Advise required - Pushing 40 and new to contracting

**cojak** · 8 July 2013, 08:56

So you just want to contract in order to avoid this years tax?

Good luck with getting that rate with no contracting experience, and don't believe the 85% retention rates of all of the 'wealth management' umbrella companies and 'corporate tax' spivs.

And don't worry, we certainly don't see you as a competitor...

**cojak** · 8 July 2013, 09:17

And here are the calculators for you to compare salary/day rate with Ltds and sensible umbrellas.

Calculators

**EstherA4C** · 8 July 2013, 09:22

Originally posted by WestHammer View Post

[*] Please assume a rate of £500. What will be my monthly take home pay assuming I optimize it - there are many websites and they are all contradictory? Also assume 40 hour weeks and 20 working days a month[/LIST]

I agree with Cojak that you shouldn't believe the 85% take home hype. Everyone's circumstances are different and your take home will depend on many things.

Are you planning on working through an umbrella or will you set up a limited company?

What volume of legitimate business expenses are you likely to incur?

Where will your contract fall terms of IR35?

**TheFaQQer** · 8 July 2013, 09:23

Originally posted by WestHammer View Post

What is your general feel of the market? My skills are generalist in nature - Project/Programme management, Change management, Org transformation etc.

My market is looking OK, but since that's not the same as yours (or even remotely close), that's irrelevant. You could, of course, have a look at various job sites, try punting your CV about out there and see what responses you get - if there are lots of roles and you are getting lots of interviews and offers, then it's a good market, if not then it isn't.

Try it and see.

Originally posted by WestHammer View Post

Will people run away if I ask for a daily rate of £500-£600 - is it realistic in London market?

People are more likely to run away from your lack of relevant experience than the rate that you are looking to charge. The rate is realistic enough, but whether anyone will take you on with no experience is a different question. You'll be up against experienced contractors who know what they are doing, and there is very little you can offer to compete with that.

Originally posted by WestHammer View Post

Please assume a rate of £500. What will be my monthly take home pay assuming I optimize it - there are many websites and they are all contradictory? Also assume 40 hour weeks and 20 working days a month

Calculate it. Bear in mind that if you aren't plannning on having multiple contract roles, you won't be able to claim any travel or subsistence expenses since you'll be working at your permanent work place. So put in a figure of £0 for expenses, then work out your gross, knock off your actual expenses, NI and corporation tax, and you'll get close to your net. Then work out how you want to take the money out of the company - dividends or PAYE? Or are you working through an umbrella company?

You need to work out how you are going to work, and then do the figures - no-one is going to hold your hand when you are contracting, so get used to it now.

Originally posted by WestHammer View Post

I have always held a permie job but under financial duress at the moment. So was beginning to wonder whether contracting is a right option for me.

If you are only looking at contracting to earn more money, then you're in for a big surprise. Work it out.

Originally posted by WestHammer View Post

Please note

I want to contract only for a period of 6-12 months. Want to go back to permie world once short term objectives are met

I'm not convinced that you've thought this through properly - it's not that easy to flit between job and contract and job. If you are going Ltd, are you planning to shut down your company, or are you planning to keep it open? Have you calculated the costs of each route?

Originally posted by cojak View Post

And don't worry, we certainly don't see you as a competitor...

This.

**TheFaQQer** · 8 July 2013, 09:29

Advise required - Pushing 40 and new to contracting

And it's spelled ADVICE.

**northernladuk** · 8 July 2013, 09:32

Originally posted by WestHammer View Post

Ladies/Gents

I have always held a permie job but under financial duress at the moment. So was beginning to wonder whether contracting is a right option for me. Please note

What does this mean? It is highly unlikely you can get a contract that will dovetail with you leaving perm land. Most common way to get one is to quit your gig and be ready at the drop of a hat. They won't wait 4 weeks. There is also the chance that they could bin you at any time up to you signing in (literally) so taking a huge amount of risk on if you are financially strapped. You can get binned at anytime, even in a bouyant market and then have to have a warchest to fall back on while you wait a month or two to find something. Even with all the positives you do not want to start contracting already in financial problems. It will go wrong, spectacularly.

I want to contract only for a period of 6-12 months. Want to go back to permie world once short term objectives are met

You are assuming you can jump straight in to a contract which will be very difficult for reasons above and that you are a huge risk being a newbie. Your short term view is exactly why you are a risk.

Have done IT for 20 years with academic and professional qual to back up - all blue chip firms

You are still a new contractor and a risk and there are many many experience contractors in your field out there.

Current in mid-senior level management at a top british telco

Doesn't really mean much

Can you please tell me
What is your general feel of the market? My skills are generalist in nature - Project/Programme management, Change management, Org transformation etc.

You will not get a gig as a generalist. Clients are looking for specialists in their field to fill resource gaps they cannot fill. Generalists are no good to them. A further risk to all the above already mentioned.

Will people run away if I ask for a daily rate of £500-£600 - is it realistic in London market?

For a newbie and generalist no chance.

Please assume a rate of £500. What will be my monthly take home pay assuming I optimize it - there are many websites and they are all contradictory? Also assume 40 hour weeks and 20 working days a month

None will give you an exact answer but they shouldn't be too far different?

Please don't see me as a competitor - why don't you try and dissuade me from joining the group?

Thanks

Believe us you are a not a competitor. Many people on here are seasoned contractors with years of experience. A newbie coming in for one year just to take a bit of work on under financial constraints is not going to happen IMO so not a competitor.

**TheFaQQer** · 8 July 2013, 09:39

Originally posted by EstherA4C View Post

Where will your contract fall terms of IR35?

I'd bet inside, given that he's a permie, thinks like a permie and will almost certainly act like a permie.

**kevpuk** · 8 July 2013, 09:50

Originally posted by northernladuk View Post

<snip>You will not get a gig as a generalist. Clients are looking for specialists in their field to fill resource gaps they cannot fill.<snip>

This

**northernladuk** · 8 July 2013, 10:05

Oh, just to add, it could be a little more difficult getting another permie job after contracting as well. They will be wary of your reasons to go contracting and pack it in so quickly. They may think you are going to do it again so not give you the job. So on top of getting binned halfway through you have two pretty sure stints on the bench before and after this dream contract so I can't see how this is going to help your financial situation.

Advise required - Pushing 40 and new to contracting