Contractors’ Responsibilities

Contracting via an umbrella company such as Parasol does remove a lot of the hassle and stress of contracting. It can also be a great way for people to start out on a career in contracting and dip their feet into the industry without the commitment needed to set up a limited company.

When you join an umbrella company such as Parasol, you should legally become an employee of that company. And as an employee, there are a couple of responsibilities you do need to take on in order to ensure you get paid accurately and on time.

As a contractor working via an umbrella company, you will need to fill in timesheets detailing the work you have done for the client, and the number of hours or days you have worked in a given time period. Your manager or team leader at the client site will typically authorise (sign) your timesheet and then you submit them to your umbrella company.

Fortunately, the bad old days of manually faxing in your timesheets on a Friday afternoon are long gone and most umbrella companies, including Parasol, will have a secure, online portal you can use to upload them.

Some recruitment agencies take advantage of all this automation by allowing their contractors to avoid manually filing timesheets at all, however, it is important that timesheets are kept up to date and submitted at regular intervals, ensuring you are always paid on time.

For umbrella contractors, it’s also vital that you keep all the receipts for the expenses you have incurred in a safe place, ready to dig them out should you ever be asked to produce them by HMRC. Some dodgy umbrella companies will tell you that because they have a special dispensation from HMRC, you can claim for expenses without a receipt. This is extremely bad practice and you should avoid umbrella companies that operate in this way. Any dispensation awarded to an umbrella is simply to improve efficiency, and contractors should only claim for expenses they have legitimately incurred and always keep a copy of receipts.

If you decide you want to work via your own limited company there are a different set of responsibilities you need to be aware of and we’ve covered these off here.