Time to convert

[pmeswani]

If you are serious about contracting, go LtdCo. from the start. When you start shopping around for an accountant, you could ask if they will sort that out for you; many will.

Disagree with that. In some scenarios, it would be cheaper to go down the brollie route (such as rate and IR35). I started off with an Umbrella, as I wasn't sure if me going contracting would work.

[malvolio]

Disagree with that. In some scenarios, it would be cheaper to go down the brollie route (such as rate and IR35). I started off with an Umbrella, as I wasn't sure if me going contracting would work.

Rubbish. Do the sums (properly!). The lowest return against gross income is by Umbrella users (even less than permies unless you're cheating the expenses). Even inside IR35, you net more with your own company.

95% of the time, you use an umbrella ieither becuase you can't be bothered with the (trivial) hassle of running your own company and don't mind throwing away income, or you are just starting out and need to focus on the work rather than the administration and legalities.

[kaiser78]

Rubbish. Do the sums (properly!). The lowest return against gross income is by Umbrella users (even less than permies unless you're cheating the expenses). Even inside IR35, you net more with your own company.

95% of the time, you use an umbrella ieither becuase you can't be bothered with the (trivial) hassle of running your own company and don't mind throwing away income, or you are just starting out and need to focus on the work rather than the administration and legalities.

Agree - never opt to go for the brolly option over ltd co. It is simply not financially advantageous.

[RichardCranium]

Disagree with that. In some scenarios, it would be cheaper to go down the brollie route (such as rate and IR35). I started off with an Umbrella, as I wasn't sure if me going contracting would work.

I said "If you are serious about contracting, go LtdCo. from the start". You weren't. So you don't disagree, you agree.

Edit: sorry, that sounds harsh. I don't mean it that way. I have never used a brolly, but I can imagine cases where it would suit some people occasionally, temporarily. Specifically, someone who is unsure, or someone who knows they are going back to permie within a year or two. In that case, it is financially less worthwhile, but why have all the aggro of learning how to run a LtdCo - and dammit, Daddy, there is a hell of a lot to learn about rock and roll, sorry, running a LtdCo - when you could just turn up and take the money, if that is what one wants?

It's a lifestyle decision, and provided one does the research and makes an informed decision, either brolly or LtdCo might be right.

Edit 2: a scenario. A 12 month contract comes up to do some networky stuff in a war zone for £1,500 per day + all expenses + bodyguard. The intention is to get married in 18 months. You could do the gig under a brolly, come back, buy a house outright, then forget you ever went and go back to being a permie with a pension. No fear of the tax man chasing you later because of a contract re-interpretation, no keeping 7 year's records, no paperwork, nothing.

[MPwannadecentincome]

The lowest return against gross income is by Umbrella users (even less than permies unless you're cheating the expenses).

Where are the sums for permie vs brolly please - this intrigues me how the brolly net is worse than permie esp as permies cannot claim commuting expenses.


EDIT sorry question withdrawn answer is at http://forums.contractoruk.com/916112-post30.html - I never saw that answer as I was away from CUK for a few days

[dkennedy1001]

Thanks for the replies.

I can see that taking a risk is just part of the whole contracting ethos hence the rewards.

I will go for it when I am more trained then the average contractor in my field so as to create my own luck.

Cheers