New to this

[Island3r]

Hi

I'm currently working in a permanent IT Job but considering giving contrating a go. But I'm not sure what I need to do, I've read articles about creating a limited company or going with an umbrella but its all a bit confusing.

If I apply for a contract job and get offered the job can I just go and work for them and expect my pay at the end of the week/month and then that's that or is there a lot more to it?

Sorry if this is a silly question, I just wanted to speak to realy-world contrators instead of reading through guides which confuses me a bit :s

Thanks for your help!

[pmeswani]

Hi

I'm currently working in a permanent IT Job but considering giving contrating a go. But I'm not sure what I need to do, I've read articles about creating a limited company or going with an umbrella but its all a bit confusing.

If I apply for a contract job and get offered the job can I just go and work for them and expect my pay at the end of the week/month and then that's that or is there a lot more to it?

Sorry if this is a silly question, I just wanted to speak to realy-world contrators instead of reading through guides which confuses me a bit :s

Thanks for your help!

Firstly, ask your self the question... we are in a recession, is now a good idea to go contracting? Do you have enough money to survive on if you don't have a contract for up to a year?

If you don't understand the difference between going via your own Ltd Company and an Umbrella, it would suggest that you are not ready to go into the world of contracting by far. Do some research, read the First Time guide properly and search on the internet on contracting, there is a wealth of information out there that can be used.

You won't learn much from us that isn't already out there.

Understand the Tax liabilities (i.e. Income Tax and National Insurance - Employee and Employer, Corporation Tax (For Ltd Company), VAT (For Ltd Company - e.g. Flat Rate Scheme, What you can claim back, etc), Accounting / Management Services, Invoicing, etc, etc.) regardless of whether you go Umbrella or your own Ltd Company, learn about how much you need to generate in terms of business income, and how much your take home pay will be based on that.

We are not going to spoon feed you, go and work it out for yourself, seriously...

The asking the question you have asked the forum, you are setting yourself up for a big fall.

[Clippy]

Actually, the first question you need to ask yourself is do I really have nothing better to do than troll on an internet forum?

<EDIT: please don't comment (especially to new posters ) if you having nothing +ve to add. i personally am extremely fed up with the stock in trade (chronic) attempts this forum often presents by people who really ought to know better, all the while trying to sound like a cool, know-it-all, seen-it-all stager. if you can't give decent advice to an honest question from a newbie who deserves our support, please say nothing.

sp>

[TheFaQQer]

Hi

I'm currently working in a permanent IT Job but considering giving contrating a go. But I'm not sure what I need to do, I've read articles about creating a limited company or going with an umbrella but its all a bit confusing.

If I apply for a contract job and get offered the job can I just go and work for them and expect my pay at the end of the week/month and then that's that or is there a lot more to it?

Sorry if this is a silly question, I just wanted to speak to realy-world contrators instead of reading through guides which confuses me a bit :s

Thanks for your help!

Read the first timers guide - there is a link on the right hand side of the page.

Consider what your skills are and look to see if there is a market for your skills. Work out what the rate would be for your skillset, and compare it with what you earn now - bear in mind that advertised rate does not always equal actual rate. Work out what your costs are going to be - NI, PAYE, corporation tax, insurance, travel, startup costs, accountancy etc. etc. and see how they fit with the rates on offer.

How are you going to find work? Are you going to rely on applying to agencies, agencies contacting you, direct work for clients, your network to find you work, old clients?

In short - there is a lot more to it than "turn up, get paid".

[NotAllThere]

...
Sorry if this is a silly question, I just wanted to speak to realy-world contrators instead of reading through guides which confuses me a bit

The thing is that most real-world contractors (btw, I recommend Firefox - it has a nice spell checker facility), are able to research things for a bit themselves, don't expect to be spoon-fed, and are reluctant to help people who find it difficult to help themselves.

Try reading the guides again, and then ask specific questions about what you find confusing.

[MarillionFan]

Actually, the first question you need to ask yourself is do I really have nothing better to do than troll on an internet forum?

no wonder it's difficult to get new posters to stay on the site when you have stupid comments from the like of clippy.

2nd poster said it all.

[pmeswani]

Actually, the first question you need to ask yourself is do I really have nothing better to do than troll on an internet forum?

<EDIT: please don't comment (especially to new posters ) if you having nothing +ve to add. i personally am extremely fed up with the stock in trade (chronic) attempts this forum often presents by people who really ought to know better, all the while trying to sound like a cool, know-it-all, seen-it-all stager. if you can't give decent advice to an honest question from a newbie who deserves our support, please say nothing.

sp>

I don't know if the OP is a troll or not, so cut them some slack. We were all new to contracting, and guess what, we all know where to start. Some of us are lazy because we are not used to looking for what everyone takes for granted.

I am still naive on various aspects of contracting, and at times I am afraid to ask questions or have my knowledge challenged because of the type of response you have given.

Yes I agree it is frustrating that the same question is being asked time and time again, but give the newbies some breathing room. If the individual keeps on asking the same pointless questions time and time again, then fair enough.

[LisaContractorUmbrella]

Hi

I'm currently working in a permanent IT Job but considering giving contrating a go. But I'm not sure what I need to do, I've read articles about creating a limited company or going with an umbrella but its all a bit confusing.

If I apply for a contract job and get offered the job can I just go and work for them and expect my pay at the end of the week/month and then that's that or is there a lot more to it?

Sorry if this is a silly question, I just wanted to speak to realy-world contrators instead of reading through guides which confuses me a bit :s

Thanks for your help!

There are some agencies that will pay you direct, through PAYE, but it is more common for temporary jobs rather than contract positions.

If you work through an umbrella company you become their employee which means that they are responsible for deducting your tax and NI contributions. You will be paid via PAYE (Pay as You Earn) and your salary will be the contract rate shown on the contract between the agency and the umbrella, less an amount for the Employer's NI and less the umbrella company's fees. Unless you have another income you will not be required to complete a self-assessment for whilst working through an umbrella company.

If you work through your own Limited Company you will pay yourself in one of two ways both of which are determined by HMR&C, not you. If you are inside IR35 which means that you are deemed to be an employee rather than running business you must pay yourself through PAYE and, as an employer (albeit of yourself) you must also pay Employer's National Insurance. If you are outside IR35 you can draw dividends from your limited company.

Although the information available may seem confusing, it is in your interest to read through it thoroughly and then ask for clarification of the bits that you still don't understand. Getting it wrong, as a contractor working through your own company, can be very expensive.

HTH

[sparkymark]

Do you feel confident in your saleability?

I'd suggest that the 1st question you need to ask is will there be a good demand for the product your selling, your skillset. If you see the market as strong & your skills are in high demand then go for it. If not, it doesn't really matter what approach you take ( ltd or umbrella ) as there may not be any money to receive.

Many new contractors see the pound signs & compare it to their current permie rate, thinking they can make a lot more money. Fingers crossed this is the case for you, but, in reality I know of contractors who have had no work ( & not for the sake of looking ) in over 7 months. Money is short & their family lives are suffering, lots of arguments & stress.

On the money front, ltd or umbrella is pretty much down to the type of contracts / durations / rates / etc you expect to get. Umbrella is easy to start with & if you feel like changing up in the future ( maybe after talking to an accountant ) then you can. Umbrella is to all intents & purposes pretty much the same as being an employee. You work & you get paid. :0)

[lukemg]

If you are serious, you can test the market by applying for applicable jobs on the job boards. Make sure you declare yourself immediately available, say they are closing the dept and happy for you to leave etc. If you are getting calls back from the agency that offer a job spec/want to put you forward and don't just ask for refs, then maybe you have something to sell.
If you get no responses, maybe you don't. Forget about umbrella/ltd/tax/accountants/VAT - That can be sorted in an hour, ALL that matters is whether you can get work.
IF you can do that AND you are prepared to make the leap for 13 weeks work and uncertainty beyond that, then go for it. Current employer can probably be talked into letting you go, they know it's best if you want to leave, if not just walk/go sick - they won't do anything but don't expect a job back there. Many people go into this game when they have nowt to lose due to redundancy/return from travelling etc.
Don't underestimate bench time, I have been out for a year all together in the last 4 (longest 5 months) and I have been offered the last 6 jobs I have been interviewed for !
Good luck....