Umbrella vs PAYE: Which is Best for Education Recruitment?
When it comes to choosing how you’re paid as an education professional, two of the most common options are Umbrella and PAYE (Pay As You Earn). At JobsinED, we’ve made a clear choice: we pay all our candidates exclusively via PAYE. Here’s why PAYE is the better option for you.
What Are Umbrella and PAYE?
Umbrella
- Umbrella companies act as intermediaries between you and the recruitment agency, handling your payroll but often deducting fees from your earnings.
- Fee Structure: They charge weekly or monthly fees that reduce your take-home pay.
- Tax and National Insurance: Both are deducted by the umbrella company as part of their service.
- Hidden Costs: Some umbrella companies charge for extras like expense processing, further impacting your earnings.
- Employer National Insurance Contributions Passed to You: Many umbrella companies deduct the employer’s National Insurance contributions (13.8%) from your agreed rate, meaning you effectively cover what should be the employer’s responsibility.
PAYE
- PAYE is the standard system where you’re employed directly by the agency or company. It’s straightforward and transparent:
- No Hidden Fees: You’ll only see standard deductions like tax and National Insurance.
- Employee Benefits: Full entitlement to sick pay, holiday pay, and maternity/paternity leave.
- Simplicity: Tax and compliance are handled for you, so you don’t need to worry.
Why We Only Offer PAYE
At JobsinED, we’re committed to transparency, fairness, and ensuring you get the best deal. That’s why we exclusively pay our candidates via PAYE. Here’s how this benefits you:
- Higher Take-Home Pay
Unlike umbrella companies that deduct fees, PAYE ensures what you earn is yours—no hidden charges. You can maximize your income without worrying about extra deductions eating into your pay.
Example: If you earn a daily rate of £100 under PAYE:
- Tax and National Insurance Deductions: Approx. 20%-25% (£20-£25)
- Take-Home Pay: £75-£80 per day (excluding any additional entitlements like holiday pay).
With an umbrella company, after their fees and deductions (including employer NI), your take-home could drop to £65-£70 per day or lower. - To see how much you could earn, try this PAYE Calculator to calculate your take-home pay accurately.
- Statutory Benefits
As a PAYE employee, you’re entitled to:- Paid holidays
- Sick leave
- Pension contributions
- Maternity or paternity leave
- These benefits are often unavailable or come at an extra cost with umbrella companies.
- Less Stress, More Clarity
PAYE is straightforward, with no confusing payslips or unexpected deductions. Everything is handled transparently, giving you peace of mind. - Compliance You Can Trust
PAYE ensures full compliance with HMRC regulations, so you never face surprise tax bills or legal complications. Your contributions are handled correctly from the start.
Why This Matters for Education Professionals
Navigating payroll options shouldn’t add stress to your career. PAYE offers the financial stability, simplicity, and benefits you need to focus on what truly matters: making a difference in education.
At JobsinED, we’re here to make your recruitment journey smooth, transparent, and rewarding. Say goodbye to unnecessary fees and complications, and join a recruitment agency that puts your interests first.
Still Have Questions? Let’s Talk!
If you’d like to learn more about how we manage payroll or why PAYE is the right choice for you, don’t hesitate to get in touch. We’re here to support you every step of the way.
Join us today!
Explore our latest opportunities and experience the benefits of working with a recruitment agency that prioritises fairness and transparency.