Company vs Agency PAYE FAQs Expand all How does an umbrella company work? How does agency PAYE work? What is the difference between an umbrella company and agency PAYE? What is an umbrella PAYE rate? What extra benefits do I get using an umbrella company? Try our new umbrella take home pay calculator We'll give you a quick estimate of how much you can expect to take home on a weekly or monthly basis. Or for more information contact our New Business Team on 0161 516 3007 (option 1). Calculate your take home pay Are all umbrellas the same? There are lots of umbrella companies out there, all promising different levels of take home pay and different levels of service, so who do you believe and who do you choose? Here are some tips and general advice for how to spot the heroes from the villains. Are all umbrellas the same? Get your free umbrella company quote. Name * Email * Telephone * Have you been referred to us by a recruitment company? * Yes No What is the Umbrella / Limited rate of pay? Has your agency/client confirmed to you that your new assignment will be outside IR35? * Yes No Unsure Marketing By submitting this form, you agree that we can contact you via email, telephone or postal communication with regards to your enquiry. But why stop there? If you’d like to receive the latest news about our products and services, including exclusive offers, please tick this box and we’ll drop you an email from time to time. And remember, you’re free to opt out whenever you’d like. Related Pages Umbrella Company Expenses FCSA Umbrella Company PayStream Reviews PayStream Rewards Stay up to date Sign up today for our mailing list for the latest industry news and updates. Reg. Address: Mansion House Manchester Road Altrincham Cheshire WA14 4RW Company Name: PayStream Accounting Services Ltd VAT No: 112587916 Registration No: 07598955 Cookie Policy Privacy Statement Sitemap Modern Slavery Statement Gender Pay Gap Report Tax Strategy Careers Tel: 0161 923 0201