Umbrella Companies | The Naïveité of Youth - An Umbrella Education

The Naïveité of Youth – An Umbrella Education

We’ve just welcomed a new intern onto the news desk here at Umbrella Companies. Why the boss hired her, I have no idea, as it’s literally taken the best part of a week for her to finally understand that we don’t sell umbrellas, never have sold umbrellas, and that umbrella sales definitely isn’t a market sector we’re about to go into.


She’s one of the generation who believes that self-employment means swanning around the world on an endless holiday, posing for photos on Instagram and doing a few hours ‘work’ around her social life. ‘Digital nomading,’ she calls is. Whatever.

We’ve had quite an education job to do here at UCHQ.

When she finally realised that umbrella companies aren’t actually related to weather, eventually, she asked a useful question:

“Well, Ed, what do umbrella companies do? Why do people need one?”

So, it fell to me to explain.

Umbrella companies make all those Instagram posts possible by freeing up all that time for contractors by doing, you know, the actual back-office work that comes with being a contractor. Admin, paperwork…. like…um, the stuff we hired you to do.”

“I can outsource that?”

‘That’s not really the point, is it? It’s not as though you have other jobs to do.”

“But Instagram…”


“Umbrella companies handle admin. Invoicing and billing your client. Managing your timesheets and making sure you get paid on time. They do all that. And tax. They sort out all your tax and deal with HMRC and Inland Revenue for you. Many umbrella companies offer free insurance too.”

“For travel and holidays?”

“No, for professional indemnity and public liability. Travel insurance is something else. We’re talking about actual work here, remember? And pensions. Most can offer a pension scheme you can pay in to. They can also advise on what expenses you can claim for.”

“Like taking holidays for my Instagram feed? Trips to the salon? Looking this good all the time is a job in itself, you know, Ed.” (She actually believes my name is ‘Ed,’ rather than an abbreviation of ‘Editor,’ but that’s another story…)

I didn’t have the patience to get into IR35 with her. “Not travel and beauty expenses, no.”

“But why not set up my own Limited company and pay an accountant?”

“Well, you could do that, and for some long-term contactors that’s possibly not a bad idea to consider, but then all the paperwork and filing accounts and company running costs aren’t cheap and they fall back on you to make sure they’re done properly, which isn’t easy if you’re busy making money.”

I needed a break, so I set her the task of taking a look at our ‘Top 10 Umbrella Companies’ page and read up on the companies there.

It’s going to be a long week…

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