Umbrella company calculator
A take home pay calculator umbrella workers can check a payslip against, from a day rate. Umbrella payslips look alarming because most of the deductions are not fees, and this separates what the umbrella keeps from what goes to HMRC.
Updated 13 September 2026 · Tax year 2026/27
Umbrella company pay calculator results #
| Assignment rate a year | £77,000.00 |
| Less umbrella margin | − £1,300.00 |
| Less employer National Insurance | − £9,178.57 |
| Less apprenticeship levy | − £330.95 |
| Gross pay | £66,190.48 |
| Less Income Tax | − £13,908.19 |
| Less employee National Insurance | − £3,334.41 |
| Take home a year | £48,947.88 |
| A month | £4,078.99 |
| Kept from the assignment rate | 63.6% |
Umbrella company fees calculator: what each line is #
Umbrella company charges are the single biggest source of complaint, and most of the anger is aimed at the wrong line. Here is what each deduction is:
| Deduction | Who gets it | |
|---|---|---|
| Umbrella margin | The umbrella keeps it | The only part that is actually their fee |
| Employer National Insurance | Goes to HMRC | Legally the employer cost, in practice taken from the assignment rate |
| Apprenticeship levy | Goes to HMRC | 0.5% of the paybill, passed on |
| Holiday pay | Yours | Rolled up or held back, not an extra cost either way |
| Pension contribution | Yours | Auto enrolment applies, and you may opt out |
| Income Tax and employee NI | Goes to HMRC | Deducted from gross pay through PAYE |
Only the first line is a fee. Umbrella company costs in the sense that matters, the part you can shop around on, are typically £15.00 to £30.00 a week. Everything else is fixed by law and identical whichever provider you use.
Umbrella company comparison: does the margin matter? #
Less than the marketing suggests. Moving from £30.00 to £15.00 a week saves £780.00 a year before tax, and rather less after it.
An umbrella company comparison is therefore mostly about the margin, how quickly they pay, whether they are accredited, and whether the payslip is readable. It is not about take-home percentages, and umbrella company reviews that lead with a take-home figure are the ones to distrust.
Umbrella company tax treatment is identical everywhere: PAYE and National Insurance in full. That is the whole point of the arrangement, and it is why an umbrella company UK contractors use should produce roughly the figures above whichever name is on the payslip.
Umbrella or your own limited company? #
That question is really about IR35. If the engagement is inside IR35 the two routes end up close together; if it is outside, your own company keeps more.
Umbrella company or PAYE is a slightly different question, and a common source of confusion: an umbrella is PAYE. The comparison people usually mean is umbrella against being employed directly by the agency on its own payroll, and there the difference is that the agency route does not deduct a margin or pass on employer costs from your rate. Where an agency offers both, its own PAYE is normally better paid.
| Through an umbrella | £48,947.88 |
| Inside IR35, through your own company | £49,600.69 |
| Difference, which is the margin after tax | £652.81 |
For the outside-IR35 comparison, and for what the determination is worth overall, use the inside vs outside IR35 calculator. The rules themselves, including why an umbrella sits outside the off-payroll regime entirely, are in the IR35 guide.
What changed on 6 April 2026 #
The most important umbrella company UK development in years, and it happened quietly. Responsibility for operating PAYE on umbrella workers moved up the supply chain.
| Before | From 6 April 2026 | |
|---|---|---|
| Who accounts to HMRC for PAYE and NI | The umbrella company | The recruitment agency, or the end client where there is no agency |
| Who HMRC pursues if it is not paid | The umbrella, then often the worker | The agency, under joint and several liability |
| Who still runs the payroll | The umbrella | The umbrella, and it must let the agency check |
It does not make every umbrella safe, and it does not cover schemes you actively signed up to. It does mean the agency that placed you now carries real exposure, so raising a concern with them is far more likely to get a response than it used to be.
HMRC umbrella company warning signs #
HMRC umbrella companies guidance, or umbrella company HMRC guidance, exists because the sector has a long history of avoidance schemes. A compliant umbrella deducts PAYE and National Insurance in full on everything you earn, and its arithmetic will match this calculator closely.
An HMRC umbrella company warning is worth taking at face value. These are the signals:
| Warning sign | Why it matters |
|---|---|
| Take home quoted as 80% or more of the assignment rate | Not achievable once PAYE and National Insurance are paid in full |
| Part of your pay called a loan, advance, annuity, grant or credit | Disguised remuneration. HMRC taxes it as income, from you |
| Two separate payments, one taxed and one not | The untaxed part is the part HMRC will assess |
| Anything routed through an offshore company or trust | A standard feature of avoidance schemes, not of payroll |
| A payslip that does not reconcile to what reached your bank | You cannot check what you cannot see |
| Being asked to sign a separate agreement you do not understand | Often the document that creates the non-taxed element |
HMRC publishes a named tax avoidance schemes and promoters list. That HMRC umbrella company list is not exhaustive, and a provider being absent from it proves nothing, but a provider appearing on it settles the question.
Your holiday pay is also yours. Rolled-up holiday pay at 12.07% is legitimate for irregular hours work, but it must be identified on the payslip. The holiday pay calculator shows what the entitlement should be.
Common questions #
What is an umbrella company?
The umbrella company meaning, and the umbrella company definition, are the same: a company that employs contractors and pays them through PAYE. An umbrella company for contractors invoices the agency or client for your work and pays you a salary after deductions, so you are its employee rather than self-employed.
What are typical umbrella company fees?
The margin is usually £15 to £30 a week. That is the only part the umbrella keeps. Everything else on the payslip, employer National Insurance, the apprenticeship levy, tax and employee NI, goes to HMRC.
Why are umbrella company deductions so large?
Because the assignment rate has to cover employer costs before your gross pay is worked out. Employer National Insurance and the apprenticeship levy come out first, which is often mistaken for the umbrella keeping the money.
How much does an umbrella company cost?
On these figures the margin costs £1,300 a year and reduces take home by £653. Umbrella company charges above about £30 a week are worth questioning, because the service is identical between providers.
Is an umbrella company the same as a limited company?
No. With an umbrella company you are an employee and taxed through PAYE. With your own limited company you are a director, the company is paid gross, and you decide how to take the money out. Umbrella company limited comparisons usually turn on whether the contract is inside or outside IR35.
Do umbrella companies affect IR35?
They remove the question. IR35 applies where you work through your own intermediary. An umbrella already employs you and taxes you through PAYE, so there is nothing for the off-payroll rules to look through.
Are umbrella companies regulated by HMRC?
HMRC publishes guidance on working through an umbrella company and names schemes it considers to be tax avoidance. A compliant umbrella deducts PAYE and National Insurance in full. Any arrangement promising materially higher take home is almost certainly a disguised remuneration scheme.
Are umbrella company reviews worth reading?
For service quality, yes: how fast they pay, whether the payslip is legible, whether anyone answers the phone. For take home, no. Umbrella company reviews claiming one provider pays materially more than another are describing a scheme or a misunderstanding, because the deductions are set by law.
What is the apprenticeship levy on my umbrella payslip?
A 0.5% charge on the employer paybill. Umbrella companies are large enough to pay it and pass it on, so it is deducted from the assignment rate before your gross pay is calculated.