The Begining....

[diagonalbatman]

So...

I have been offered a contract position with a cloud consulting firm, this would be my first foray into the world of contracting after being in permie work with a large SI for 10 years since leaving uni.

Will be leaving a permie role which earned me £115k in the last 12 months, contract is worth £675 a day for the first six months. Work is for a consultancy, and rate is inclusive of any travel to regional locations in the UK, rather than billable as extras (e.g. If consultancies customer was in Manchester, it may require 2-3 nights in Manchester, or London etc - expected to be covered out of the rate).

I am a bit unsure really if this is a good move or not - dropping from a senior position into the brave new world, it has always appealed to me - but could do with some words of advice, a little nudge in the back to help me make up my mind.

Would be doing this via a LTD co, and would be looking for a tax efficient structure (Married with two kids) and new mortgage (which will need renewing in September to avoid SVR) - any advice on how best to approach would be gratefully appreciated.

Also - what is market buoyancy like at the moment? Prospects of an extension sound good on this offer - but.... i would never take that for granted. I am Hampshire based, close to a London Mainline station also so commute isn't an issue.

[northernladuk]

I hope you've got some clear requirements if your are paying for your own travel and stay over. You'll be swallowing up to 100 quid a day and if they start to take the piss it's going to seriously affect your net rate.

Only using the information you've given I'd be struggling to give up a 115k wage for a 675 a day rate that could quite easily be less that 575 for a good chunk of of the gig.

[eek]

See the threads in The Future of Contracting

From April 2017 chances are any public sector work will be inside IR35 and the great unknown is that this may extend to the private sector in April 2019 (its unlikely that it could be implemented by April 2018 so 2019 is a better bet).

Given what you earn on a permanent basis £675 to include all expenses within the UK isn't a good rate. You currently earn approximately £500 a day on a permanent basis once you exclude holidays and a few sick days / training courses).

[SlipTheJab]

Over 100k a year perm, stay perm.

[jamesbrown]

Financially speaking, it really doesn't make sense to drop a 115k perm role for a 675pd contract role, inclusive of T&S. You may have other reasons, but money shouldn't be one of them with those comparables. I wouldn't worry about extensions. A contract can (and frequently does) end instantly if the client decides that there's no further work to complete, notice period or otherwise.

[eek]

Over 100k a year perm, stay perm.

Unless made redundant (and only saying that as I've got a friend in that boat at the moment).

[kaiser78]

But are your reasons for moving to contract purely financial, which everyone seems to have assumed, or otherwise ?

[northernladuk]

I can spell beginning and I'm on nowhere near that rate

[ChimpMaster]

£675/day is no where near recompense for £115k permie salary, financially anyway. You might have other reasons for choosing contracting, but this offer is not worth it on financial matters alone. On that salary I'd be looking for at least £750/day and more like £1k/day.

[ruasonid]

£675/day is no where near recompense for £115k permie salary, financially anyway. You might have other reasons for choosing contracting, but this offer is not worth it on financial matters alone. On that salary I'd be looking for at least £750/day and more like £1k/day.

Agreed. And likely you would struggle to achieve those rates and might not like the pressures that come with them.