The Low Incomes Tax Reform Group, an educational charity for lower paid workers, has produced in conjunction with PRISM, the not-for-profit employment intermediary body a new fact sheet offering guidance to those working through an umbrella company and provides practical tips to help them avoid any problems with their pay and deductions.
The factsheet covers a range of issues on which workers are likely to have questions including holiday entitlement and other employment right issues, the availability (or otherwise) of travel expense relief and why they may have been handed over to an umbrella company by an agency in the first place. It includes a helpful diagram explaining how umbrella companies work, a sample payslip to help demystify the sometimes confusing payslip entries and links to more help.
Very importantly, it includes a ‘ready reckoner’ to help workers understand whether the rewards they are being offered through an umbrella company are roughly equivalent to what they might have otherwise received, once the various deductions the umbrella company has to make have been considered.
The factsheet ‘Working through an umbrella company’ can be found on our website.