What is an Umbrella Company?

What is an international umbrella company and why might you need to use one?

An international umbrella company provides a payroll and accountancy service for contractors temporarily looking to work on one or more short term contracts, at home or overseas.  The purpose of an umbrella service is to allow contractors the ability to begin, and deliver work assignments, without having to set up their own limited company.

Setting up a limited company brings the responsibility of taking care of your own tax and social premium deductions. It could be that a UK limited company might be used in certain circumstances and to start one is the appropriate best advice. Advice will always be given regarding your best compliant options, after we hear of individual personal circumstances, past work history locations, and current plans. 

The advantages of using an international umbrella company are that all the paperwork, invoicing and administration is done for you and the necessary knowledge of local compliancy regulations are taken care of, freeing you as a working specialist to focus on your travels and work objectives.

Compliance still means following different rules in each country, and also in accordance to the length of a contract, making working internationally a complicated area to be fully understood.

Where tax is payable is a crucial factor, and no party should take uninformed risks, as to do so does mean facing costly consequences.  


How it works

As a contractor you enter into a contract with the umbrella company, such as International Umbrella, as well as with your recruiter or end-client.  The umbrella company will usually sign a business to business contract with the recruitment agency. All this is done for you at the start.   

You would be responsible for filling in your timesheets, and getting them signed off, then sending them to the umbrella company, and possibly to an agency or the end client, who then authorises the timesheet and payment.  

The payment is then passed directly to us, or to your recruitment agency who then has the responsibility of promptly passing the payment across to us responding to our invoice. On receipt of payment we pay you the sum due on the same day.   

We will issue you with a payslip and payment after making all the mandatory deductions for tax and social contributions, ensuring compliance in your country of employment. We can deal with euros, dollars and sterling and send your earnings to any bank globally.  

You may have travel and accommodation expenses and other costs, some of which you can claim, and if approved by the umbrella company on behalf of the revenue, using their dispensation, you will consequently pay less tax on your earnings. We will advise you on what can and cannot be claimed for, and provide possible immediate relief of these expenses when you are paid.

It is up to you the contractor to keep all original receipts, and send photocopies with a claim form to us monthly throughout the year. In some countries this information will be offered to the local revenue in the annual declarations.  

The benefits to you

The aim at International Umbrella is to get you paid as soon as possible and to ensure accuracy of payment and paperwork.

We will comply with European law and employ contractors for the duration of their time with us, issuing a European Employment contract at the onset of each contract, which you undertake with our support. 

If you are better off using a UK limited company then we will advise you of this. However knowledge of the relevant territories local revenue and social premium expectations of you must be sought, to make sure there is no risk to you of double taxation, or revenue enquiries, in the years ahead.

An umbrella company working with contractors who work internationally is essentially a knowledge service, as well as a comfort and support to you, as you work fairly independently for your own valued clients. 

We assure you that this knowledge enhances the services of the best recruiters, and ensures that all who venture outside the UK to work are kept aware, and up to date, as to the many changes in the regulations from country to country.

It is essential that your chosen international umbrella service offer to receive and read your contract before you sign it. We ask for this so we are able to check it for a variety of reasons and can advise on the final solution ensuring you will be paid properly. If this is not offered by the company then perhaps you should reconsider your choice.

Those service providers who do not do this for their clients run the risk of getting it wrong. Reading your contract and knowing you well helps us remain compliant, and acceptable to all the best in our Industry, and moreover to you and your most valuable end clients here and overseas.               




"Respected and progressive, but most of all fit for purpose.” 

Our Services

  • PAYE locally – including Belgium, The Netherlands, France, Spain and other countries – please enquire.

  • Delivering tax efficient solutions across Europe and Internationally from the dedicated UK office.

  • Best practice – we work transparently with no unexpected fees, false promises or unrealistic return on income rates.

The Complete International Umbrella Service

Taking the decision to work abroad can be a difficult one. Often it involves working away from family and friends in an environment that presents new challenges. Having the support of a respected umbrella company to take care of all your in-country tax and social premium deductions will ease these additional demands.

International Umbrella has over 23 years’ experience of contractor accountancy and international compliance solutions.  We have the required skills, knowledge and  experience, to provide the contractor, recruitment agency and end client, the complete international compliance service.

Contracting Resources

Useful information to help you when contracting abroad.