Plenty of companies in UK these days choose to make use of PAYE payroll services when it comes to managing the payroll for their services. The Pay As You Earn (PAYE) is a type of payroll wherein the agency functions as the employer of the contractor so that they become responsible for paying their salaries to them. The PAYE payroll companies perform an all-important role of deducting the employed levels of the NI and tax contributions that are calculated and eventually paid prior to the stage when the contractor gets his or her salary. The unique thing about the concept of the PAYE umbrella company is that a client firm becomes the employee of that company. Based on the requirements of your company, you instruct the payroll company to manage the payments of the salary based on the invoice you send as per your time sheet. They are going to provide you with a net salary according to the calculations and deductions of income tax on your earnings.

Once you have set up a contract with the payroll company, you can consult your agent to provide the contract to the PAYE umbrella company so that they can put their signature in them. The contract is going to be drawn between you and your umbrella company. The widespread practice of companies in UK to join umbrella schemes has led to the birth of many such service providers that can perform such a task for their end users. Since joining the umbrella scheme can be done with only little effort, you can get a contract ready for the IR35 and then decide about the payment structure that you are going to use.

There are certain things that you need to keep in mind when you are looking to hire one of the payroll companies UK for your company’s needs. First and foremost, the agency should be a contractors employer so that they are responsible for handling payments for the contractor. The contractor should submit the contractual timesheets to the firm. The employed levels of NI and tax should also be calculated and paid right on time. The tax relief on the expenses are not available. The contractor should also have access to some specific types of statutory benefits, such as the statutory sick pay. The acronym PAYE is often used for the people who get an amount of occupational pension from the previous employer.

One of the things that are associated with the PAYE payroll companies is the IR35 legislation. This IR35 legislation can help in determining if the company is suitable for tax purposes. The IR35 legislation can also define the contract that you have with the clients that you get in touch with. The companies that operate within the PAYE Umbrella have their payrolls managed through the PAYE system. So if you are thinking of getting professional assistance with your payroll requirements, make sure that you consult with an expert in the UK who will be able to handle the same for you.