Umbrella company / taxes

[ced--ced]

Hi,

I've lately decided to use an umbrella company to invoice for the the projects I've done and to take care of the taxes for the gouvernment. I'm based in the UK and use contractorumbrella.com.

The first payment that they've processed for me was charged at £260 and after all the deductions for the gouvernment, I've ended up with £148.40!!! Almost 40% was taken off!!!

The umbrella company charged me only £19.95 for the process, which I think is fine, but all the rest...!

So I was wondering if anyone had some good tips on how I can save money and not ending up having to double my rates!!

Thanks

[mandissected]

What money are you trying to save? Just taxes?

[lesli_felix]

Umbrella companies are a scam, as is income tax in general

Your only way to avoid being screwed by the government or an umbrella company is to form a ltd company, pay yourself a small salary and the rest in dividends, which are taxed at 20%

You'll probably need a good accountant though.