Contractor Payroll in UK

Positioning a candidate internationally means navigating unfamiliar tax and payroll systems. Not only does this generally mean more work for you, but even small missteps can have serious financial or even legal consequences. 

Whilst many recruitment agencies payroll contractors in the UK, they are basically just adding to their workload with increased administration and stress... but this doesn't stop the contractors from treating the recruiter like their personal account manager if a payment is late! 

If you want to successfully place a contractor, you should first familiarize yourself with the contractor payroll process in UK, as well as how you can make the situation simpler.

Contractor Payroll in UK

Payroll options in UK

There are several different options for payroll in UK:

  • The client can provide payroll for the contractor, but not all clients offer this for temporary workers.  
  • The contractor can do it on their own, but this creates serious risk for the end client and possibly your agency, as well. Like most people, many contractors do not specialise in UK’s tax system, nor do they always have the time or means to pore over complex tax returns.
  • Your contractor can use a local payroll company.

The third option is the simplest and quickest. An even simpler and quicker option is to use an Umbrella Company (or, "contractor management company"), as they offer the same services as a local payroll provider in addition to other services that simplify international assignments. By using a management company, you give your contractors access to the best possible take home pay, whilst ensuring they are fully compliant with HMRC legislation. Furthermore your agency is fully protected.

Check out our FAQ for specific quotes on payroll providers and Umbrella Companies. 

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