Our team is experienced and professional and we are here to help you through every step of the process of becoming an employee of Pendragon Consultancy right through to getting your first salary and beyond.

Umbrella employment provides you with the security and advantages of being employed without the hassle of worrying about payroll or company accounts. You are employed under an overarching contract of employment enabling you to work in multiple short term assignments under one tax code and via one employer. Giving you peace of mind as we take care of the rest.

How can we help?

We understand that contracting is demanding and we want to take the stress out of dealing with the administration for Tax, National Insurance and Pension. Using Pendragon Consultancy means that you will get expert, dedicated support, a great package with plenty of benefits combined with receiving your pay on time.

Our industry leading packages all include high levels of expert advice, a friendly but professional service from our dedicated relationship advisors, together with access to our benefits offering Pendragon benefits & rewards, where you can make up to £1,000 of savings per year from top retail brands through our partners PerkBox.

We work with agencies throughout the UK, and across a wide range of sectors. We can help you regardless of which agency finds you the work, and if we don’t know an agency, providing you give us the details, we are always happy to get in touch and work with them.

The Pendragon approach means we treat all our employees as individuals, so we can offer advice based on your needs. We are here to help make contracting easier, to answer your questions and to help you get on with your job without worrying about being paid or about tax matters.Getting started is easy. Just get in touch today and we can get you registered  Call our team on 0800 888 6066.

What is an Umbrella Company

  • The Umbrella company acts as an employer to agency or end user contractors.
  • There is a three-way relationship – the worker (contractor), the Umbrella company and the client.
  • The client will pay the Umbrella company who makes the relevant deductions and then pays the worker (employee).

Anyone employed under this three-way relationship through an Umbrella company is classed as an employee and entitled to the same employment rights as any other employee from Day 1.

When an Umbrella company is involved, payment for work is agreed between the Umbrella Company and hiring agency, where a business to business contract is put in place. The Agency then send payment for the work carried out by the employee direct to the Umbrella company, which then retains all employment costs including company margin; this is known as the Invoice Rate. The balance becomes the employees gross pay from which Income Tax and NI deductions are made, and the employee is paid the net salary by the Umbrella company.

What are the benefits of Umbrella Employment?

  • Working as a Pendragon employee means IR35 will not be relevant to you, so no need to worry about it.
  • As an employee you don’t need to worry about AWR or MSC risk. It can be a good solution if you are contracting ‘in between’ jobs as there is minimum input required. But we can work with contractors at any level with any length of contract.
  • It’s easy to manage your finances. Your payslip will show how much you have earned and how much has been deducted for tax and your wages will be paid directly into your bank account, via faster payment. This means you have the security of knowing exactly how much you will earn and when it will arrive in your account as you’ll receive a text notification once payment is made.
  • When you work with Pendragon you become an employee and your salary is paid via PAYE. This means you can continue to work on multiple assignments and enjoy the same benefits as any other employee, for example you are entitled to statutory benefits which include SSP, SMP, SPP, Pension, Holiday Pay.
  • As your employer Pendragon can reimburse legitimate expenses as long as they are incurred during a work assignment. There are strict rules about which costs and expenses can be claimed and paid depending on the type of assignment you’re working on and whether it’s subject to SDC (Supervision Direction or Control. Read our full guide on  Expenses Explained for more information.

Choosing an Umbrella Company

Every Umbrella company uses the same PAYE calculations to work out how much tax you need to pay, but there are still some important things to think about before you choose which company to work with.

Questions to ask:

What margin will the company retain? This varies from company to company, so make sure you find out before you sign up.

What support do they offer? Knowing you have access to a dedicated advisor means that if you ever have any questions or problems you know you can get an expert answer quickly.

What benefits do they offer? Check what benefits, if any, you will get as part of your package. Attractive benefits might be worth paying a little more for, so weigh that up as part of your decision.

What’s the small print? Check minor details like how often, for example weekly or monthly, and what day a company pays to ensure these suit you.

• Check that you are offered genuine employment and not self-employment with tax deducted, and that you are provided with a contract of employment.

• Always do your homework to make sure you are using a reputable and compliant Umbrella company as whilst most operate within the tax legislation some do not. Look out for an accreditation such as FCSA.

• Some promote schemes that are based outside of the UK and claim to allow you to keep more of your income by reducing your tax liability with claims of 80-90%. Salary is paid in two payments one PAYE one loan payment.

• Agency referrals, where the agency is getting a kick-back from an Umbrella company and not concerned with service, accuracy or compliance. The highest referral fee takes precedence over which service would be the most suitable for the worker.

• Promises of HMRC and QC approval. HMRC do not approve any payment solutions and QC approval is funded by the Umbrella company /scheme operator and their lawyers to circumvent the legislation, the worker is then left to pay any outstanding tax liabilities.

• You should be very wary of these claims as such arrangements leave you at risk because you are ultimately responsible for your tax affairs and ensuring you are paying the correct amount of tax.

Why do Agencies want me to use their suggested Umbrella companies?

This is a very common question that is queried by contractors. Along with why can’t I chose my own Umbrella company. Recruitment Agencies are responsible for the compliance in their supply chain and therefore typically set up a preferred supplier list (PSL) or and approved supplier list (ASL) with umbrella companies they would prefer to use or meet their compliance requirements. In some situations an Umbrella company you want to use will not appear on the list. that doesn’t mean they are not compliant or provide a good service. This can be frustrating to you as a contractor because you have to change umbrella companies frequently. Agencies also receive rebates from some Umbrella companies or offer a lower margin to be on the PSL, and therefore the agency is not willing to work with other Umbrella companies.

Pendragon works with over a 100 agencies and seeking to work with more to provide our contractors with more choice.

Impacted by IR35 Changes?

Off- Payroll Reforms also know as IR35 has been delayed by the Government until April 2021

Most companies had already started preparing for the changes from April 2020, and you may have been asked to join an Umbrella company. It is likely that companies which already made the change, may not change back and you may not have the option to use a PSC across all your assignments.

If you’re thinking of changing, speak to Pendragon.

• An FCSA umbrella employer
• Dedicated contractor advisor,
• Multiple daily payments,
• Workplace pension (NEST)
• If you have a SIPP we allow salary sacrifice
• Pendragon Perks discounts at major retailers

What is my employment status?

All contractors working through an umbrella company sign a full Contract of Employment and are classed as full-time employees. Although you’re working on temporary assignment, you’re not classed as self-employed for tax purposes. Your umbrella company will take care of all applicable taxes and administration on your behalf.

How do I claim SSP?

To claim Statutory Sick Pay (SSP), tell your employer the first day that you are sick. Check with your employer how you should tell them.

You must have proof of sickness if you’re off work for more than 7 days in a row (including non-working days).

The rules are different if you started your sick leave between 10 December 2021 and 26 January 2022. If your sick leave began on or within these dates, you only need to give proof if you’ve been off work for more than 28 days in a row (including non-working days).

Proof of sickness can be any of the following:

  • an ‘isolation note’ if you’re unable to work because of coronavirus (COVID-19)
  • your notification from the NHS or public health authorities if you’ve been told to self-isolate because you’ve come into contact with someone with COVID-19
  • a ‘fit note’ (or sick note) if you’re off sick for another reason
  • a letter confirming the date of your procedure if you’ve been advised to self-isolate before going into hospital for surgery

What is the cost of the services you provide?

Umbrella companies retain a margin from the agreed contract rate which is received from your agency or end client. Pendragon Umbrella’s margin starts from £95 per month, or £22 for weekly paid employees. For the salary sacrifice pension solution the margin is £120 per month or £30 per week. This margin is the only money we earn and there are no additional  or ‘hidden’ costs and our margin along with all statutory deductions is shown on the reconciliation page of your payslip.

What insurances am I covered by?

As our employee, you’ll be covered by the following insurances:

  • Employer’s Liability insurance, up to £10,000,000
  • Public Liability Insurance, up to £10,000,000
  • Professional Indemnity Insurance, up to £10,000,000
  • Drivers Negligence Insurance up to £5,000,000
  • Medical Negligence Insurance up to £5,000,000

All our employees are covered by our insurance – there’s no additional charge

Do I need to be concerned about IR35?

As a contractor, you’ve likely come across IR35 legislation – it’s legislation designed to ensure that ‘disguised’ employees, working through their own Limited companies, are paying the same rate of tax as an employee. There is no need to worry about IR35 as you are an employee of Pendragon Umbrella and all taxes and deductions are managed and paid by us, which also means you do not need to complete a self-assessment.

What happens when I register?

Registration is completed online or can be done over the telephone. You will then be sent an email with your username and details of the documentation that we will require from you to complete the registration process. You will also be contacted by  one of our dedicated advisor, who will remain your primary point of contact throughout your employment with us. Your Contract Manager will contact your recruitment agency or end client, take care of all administration required and confirm the details of your assignment. You’ll need to accept the assignment on our online portal to confirm that you’re happy to begin working.

What happens if I don’t have a P45?

If you don’t have a P45 from your previous employer, you’ll be put onto a temporary tax code. This code is dependent on your circumstances during the year.

Typically, HMRC will update your tax code within two weeks of us processing your first payment, so you’re unlikely to stay on a temporary tax code for long. If you end up overpaying tax under the temporary code, it will be refunded to you in your first payslip after we receive an updated code.

How and when will I be paid?

You’ll be paid as soon as we receive funds from the agency or end client. Unlike some umbrella companies, all of our payments are made by same day transfer with no additional fee – this means that money will be in your account on the same day that it arrives in our account( subject to the time it arrives and unless you are paid on a set date). Providing cleared funds are received into Pendragon’s bank account between 9am and 4.30pm, we will make payment to you the same day.

You will receive notification that you’ve be paid by text once it has left our bank account, along with the net pay amount . Once the payment is processed, you’ll also be sent your epayslip, which includes a reconciliation page showing all deductions.

How secure are your systems?

Pendragon Umbrella takes the security of its systems very seriously and we have a range of cyber security protections which include Enterprise level firewall cluster, intrusion prevention and multifactor authentications across all of our IT infrastructure. Our system is replicated and backed up both locally and offsite to two different Tier 4 different data centres incase there is a failure in one. Whilst we can never provide 100% assurance, we certainly go over and above the advised requirements, not only for the size of our business but in the money we invest.

Cyber Security Insurance up to £1,000,000

For further information please get in touch


High Oak Business Centre, 15/17 Gentlemens Field, Ware, Herts, SG12 0EF