How often will the umbrella company margin be deducted?

If you are new to contracting or have never used an umbrella company, you may wonder how often the umbrella company will deduct a margin. Please continue reading to discover what a margin is and how often it is deducted.

What is an umbrella company margin?

Umbrella companies will retain a weekly or monthly margin each time they process payroll for a temporary worker. The margin covers the umbrella companies’ overheads and is the only income compliant umbrella companies generate for themselves. An umbrella company will deduct the margin from a contractor’s pay before tax deductions (e.g. income tax and employee National Insurance) as this provides you with tax savings.

The other deductions made to a temporary worker’s pay are tax deductions or deductions required by law, which are paid directly to HMRC or the required government body. It is also important to note that the umbrella company does not set how much tax should be deducted from a contractor’s pay—these deductions are set by HMRC and are based on your tax code.

How often will the umbrella company margin be deducted?

The umbrella company will deduct a margin every time it processes payroll for a temporary worker. Most commonly, this is weekly, bi-weekly, or monthly. Therefore, if you are paid weekly, the umbrella company will deduct a margin each week that it processes a payment for you.

The umbrella company will follow the payment schedule set by the recruitment agency or end client. If you are unsure how often you will be paid, please contact our Customer Service department if you are an employee of Churchill Knight Umbrella. If you are not an employee of Churchill Knight Umbrella, please get in touch with your recruitment agency, end client, or umbrella company.

Will the margin be deducted for weeks I don’t work?

Churchill Knight Umbrella will not deduct a margin for weeks or months during which you are not working, and we have not processed a payment for you.

How much is an umbrella company margin?

An umbrella company margin will vary between providers and is deducted weekly or monthly – depending on your payroll. An umbrella company’s weekly margin is usually between £15 – £30, and you can expect a monthly margin to be between £60 – £100. The margin is the only deduction that will differ between compliant providers and alter your take-home pay, as they should all process your pay via PAYE and make correct deductions as per UK tax law.

Are you looking for an umbrella company?

Our FCSA-accredited and SafeRec-certified service ensures contractors are paid compliantly by an umbrella company they can trust! Since we launched in 2017, we have quickly become one of the most popular umbrella companies in the UK, and we would be delighted to welcome you to the service.

If you want to learn more about Churchill Knight Umbrella or register with our umbrella service, please call us on 01707 871622. You can also schedule a call at a time that works for you, and a team member can provide a tailored take-home pay illustration and answer any questions you may have.