Umbrella Salary Calculator

Calculate your take-home pay

Calculate your
take-home pay

Calculations are for illustration purposes only and are based on a series of assumptions.

One of the most important considerations for contractors is the subject of take-home pay. Whilst establishing your own limited company may be the most tax-efficient way of operating, sometimes, working under an umbrella company can better suit your circumstances.

Many new and short-term contractors look to umbrella companies as they believe that this is the best first step into contracting. This is due to the fact that an umbrella company will manage your finances and there is no additional admin to complete on your part. As an employee, you also do not need to worry about IR35, as you won’t be affected by the rules.

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If you’re still considering which route is best for you, or you’re wondering what you can expect to take home working under an umbrella company, we’re here to help.

Limited or umbrella? What is best for me?

Are you new to contracting and unsure which business structure is best for you? Our free downloadable guide illustrates the differences between limited and umbrella to help you make the decision.

What’s inside the guide?

  • Umbrella & limited – the differences between the two structures.
  • Advantages & disadvantages – which route is best for you?
  • Rates of take-home pay – how much could you earn?

Calculate your take-home pay as an umbrella employee

If you are considering working under a PAYE umbrella company, as part of many of our packages, we have margin free umbrella employment available via our sister company, Parasol. Parasol has been helping freelancers and contractors make the most of their money whilst reducing their administrative burden, and are well placed to support contractors who choose to operate through a PAYE solution.

Calculate your umbrella take-home pay using Parasol’s online calculator.

How do umbrella companies calculate pay?

When you work through an umbrella company, a number of contributions will already be made before a salary is paid to you:

  • Any tax, National Insurance and pensions contributions.
  • Service and included extras - this will vary from company to company but takes costs such as insurance into account.
  • Any holidays and sick days incurred.
  • The number of hours worked and your daily or hourly rate.

Is umbrella or limited best for me?

Though both options offer you a route into the world of contracting, there is a considerable difference between contracting under an umbrella or through your own limited company. Ultimately, this decision comes down to personal preference, your assignment requirements and which route best suits your unique needs.

There are arguments for and against each route: Although contractors generally earn less working through an umbrella, this is often balanced out by the convenience of having your umbrella company managing your admin and taxes on your behalf.

On the other hand, limited company directors can expect a higher take home pay and enjoy tax efficiencies. However, directors normally have to invest some time to manage tax returns, company accounts and payroll (but an accountant can ease this burden). If you are also caught inside IR35, you would not be able to utilise these tax efficiencies so umbrella may be a better route for you.

If you would like some flexibility on how you work, Caroola can help. Through our margin free umbrella employment service as standard within the majority of our packages, you can easily switch between limited and umbrella, depending on your needs – including your assignment’s IR35 status.

Our take-home pay examples show the difference in take home pay between umbrella and limited.

Support from Caroola

Whether you’re certain which route you want to take as a contractor or you still need some help to decide, the experts at Caroola are on hand to give you all the help and advice you need.

To find out more about working through an umbrella company or to find out which option is best for you, call our team on

Umbrella Company Guide Calculate Your Pay

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