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Contractor wannabe!.. need advice on some steps.

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    Contractor wannabe!.. need advice on some steps.

    Hello everyone

    Like many out there I'm considering to enter the world of contracting; however I've always been permanent and as such I need some enlightenment about a couple topics: the contract itself and IR35:

    Say I would leave my current permanent job, set my ltd company (like everyone else - with help of an specialized accountant company) and finally get an actual job. My first question arises - in the act of doing the physical contract for the job I applied for (and actually secured it) is the responsibility of whom - me or the client?

    -If mine, there any "templates" you would recommend?
    -If the client, would I participate on it to "ensure" I would fall ouside IR35?

    My second question is in regards to IR35. Lets say I have my contract done. I would then send it to my accountant so she could read it and "approve" it would fall outside IR35. Is this the process you do for all contracts?

    Now she says it is "likely" to fall outside. If there is an inspection and HMRC concludes it is inside, I would have to pay back the tax/NI I owe. What's the limit in time when this can happen? My concern is to have an inspection that founds a contract Inside IR35 years later from it and I'm actually with no "funds" to pay back that to IR35.

    I'm digesting a lot of information in regards to contracting, thus I think I'll post more questions in the future, but these are bugging me and I cannot find the answer anywhere I search!

    Thank you in advance!

    #2
    If you can't find the answers to those questions, perhaps you aren't really in the best place to consider contracting...

    Not sure I understand your fist question, but the point is you are (or will be) an independent supplier of services to your client. Everything is your responsibility; the job is not being a programmer or whatever, it's being a contractor. Learn how to do it.

    As for IR35, you could Google the "Potted Guide to IR35" for the 5 minute introduction, or you can read the guides listed on this site and the Guide to Freelancing at www.pcg.org.uk (and have a really good look around that site while you're there).You don't fall outside IR35; either you are operating as a business of you aren't and that is determined by three key conditions

    PCG also provide template contracts should you need one; even if you don't have a read of theirs for an idea of what a good IR35 contract looks like.

    Do all that and you may then be able to ask more focused questions. Right now you have no idea how much you don't know.
    Blog? What blog...?

    Comment


      #3


      Welcome to CUK.

      Beasting of newcomers by those who should pick on someone with their own postcount is regu;lar here.

      Client will usually propose the contract. You can then get it IR35 reviewed if you want. Your accountant won't do that - there are companies that will. HMRC have so few successes you will almost certainly be fine.

      Personally I would join PCG for the IR35 insurance. Then take the contract.

      Best of luck

      BP

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        #4
        Welcome sir and I wish you very good fortunes.

        one day at a time

        Comment


          #5
          "Beasting" with a purpose. The biggest change between permie and contractor is that you're on your own with no support network and lots of people trying to take advantage. It's not all fluffy and light and monster income, you have to work at it. So the first lesson is something of a reality check; the answers to all the OP's questions are easily available and easily found with a little bit of effort.

          The problem for the wannabe contractors however is a little more subtle; how do you know what questions to ask when you know little about the subject? And which ones are actually important; you will note the OP is asking only about contracts in the context of IR35; do we assume they know about working practices, how to get paid, VAT registration, company bank accounts, finding work...? How about the gap between leaving permiedom and getting a contract...?

          Lots of important questions that they may not know to ask. Hence, get reading first.
          Blog? What blog...?

          Comment


            #6
            Thank you so much for the answers, the PCG advice/suggestion was really nice as I was aware of doing insurance to protecting myself, but didn't know about the benefits of being PCG member - which happen to be really great.

            @malvolio
            Perhaps the idea I gave with my thread was that I read some articles for 5 minutes and jumped straight to this forum asking questions - well that's certainly not true and I actually think my questions are legitimate.

            The way you replied; well, it's really a good start for someone new to avoid this world completely. I won't argue that I know little to nothing, because I simply can't at this point. However, I cannot agree when you say I'm not in a position of consider contracting - if I'm not, why should I even care about learning more? ... I'm not ready for contracting? For sure. Will I start tomorrow? Certainly not. My target would be to kick off in 9-12 months and prepare myself professionally (I want to finish a project at my current company first, which will take time) and personally.

            It may seem impossible but you could have said everything you did, but put in some more easy words - you know, if in contracting we are on our own out there (your words) when seeking some advice here, all we don't need is that chilliness. And what bothers me is that your message is important, you are actually trying to warn a new forum member, which I sincerely appreciate, but... in the wrong way.

            @BrilloPad
            Thank you! I've checked and PCG also have templates so I should be fine in case I need to write the contract myself.

            I'll stay tuned and will try to keep myself active around here

            Comment


              #7
              Don't take it personally, I'm like that with everyone. And don't forget we see that self same question in one form or another every few weeks.

              However, it did goad you into answering my unspoken question, which was how much have you really thought about the extent of the change you are contemplating. Which clearly you have; not everyone does, and are seduced by the doubling of the income and the freedom to wok when and how they want (neither of which is actually true...)

              And you will note I did actually point you at the PCG resources, the Guide to Freelancing should be your bible and Plus membership these days is a no brainer.

              You've actually made a good start; hope it goes well.
              Blog? What blog...?

              Comment


                #8
                There's also lots of really useful newbie guides over there ---->

                NorthernladUK Comment generator

                Comment


                  #9
                  Thank you malvolio for those words - they are much encouraging! I appreciated the fact you pointed PCG, specially the "bible" which I already downloaded and started to read - a must have so far.

                  Yes - I want to enter with the right foot into contracting and by giving a window of some months prior to it will also help not making this by any sort of "impulse", but in total conscience.

                  There's a lot to read and digest... so let's keep working.

                  See you in a bit

                  Comment


                    #10
                    Sockie alert. Whose though, I'm not sure...?
                    I was an IPSE Consultative Council Member, until the BoD abolished it. I am not an IPSE Member, since they have no longer have any relevance to me, as an IT Contractor. Read my lips...I recommend QDOS for ALL your Insurance requirements (Contact me for a referral code).

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