Thinking about accepting a contract for £13 an hour and wondering what sort of a return you’ll get when using a standard PAYE Umbrella Company like Quad Management?  You’ve come to the right place, here we give a full breakdown of what you’ll get back and what you’ll pay out and to whom.

First of all as with all payroll calculations we’ve got to make a few assumptions about you, we are going to assume you don’t want to contribute to a pension and have the standard 1250L tax code.  We’ll also assume that you’re going to be working 8 hours per day and 5 days per week on your contract, sound fair?  

£13 per hour X 8 hours X 5 days gives you a weekly Gross Contract Value of £520.  That £520 is what the end client will be billed for your services that week.  From this the first thing your Umbrella has to do is deduct their fee (in Quads case this is £15), your employers NI and the Apprenticeship Levy.  You are going to pay £40.47 Employers NI and £2.31, on top of the £15 Umbrella margin that gives a total of £57.78 in deductions and £462.23 available for your gross pay.  

The payroll calculation for Gross to Net pay is the same as for any PAYE employee, the only difference being that your Umbrella shouldn’t withhold holiday pay and should show it separate, but at the end of the day it’s all your Gross Pay.  Income Tax on £462.23 is £44.33 and Employee’s NI £33.51.  That’s going to give you a Net weekly return of £384.38

Want to know what you’ll get back on £13 per hour with a PAYE Umbrella?  Assuming 8 hours per day and 5 days a week it will be approximately £384.38, or if you’re looking for a percentage then 73.92% 

(All figures correct as at September 2020)