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HMRC internal manual

National Minimum Wage Manual

From
HM Revenue & Customs
Updated
, see all updates

Specific occupations & special groups: composite service companies, umbrella companies and managed service companies

Umbrella companies. composite service companies and managed service companies are companies that can offer schemes aimed to reduce the amount of tax and National Insurance contributions paid by an individual. They are set up to provide the services of individuals to client businesses.

Umbrella companies, composite service companies and managed service companies operate in a number of different areas of business, including the construction industry, teaching, IT services, accountancy and medicine. The administrative relationship between the businesses can be complicated. Sometimes clients will be found via employment or recruitment agencies rather than directly by the umbrella\composite\managed service company itself.

When considering entitlement to the national minimum wage consider the relationship between the parties to determine whether the person doing the work is a worker under national minimum wage legislation and determine their status (NMWM04000). National minimum wage entitlement arises in the normal way depending on whether the individuals are workers under national minimum wage legislation (NMWM05020), partners (NMWM05060), agency workers (NMWM05110) or directors and/or office holders (NMWM05140).