Reply to: First contract

[LisaContractorUmbrella]

Agents recommend brolly's and accountancy firms. Although I doubt its about backhanders anymore.

What makes you think that Moggy?

[kevpuk]

Good luck, and as others have said, get Accountants sorted straightaway - they should be able to get YourCo setup in no time, and all the other bits and bobs, and should also be able to offer pretty good advice on the do's and dont's

[ijwrighty]

I'm going Limited Company. I'm going to speak with SJD at lunch time. The company in question have stated that they want me and are willing to wait. They are a reputable company so hope that they wouldn't mess me around. Again thanks for the advice.

[TheFaQQer]

I have just been offered my first contractor role through an agency. Currently, I am full time and want to hand my notice in ASAP.

Fingers crossed you either have a short notice period or they are willing to wait for you.

The agency who have placed me are suggesting that I set up via an Umbrella Company so I can get my company setup quicker and therefore get the contract on Monday.

That just doesn't make sense. They suggest going via an umbrella so that you can get a Ltd company set up quicker??

Once the contract is signed, she then says I can transfer to a Limited Company (which is what I want to run as).

They would need to terminate the agreement between agency and umbrella and form a new one between agency and limited company. If you follow this advice, make sure you know your termination rights with the umbrella before going that route.

[moggy]

And no doubt they are willing to do you a favour by introducing you to a brolly they have dealt with before = a nice backhander for the pimp

Agents recommend brolly's and accountancy firms. Although I doubt its about backhanders anymore.

[texto]

Hi All,

I have just been offered my first contractor role through an agency. Currently, I am full time and want to hand my notice in ASAP. The agency who have placed me are suggesting that I set up via an Umbrella Company so I can get my company setup quicker and therefore get the contract on Monday. Once the contract is signed, she then says I can transfer to a Limited Company (which is what I want to run as).

Does anyone have any advice for me with regards to this please (pros/cons etc)

Many thanks in advance

Limited definitely. You can get set up in a couple of days - the accountant can open the company and bank accounts. There are loads of them in accounting/legal forum. They will have a few options - go for the expensive option since you don't have much experience in being the director of your own company. The expensive option (roughly a grand/year) - the accountant sorts everything out including your tax return and VAT, end of year returns etc. Their intro pack will explain everything.

I would recommend you (I mean your company) purchase PCG membership that covers you on the legal side (about 160/year) and indemnity insurance (about 500/year).

The agency would simply need your company name and company bank account to start with. VAT info can be provided later on. They may also require you to purchase indemnity insurance (read the contract) that covers you up to a million or two in damages.

[lukemg]

Let an accountant do all this. SJD I think will sort the company, bank account etc for you in a day or 2 especially if you dont care about the name.
Can recommend Jamie-Leigh at the Manc office if you are ooop north.

[LisaContractorUmbrella]

I'm in the same boat as you and I went limited company. Why? Well it's the difference between 75% take home and about 60% you get under umbrella. That's no small margin and money's hard to come by these days.

The way I see it, this contracting gig is going to involve picking up some new concepts and I just see the limited company thing as one of those. If you employ an accountant (SJC Accountancy or Nixon Williams seem fine to me) they can largely do it for you.

For the sake of what could amount to hundreds or thousands of pounds off your original contract alone I would go for a later start date and ignore anyone who wants you to get into an umbrella to start monday. It makes no difference to the recruiter so they're not as interested in your personal wellbeing here.

I reckon you could get it all sorted in a couple of weeks. Initially all you'd really need to get to start would be a limited company name (go to the companies house website, costs £15 and usually delivered next day) and a bank account (takes a couple of weeks, you can use a high street bank or your accountants can set you one up, it needs to be a special business bank account and not your personal one). Also make sure you get Professional Indemnity Insurance, costs about £150 from Morethan or Hiscox and available same day. Your accountants can also register you for VAT, which means you can charge VAT on your services and possibly pay VAT itself at a lower rate (keeping the extra for yourself).

The list of things above is what makes some people feel defeated and go with an umbrella but I got all mine sorted out from a position of knowing nothing, like you, a few weeks ago and I reckon you could do it . The benefit would be enough to buy you a small holiday per month. For the sake of a little bit of admin (which can be done in stages, not all of it needs to be ready on day one) by the time you start the job you'll have the same day to day activities as an umbrella person but with loads more money.

If they just need a company set up to write the contract, you could have that active from Tuesday anyway.

I think you need to quantify what you've said here - the returns from a Ltd Co can be around 75% but only if you are outside IR35; you can have what you like written in a contract but if it isn't a proper representation of your working practices it will mean squat if HMRC come calling

[mudskipper]

What a superb forum!

That's 'cause NLUK is off duty.

NorthernladUK Comment generator

They're over there ---->

[ijwrighty]

Hi Gardener. Can you expand a little further please?

[gardener]

Hi All,

I have just been offered my first contractor role through an agency. Currently, I am full time and want to hand my notice in ASAP. The agency who have placed me are suggesting that I set up via an Umbrella Company so I can get my company setup quicker and therefore get the contract on Monday. Once the contract is signed, she then says I can transfer to a Limited Company (which is what I want to run as).

Does anyone have any advice for me with regards to this please (pros/cons etc)

Many thanks in advance

In case of LTD you will also have to deal with a crappy contract that an agency will give you, pushing you out of your rights, making you take all the risk etc.

[TykeMerc]

What a superb forum!

Massive thanks to all. Im going to setup Limited Company and at least get the name up and running so I can still get the contract for next week.

That's entirely doable.

You can set up a MyCo Ltd in a few ways, they're all fast and not expensive.

1. Do it yourself - Companies House have fairly simple forms
2. Buy "off the shelf" from a formation agency
3. Engage an accountant (many post on here) and they can sort it for you. As it's your 1st contract having the services of an accountant is wise.

I hope it all works out well for you

[PerfectStorm]

And no doubt they are willing to do you a favour by introducing you to a brolly they have dealt with before = a nice backhander for the pimp

I was told "we're not allowed to recommend a company, but lots of people use X..."

[ijwrighty]

What a superb forum!

Massive thanks to all. Im going to setup Limited Company and at least get the name up and running so I can still get the contract for next week.

[kal]

Hi All,

I have just been offered my first contractor role through an agency. Currently, I am full time and want to hand my notice in ASAP. The agency who have placed me are suggesting that I set up via an Umbrella Company so I can get my company setup quicker and therefore get the contract on Monday. Once the contract is signed, she then says I can transfer to a Limited Company (which is what I want to run as).

Does anyone have any advice for me with regards to this please (pros/cons etc)

Many thanks in advance

And no doubt they are willing to do you a favour by introducing you to a brolly they have dealt with before = a nice backhander for the pimp