For those who are thinking of taking the leap into the contracting profession, or for all of you veterans who want to swat up on on your industry knowledge, here are our ‘Top 5’ things to consider when contracting.
When taking the leap into contracting, one of the first, and most important things to consider is getting a contractor accountant. Your accountant will be able to set you up with a limited company efficiently and compliantly, and advise you on how best to operate both cost effectively and tax efficiently.
IR35 is a buzzword that you will no doubt have already heard. It is something that all contractors should be aware of and can have devastating results on those who find themselves caught ‘inside’ the legislation. Compliance is essential, and you should always seek advice from your contractor accountant, and for added peace of mind, get your contract reviewed by a specialist as soon as you receive it from your agency.
Insurance is one of those things that we’d rather not have to take out, but for freelancers and contractors, it is essential. Most contracts stipulate that business insurance is mandatory in order to start work, so all of you working through a limited company should ensure that you seek professional cover before starting a contract.
4. Your Profile
As a contractor, you are the owner, the worker, and the face of your business. Because of this, building a professional profile is very important to keep your head above the parapet should you ever find yourself out of contract. LinkedIn is increasingly becoming the most popular jobs board out there, and an up to date profile could be the key to landing your next job.
5. Have a War chest
As a contractor, you may find yourself out of contract from time to time, or ‘on the bench’ as some people call it. As a result of this, it is very important that you put some money aside for these periods of time. Building a ‘war chest’ can be a valuable asset should you ever have to wait weeks or months until your next job, or if you just fancy taking some time out of work.
The article outlines the typical tax payment dates and methods of estimating the values of tax payable for each type of tax, including VAT, PAYE, NIC, CIS, Corporation Tax, and Dividend and Personal Taxes.
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