Are You Ready To Start Working As An IT Contractor?
Life as an IT contractor can be extremely rewarding. Aside from the financial benefits, you’ll have the freedom to be your own boss.
However, working this way isn’t for everybody. You’ll have to boast all the skills of a self-starter, accept that there’s an element of risk, and hold yourself responsible for the common “perks” that come with regular employment.
If you’re having trouble deciding if this profession is right for you, ask yourself these simple questions:
What rate can I command?
Prices for IT contractors will vary depending on your location. Check out other contractors in your local area to determine roughly how much you can charge. In addition, start reading the industry trade magazines and websites. These can be an invaluable source of information.
How will I find work?
Most IT contractors will work through agencies. However, some will work independently and find their own business. While going direct with clients is harder, it can be more lucrative. If taking this approach you’ll have to advertise to find clients. Most IT contractors use a mixture of online and offline methods.
How will I set up a company?
Not many IT contractors will register as sole traders (although this is an option). For tax purposes, most choose to set up as either a limited liability company or an umbrella company. With the former you’ll have higher take-home pay and more control over your finances. However, the latter is easier to set up and has no No IR35 legislation risk.
Who will do my accounting?
Accounting can make or break your business. While you can do it yourself, it’s not recommended unless you have experience. Failure to make the correct payments to HM Revenue and Customs could result in penalty charges and even a criminal conviction. An accountant will take the burden of responsibility off you and ensure everything is filled legally and ethically.
What will my working day look like?
Contracting essentially allows you to choose when and where you work. You don’t have to do the usual 9-5 routine if you don’t want to; however, you will have to adapt to the market. Sometimes you’ll be swamped with work, while other times you may be sitting around waiting for a call. This is a reality you must accept before you enter the business.
Will I develop new skills?
When you’re an IT contractor you’ll always need to be one step ahead of the industry. This means constantly staying abreast with advancements in technology and ensuring your skills always exceed those of your clients. Due to the variety of different projects you’ll encounter, you’ll naturally accumulate a better skill-set. That said, a passion for learning is a must!
Fundamentally, working as a IT contractor puts you in charge of your career. No longer will you stagnate in your job role, conducting the same tasks day-in day-out. In addition, wages in the tech industry are growing by roughly 3% each year. So if you get started now, things could become very lucrative in the not-so-distant future.
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- IR35: How It Affects You (UK)
- Uses of Umbrella Companies in small businesses
