Has anyone pin pointed why the contract has gone tits up - been a while

[Wobblyheed]

Been out for nearly 6 months now. House up for sale, credit cards maxxed out. Pension was eaten up by covid. I'm 63 and about to become homeless. Wtf has happened.
Been contracting as a tester for over 20 years and never been out for more than a month. Used all the funds in the company account so owe VAT and soon to be Corp Tax.
Bankruptcy an option? Don't know how it works. Christmas looms...Have lots of life insurance - seems the best option for the kids. I've had enough of agents and umbrella companies and ******* IR35. Well done the government, you have finally broken the freelance contractor!

[hobnob]

I remember having some bleak thoughts a few years ago, when I was between contracts. Like you, I'd maxed out my overdraft and credit card, and I had life insurance, so I lay awake at night thinking "I'm worth more dead than alive". However, I eventually found something, and hopefully you will too.

Do you still have an accountant for your limited company? If so, talk to them about the VAT and corporation tax. See this thread for someone else in a similar position:
Outside IR35 and my Ltd Business - Contractor UK Bulletin Board

I'd also recommend talking to your family. I'm guessing that your kids are now adults, so maybe they'd be able to help you out - I'm sure they'd prefer to have you around a bit longer, rather than getting their inheritance a bit earlier.

If you need to sell your house in a hurry, you could put it up for auction. That means that on date X (within a couple of months), someone will definitely buy it, as long as your lower limit is reasonable. However, there are some upfront costs associated with that (e.g. you have to get a survey done rather than the buyer).

Good luck, and I hope you find something.

[jamesbrown]

seems the best option for the kids

However dark your thoughts, it really, really isn't the best option for anyone.

All the other stuff is just a sideshow, even though it doesn't seem like it right now.

Speak to your family and get professional help.

Good luck.

[Fraidycat]

Im guessing you meant 'why the contract market has gone tits up'

High central bank money printing and government spending after covid, coupled with supply shortages after covid caused inflation.

Centrals banks didn't react in time thinking it was 'transitory'. Interest rates had to be jacked to 5%+, now the UK economy has almost zero growth due to those high interest rates.

How much equity do you think you have in your house?

Things should start picking up within the next twelve months as and interest rate cuts are expected next year.

There is personal bankruptcy and Ltd company bankruptcy.

HMRC will eventually take steps to wind up your Ltd company, if you cant pay the VAT and corp tax.

You don't want to declare personal bankruptcy if you have lots of equity in your house.

[Cookielove]

I know how you feel it’s really is dire at the moment …I’m the same I’ve had a gutful of agencies, umbrellas, IR35 etc etc. Can’t take much more of it.

Don’t do anything silly just try to hang on…even look at something else …friend of mine doing Amazon deliveries to pay the bills …could you do that or get a shop job? Am looking at these avenues too…M&S take older people for shelf stacking. It’s far from ideal but needs must.

They’ve broken the freelancer it’s bad …if I was younger I’d leave the U.K. it’s a tulip show.

[escapeUK]

Sorry to say this, but a large part of it will be your age. You are about the same age as a very good friend who has a history of being Managing Director at various successful firms. His CV is brilliant, his interview technique second to none (he really has the gift of the gab), and is very smart and experienced.

Even with all this he struggled so much to get a role, and having got one it only lasted 18 months as they started struggling financially, and as it was a family firm, with him being the only senior person who wasn't family, he was made redundant again a few months ago.

The UK seems to be very ageist. As others have said I would take any job you can get to get some money coming in. The contract market might pick up, but you'll still be in 60s and out of work for previous 2 years. Though personally I think a huge recession / depression is more likely.

But I would also reflect on how you had 20 years of generous contracting wages and yet somehow didn't clear the mortgage. Also, you say you have been out of work for only 6 months? How on earth have you gotten in such dire straights in 6 months? You'll have heard us all talk about war chest, why did you not build one? Should have been years of emergency funds in there.

Good luck!

[northernladuk]

But I would also reflect on how you had 20 years of generous contracting wages and yet somehow didn't clear the mortgage. Also, you say you have been out of work for only 6 months? How on earth have you gotten in such dire straights in 6 months? You'll have heard us all talk about war chest, why did you not build one? Should have been years of emergency funds in there.

Good luck!

To be fair that's what absolutely everyone is thinking and there are some threads to bring it up. I think most didn't think this was one of them.

[JustKeepSwimming]

To be fair that's what absolutely everyone is thinking and there are some threads to bring it up. I think most didn't think this was one of them.

Careful mate, people will start thinking you have a soul. You're a bit of a tit if you tell someone venting about their cancer "probably shouldn't have smoked all your life, lol".

OP, it's Xmas, so contract market is especially rough, but there should be plenty of seasonal work in retail you could try, bit of money coming in and more importantly it should help you out mentally.

I would also arrange a meeting with a debt advisor. Someone who will spend some time unpicking everything and formulating a plan. For example, there needs to be 12 months of default on your mortgage before a lender can begin legal proceedings, in reality if you engage with them you'll get much more time.

Finally, knock the ageist tulipe on the head. Maybe it's true, maybe it's not. The more you fixate on it the more likely its going to interfere. That goes for all the isms.

[Wobblyheed]

Im guessing you meant 'why the contract market has gone tits up'

Yes, Contract Market.
Reasons for my dire straits 1. Sent kids to private school 2. 7 months out for covid and pension disappears 3. Was getting back on my feet with some decent contracts and regrettably bought a bigger house last year with a small mortgage intending to pay off in 4 years. Idea was to sell after mortgage paid off, downsize and semi retire. You win some lose some

[JustKeepSwimming]

Yes, Contract Market.
Reasons for my dire straits 1. Sent kids to private school 2. 7 months out for covid and pension disappears 3. Was getting back on my feet with some decent contracts and regrettably bought a bigger house last year with a small mortgage intending to pay off in 4 years. Idea was to sell after mortgage paid off, downsize and semi retire. You win some lose some

If you have a lot of equity in your house then I don't think you're in as dire straits as you think. You certainly aren't bankrupt.

Your company debts are still your companies. I've seen no evidence that companies that genuinely went to tulip because of covid are having their corporate veil pierced.

Unsecured debts like credit cards rarely ever get to point as touching your house, provided you don't bury your head in the sand. I don't know your circumstances, and some might not like it, but if someone tells me they are struggling with unsecured debt I would always advise putting in an affordability complaint.