To help you make a well-informed decision, Umbrella Supermarket has put together this guide outlining the key differences between hourly rates vs daily and the pros and cons of each, so you can choose the best route forward.
When charging the client for their time, contractors can either charge by the hour or by the day.
With an hourly rate, the contractor is paid for each hour worked, whilst with a daily rate, the contractor will charge a set amount per day.
There is also a third option - charging a fixed price. Here, the contractor will charge a fixed price for carrying out the entirety of the work. Although this can work for some, generally many contractors find it difficult to accurately predict how much time a project will take and therefore how much they should charge.
The first step to deciding whether you will charge hourly or daily rates is to decide on how much you will charge for your time and services.
If you are a seasoned contractor, you may already know how much to charge for your time. If you are new to contracting, however, you will need to work this out.
There’s no one size fits all when it comes to contractor rates. They will vary from industry to industry and depend on the skill and experience of the contractor in question.
However, to gain a good grasp of how much you can charge, you should carry out your research.
Firstly, have a look at what other contractors in your industry are charging, this will give you a good idea of rates in your sector. It can also be useful to look at permanent salary points in your industry. Many contractor roles have permanent role equivalents, so finding out the salaries for these roles can help you work out how much you can charge.
However, it’s important to remember that contractors are hired for their short-term, specialist skill sets meaning they can usually charge more than their permanent employee counterparts and will also need to account for tax, national insurance and pension contributions in their rate.
Once you’ve done your research and decided on a suitable contractor rate, it can often become clear whether it would be better for you to charge by the hour or day. After all, contractors that are charging higher rates of around £400 per day, or £50 per hour, will usually charge by the day as charging by the hour would mean less money earnt.
However, it isn’t always as clear cut as this, meaning every contractor should look at the pros and cons of both options to make a well-informed decision.
With a daily rate, contractors are paid by the number of days worked. This is usually best for those that charge a higher fee of around or upwards of £400 per day.
The advantages of charging a daily rate include:
However, like with most things, there are also drawbacks to this route including:
On the other hand, when it comes to an hourly rate contractors are paid by the number of hours worked. This is usually best for those that charge around or up to £40 per hour.
The advantages of charging by the hour include:
The drawbacks of charging an hourly rate include:
Now you know the pros and cons of charging by the day or hour, you can make a decision that’s right for you.
When it comes to choosing how you will charge your time, there is no right answer. After all, no two contractors are the same, meaning the way you charge for your time will largely depend on your contractor rate and personal preferences.
Once you’ve made the decision, the next step is to find the best umbrella company to work with. That’s where Umbrella Supermarket come into play.
With our award-winning umbrella calculator, contractors can quickly and easily find the best umbrella company for their needs in just 2 minutes. Simply enter a couple of details and we will show you a list of umbrella companies best suited to your needs. We will even show you what your payslip would look like under each company, so you can make the right decision. We won’t take your information and then call you later, we give you instant results so you can make the best decision.
Any contractor considering switching to an umbrella company will want to know how to find the best provider to work with.
Although you could spend your precious time and energy searching the web for the best umbrella company, there is an easier way – using an umbrella calculator.
In this guide, Umbrella Supermarket explains why every contractor should use an umbrella calculator in 2021.
If you are considering contracting you will need to decide on PAYE or umbrella.
It can be a difficult decision to make and contractors will inevitably be questioning which option will be the best for them.
To help every contractor get on the right track for them, in this guide Umbrella Supermarket looks at PAYE vs umbrella, outlining the key differences and how this will impact you.
There are many reasons that contractors across the UK opt to work under an umbrella company.
Umbrella companies offer an easy way to contract and remove the need for the contractors to worry about the burdens of admin, finances, tax and IR35, all things that limited company contractors have to deal with.
For this reason, many contractors will be weighing up their options and questioning whether it is worth using an umbrella company in 2021. To help make the decision that little bit easier, Umbrella Supermarket has put together this guide on the pros and cons of using an umbrella company.
Any contractor that is considering operating through an umbrella company in 2021 will need to understand Umbrella Company fees - from why an umbrella company charges fees, how they are paid to how much the contractor will pay.
In this guide, Umbrella Supermarket answers those all-important questions to help every contractor know exactly where they stand when it comes to umbrella company fees.
If you’ve made the decision to contract through an umbrella company in 2021, you will next need to find an umbrella company that’s right for you.
After all, there are lots of umbrella companies out there, so how do you know which one to choose?
To help you find the best umbrella company for you, in this guide Umbrella Supermarket outlines what makes a good umbrella company, so you can rest assured you’re making the right move.
One of the many advantages to operating through an umbrella company for contractors is that they become an employee of their chosen provider.
In turn, this means that the contractor will be automatically enrolled onto the umbrella company’s workplace pension scheme.
To help contractors find out more about umbrella company pensions Umbrella Supermarket has put together this handy guide.
If you are considering contracting through an umbrella company you will naturally have questions and queries over how they work.
After all, making the move to umbrella can be a big step for contractors. To help, in this guide Umbrella Supermarket explains how to get started with an umbrella company and share our top tips for using one in 2021.
PAYE or umbrella is a question asked by every contractor. Which one you opt for will have a big impact on your contracting career and lifestyle. So, it's important to make the right decision for you.
To help makes things a little bit easier, Umbrella Supermarket has put together this guide on PAYE or umbrella, outlining the key differences between each, to help you make the best and most informed decision for you.
One of the many benefits to working through an umbrella company is that you will receive holiday pay as well as a range of other statutory benefits including sick pay, maternity and paternity pay.
To find out more about umbrella company holiday pay, and how to calculate how much you will be entitled to, Umbrella Supermarket has put together this handy guide.
Contractors must make several decisions throughout their contracting careers. One big decision contractors have to make is how they will operate.
One way that contractors can work is through an umbrella company.
Umbrella companies have become an increasingly popular way to contract in the past few years, offering many benefits to the contractor. But, how do you know whether this option is right for you?
To help every contractor make the right decision for them, in this guide, Umbrella Supermarket explains when not to use an umbrella company.
There are tons of benefits to using an umbrella company, which is why they have become such a popular option for contractors in recent years.
After all, an umbrella company takes away the stress and hassle of operating through a limited company whilst offering contractors a range of advantages, such as statutory rights, paying them a salary, deducting correct tax levels and National Insurance, and taking care of tasks like expense processing and invoicing.
However, as more and more contractors opt to use the services of an umbrella company, more providers have started to claim that they are HMRC approved.
To bust the myths around HMRC approved umbrella companies and get straight to the facts, in today's guide Umbrella Supermarket look at whether HMRC approved umbrella companies really exist, so you know exactly where you stand.
If you're considering making the leap to contracting, you will understandably want to know how much you will have to pay in umbrella company costs. After all, this amount comes directly out of the contractor’s pocket, so it’s important to be clued up on how much you should expect to pay.
To help contractors, in this guide Umbrella Supermarket answer the all-important question of how umbrella companies cost in 2021.
