Umbrella companies: what they cost and what you take home

An umbrella company employs you and runs payroll for a fee, but employer's PRSI also comes out of your contract income. The full cost, against your own company.

An umbrella company employs you on paper. The client pays your day rate to the umbrella, which takes its fee, pays employer's PRSI, and pays you the rest as salary through PAYE. You avoid running a company, and you are an employee for PRSI, with Class A cover.

Where the money goes

The fee is usually a fixed amount a week or month. The bigger cost is employer's PRSI, which the umbrella deducts from the contract income because the client isn't paying it separately. In 2026 it is 11.25% of all pay for anyone paid more than €552 a week, rising in October 2026 and again in October 2027.

A contractor billing €450 a day for 210 days, €94,500 in all, paying fees of €1,300 a year:

Against your own company

Now take the same contract through a limited company with €3,000 of running costs. With an €18,000 salary and the rest paid out as dividends, it leaves €56,083.89. That is a difference of €685.22 in the umbrella's favour. A director who owns the company usually pays Class S PRSI, so there is no employer's PRSI. But the company pays corporation tax and you pay tax on dividends. See salary or dividends.

Comparing umbrella quotes

Fees are quoted in different ways. Over a year of 46 working weeks, a quote of €25 a week plus a €150 set-up fee costs €1,300.00; €30 a week with no set-up fee costs €1,380.00. Ask each provider:

• whether the fee is charged every week, or only weeks you invoice;
• whether employer's PRSI, holiday pay and pension are taken from your rate or paid on top;
• how quickly you are paid after the client pays.

To compare quotes, use the umbrella costs calculator. For all four ways of contracting, see contracting in Ireland.

Work it out

• Umbrella company costs: compare two quotes →
• Umbrella or limited company: take-home compared →
• Contractor or PAYE job: which pays more? →

Sources

• Department of Social Protection: PRSI Contribution Rates and User Guide 2026 (SW14): employer 9%/11.25%, 9.15%/11.40% from 1 October 2026, €552 threshold (checked 24/10/2026)
• Revenue: Corporation Tax: basis of charge (12.5% trading, 25% non-trading and excepted trades) (checked 25/10/2026)
• Citizens Information: Social insurance classes (PAYE workers with unearned income over €5,000 pay PRSI) (checked 16/10/2026)
• Revenue: Dividend Withholding Tax (25%) (checked 16/10/2026)

General information, not tax advice. HeyPenny is not a tax agent.