Register your CV. Let us do the hard work

  • Accepted file types: pdf, doc, docx.
  • This field is for validation purposes and should be left unchanged.

There are two main options that contractors tend to opt for, both with different advantages and different benefits, but which is best for you? We have given a brief overview that might help you understand which is the most suitable option for you.

limited company OPTION

The benefits of operating as your own limited company are mainly monetary based, providing you are operating outside of IR35.


  • Tax benefits including access to the Flat Rate VAT Scheme
  • National Insurance – compared to the Umbrella option you pay around a tenth when setting up a limited company. If you are paid £350 a day this works out to be an annual saving of around £10,000-12,000, based on a 45 week working year.
  • Complete control of your financial affairs
  • Ideal for high paying contracts
  • Expenses such as travel can be claimed back
  • All of our preferred suppliers offer accountancy services alongside the umbrella option and will help manage this for a fraction of the cost of the umbrella service. (Please email us below to request a copy of our PSL)


  • You as director of your limited company are required to pay for and provide business insurances to cover your limited company.
  • You have to open a limited company bank account
  • As director of the company you must provide paperwork and submit tax documents on a regular basis.
  • Higher level of liability and responsibility

Umbrella Employee OPTION


  • Less paperwork
  • All Tax and NI is deducted, no further tax to pay.
  • Suitable for short term contracts and for those paying less than £25k a year.
  • IR35 does not apply to umbrella employees


  • Umbrella companies charge you a fee for this service, which can vary and is more costly than running your own limited company.
  • You are effectively operating as a permanent employee
  • On average you will take home 60-65% compared to 75-80% when operating through a limited company.


One way of looking at it is, if you have two contractors both on the same £600 per day. One contractor ‘A’ uses an Umbrella company and another ‘B’ trades through their own limited company the difference after the affect of NI and flat rate VAT scheme are as follows:

A – (Umbrella) real value of contract after NI is around £115,000
B – (Ltd Co) real value of contract after NI and Flat rate VAT is around £138,000

If you have any queries then please feel free to contact me.
+44 (0) 207 397 0196