What sorts of roles are the services of umbrella companies applicable to?

Manually calculating and preparing a tax return can be a difficult job for anyone. Although many people get the majority of their tax sorted for them automatically as they are employees of a particular company, there are many others who do not have this luxury. For those who are in the position where they need to sort and organise it themselves, a great solution for them is to make use of an umbrella company. Contractor umbrella companies are businesses who basically take on individuals as “employees”, and therefore can  look after their various taxes and contributions in the same way as it would be done for someone who was in fact a full time employee of a certain company.

The services that umbrella companies offer can be extremely useful to certain individuals, saving them a lot of time and potentially money, and leaving them with the peace of mind that the whole process is being managed and looked after for them. In this article, we are going to take a look at the different sorts of people that can be helped by the services that umbrella companies have to offer.


The fact that umbrella companies are often referred to as “contractor umbrella companies” just goes to show that this is the type of role that is most commonly associated with the services. Contractors who find themselves working for a single, particular company or firm on a relatively long term basis may well find the services of umbrella companies of particular use to them. The other advantage using an umbrella company offers a contractor is the fact that even if they do not know how long they will be working with a certain company, the automated system can still manage their tax process for them.

Freelance staff

The role of a freelancer sees individuals working for a whole range of different companies throughout a single tax year. A freelance writer, for example, may work for hundreds of different companies in a 12 month timespan. However, these people will still need to ensure that they are paying the correct amount of tax and contributions during the period, and making use of an umbrella company is a good way of doing this.

Temp staff

Today’s modern workforce is made up of a huge percentage of temporary workers. This is perhaps more the case now than ever before due to the tough current economic climate, meaning that many companies or businesses do not have the resources to have as many full time, contracted employees as they would like. In a similar way to freelancers, temporary staff may find themselves working for a number of different companies or employers in one single tax year, and so the services an umbrella company offers give them the chance to manage the process easily.


Internships are becoming an ever growing more popular method for companies looking to take on staff nowadays. It gives them the opportunity to hire individuals, often only paying their expenses, and basically test them out in a particular role for a short period of time, before potentially offering them full time work in the future. Some internship roles are paid, however, and so if there is a salary being taken home, tax must be paid on it.

This article takes a look at some of the different sorts of people that may find the services of contractor umbrella companies particularly useful, for example those in temporary, contractor or freelance positions.

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