Many people envision going into business for themselves. You might be a freelance writer, a web designer, or even a professional athlete; the thought of not having a boss is intriguing to say the least. Though it can be a wonderful situation to answer only to yourself and customers, it can also be a confusing and somewhat scary one as well. Taxes are one of the most frightening aspects of self-employment, and keeping your records straight is a sometimes daunting task. A PAYE, or pay-as-you-earn, umbrella company can help out greatly in this case. How do PAYE umbrella companies help you with your tax liabilities?
An umbrella company basically acts as your employer when you sign up with one. By signing on, you are a contracted employee of the company and are no longer subject to the taxation regulations that freelancers have to contend with on their own. You receive a paycheck from the umbrella company, and these earnings have already had the proper taxes withheld, and this saves you quite a few headaches because you do not have to hire a bookkeeper to reconcile the records.
You submit your timesheets to an umbrella company just as you would any employer, except these are records of the hours you put in on your own. What you do not have to deal with, however, is attempting to figure out how much to set aside for taxes. An umbrella company will also provide you with forms that tell you how to write off business expenses, and its accountants will take care of all of the figures for you. The umbrella company then contacts your client to ensure that the timesheets correspond, freeing you up from having to do it.
Umbrella companies save you time regarding taxation because your bookkeeping is done by them. As stated, PAYE companies allow you to offset actual business expenses, which can save you money. Plus, under an umbrella company, you are tax efficient under IR35 and MSC legislation. An umbrella company's accounting department will take care of these matters, which frees up a good amount of time for you.
PAYE umbrella companies take the tedious and sometimes confusing accounting duties and perform them for you. By becoming an employee of a company instead of going it alone, you save time and are more likely to comply with the current taxation legislation. Not only do you save the time it takes to prepare your taxes, you also receive the added peace of mind from knowing that you are in compliance at the hands of professionals.
An umbrella company basically acts as your employer when you sign up with one. By signing on, you are a contracted employee of the company and are no longer subject to the taxation regulations that freelancers have to contend with on their own. You receive a paycheck from the umbrella company, and these earnings have already had the proper taxes withheld, and this saves you quite a few headaches because you do not have to hire a bookkeeper to reconcile the records.
You submit your timesheets to an umbrella company just as you would any employer, except these are records of the hours you put in on your own. What you do not have to deal with, however, is attempting to figure out how much to set aside for taxes. An umbrella company will also provide you with forms that tell you how to write off business expenses, and its accountants will take care of all of the figures for you. The umbrella company then contacts your client to ensure that the timesheets correspond, freeing you up from having to do it.
Umbrella companies save you time regarding taxation because your bookkeeping is done by them. As stated, PAYE companies allow you to offset actual business expenses, which can save you money. Plus, under an umbrella company, you are tax efficient under IR35 and MSC legislation. An umbrella company's accounting department will take care of these matters, which frees up a good amount of time for you.
PAYE umbrella companies take the tedious and sometimes confusing accounting duties and perform them for you. By becoming an employee of a company instead of going it alone, you save time and are more likely to comply with the current taxation legislation. Not only do you save the time it takes to prepare your taxes, you also receive the added peace of mind from knowing that you are in compliance at the hands of professionals.