There are many benefits to using an umbrella company over other payroll alternatives.
As an employee, you have full entitlement to state benefits like Statutory Sick Pay, Statutory Maternity Pay and a State Pension. The umbrella company acts as your employer and so can provide a continuous record of employment which can assist with loan and mortgage applications.
As the director of a limited company, you would have to handle all your administration regarding your payment and ensure that you are compliant with all the associated rules and regulations. You would have to file your tax returns and ensure your tax contributions are paid on time. Joining an umbrella company saves you the trouble as you become a PAYE employee.
If you are new to contracting, you can work under an umbrella company to see how it goes. You can be up and running in a matter of hours with an umbrella provider.
A standard 336 minimum guaranteed hours per 12 months are generally provided for in contracts, meaning you will be paid at least 336 hours a year regardless of their contracts. This represents one working day per week of paid work.