Is contracting right for you?
Contracting in the UK opens up a wealth of opportunities. You can control your own business affairs, but how do you get set up? Talk to our friendly team for help laying out all the options for becoming a contractor.
Are you considering contracting? Do you want more autonomy or are you looking to shift to a more flexible working schedule? There is no doubt that becoming a contractor has its benefits. However, for those who are considering leaving their permanent role, the prospect of becoming more self-reliant securing your own contracts might seem daunting. We’re here to provide all the information you need to embark on your contracting journey.
At ContractingWISE we have many years’ experience helping contractors and those who are ready to start their journey in contracting. We know that it is not always an easy step to take, so we’re here to provide information and support so that you can spread your wings.
What do I need to consider before starting my contracting journey?
There are a number of considerations for those moving from permanent to contracting. Not only will it impact on your private life, but also on the way you manage your personal finances. You’ll also find yourself needing to brush up on your knowledge of certain employment and business legislation.
First and foremost, you will need to consider how you will set up. Will you use an umbrella company or set up a limited company? This will dictate a number of decisions, like do I need to hire an accountant? If you use an umbrella company the answer is no you won’t have to find yourself an accountant, but if you set up a limited company, you might be wondering how to find a good accountant.
Contracting sounds problematic, will it be right for me?
Unfortunately, there are a lot of myths and misconceptions which surround the practicalities of contract work, and often dissuade permanent employees from taking the step of becoming a contractor. Contract work may seem difficult initially, with new paperwork and a different working structure, but the benefits of contracting can help you to overcome these challenges.
Dispelling the myths
I’m ready to start my career in contracting. Where do I begin?
First of all, if you’re confused at where to begin you can speak to one of our contractor specialists.
Call 0203 642 8679, OR request a free call back.
If you’re raring to go, you can follow these simple steps to get started:
1. Research your market
Whether you work in IT, Management Consultancy, Finance, Healthcare or Oil & Gas, the contracting market is built on the same principles. It’s highly important to do your research though, and see where you fit in to the mix. Consider your skills, and what clients are looking for. A good way to find this information is by checking job sites to see what contracts are available, and what the desired skills are. You can also chat to your contacts in that sector, or recruiters, who will be able to give you a flavour of the market. You may face fierce competition for the lucrative contracts, so make sure you are clued up before pitching yourself.
2. Set yourself up
You can’t start a contract until you have a means to invoice and receive funds for the work you do. Setting yourself up as a contractor will involve a choice between establishing a limited company, or choosing an umbrella company to work through. At ContractingWISE we work with umbrella companies, so can provide you with options if you choose this route. You may wonder what’s the difference? Operating via a limited company is the most tax-efficient way to contract, but there are increased legal obligations and you will spend more time on paperwork. Using an umbrella company will omit these obligations, but for a fee. Find out more about the differences here.
3. Make sure you’re insured
Much like when you move house or buy a new car, for becoming a contractor you will need to make sure you’re suitably insured. If something were to go wrong during your contract period, you won’t be protected like a permanent employee, and you could be held liable by the client. We explain the types of insurance here.
Ready to launch your contracting career?
Read our handy guide on making the leap.
Why not read our first-time contractor tips on LinkedIn?
We have a special page purely for first-time contractors, so if you’re looking for some tips to help you along the way, follow our ‘Becoming a Contractor’ page here:
Read about a day in the life of a contractor
Read our guest post contribution from Henry Sharples, a Chartered Mechanical Engineer with over 20 years’ experience working as a contractor in rail safety.
Finally, Find a Contract
When you’re just starting out, it might be easiest to search for contracts via an agency. For your very first contract this will be helpful, as you can get tips on how well positioned your CV is, and adjust it accordingly. Agencies will also be able to help you set your rates, and let you know if you’re competitive.
Don’t forget though, recruitment agencies take a cut when placing you in a position, normally a margin of around 15%-20% of your contract value. Once you have started to get a name for yourself you may wish to source your contracts yourself. You can do this via networking with existing contacts and clients in your sector, applying directly via job sites, or by using social tools such as LinkedIn to boost your network and increase your visibility.
Ready to go?
Request a free consultation with one of our friendly team today. We’re here to provide options and answer all your questions.
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At ContractingWISE, we’ll ensure that you have genuine, objective and accountable information so that you can explore the options and make a wise choice.