There is no doubt that freelancers and contractors are the backbone of the UK economy. This is a sentiment has been echoed by the government many times during the past year.

 

As redundancies continue across many UK industry sectors, the choice to diversify into freelance or contracting work is a path that many are considering. We know that this flexible and essential workforce will be a lynch pin in the UK’s economic recovery in the coming year and onward once the pandemic subsides.

 

There are several options available for contractors and freelancers to manage their payroll requirements. Options include running their own Limited Company, being self employed as a Sole Trader, or utilising an Umbrella Company, each of these situations has its own unique merits.  

 

The changes to IR35 regulations coming into force on the 6th April 2021 have already seen huge numbers of contractors make the switch to Umbrella payroll solutions in order to ensure that they maintain complete compliance.  Certainly in terms of removing the stress of administration and with the additional benefits of maintaining employment records needed for mortgage applications and giving access to accruing employment rights such as statutory sick pay, maternity or paternity pay an Umbrella Company may be the most beneficial solution.

 

While the changes to IR35 regulations may appear confusing and cumbersome to contractors, good Professional Employer Organisations are well equipped to deal with these changes and ensure that contractors remain compliant with HMRC regulations. At Think Formations, we can assist you and your contractors with all aspects of employee management. Contact our team for more information.