Guide to Contracting
Why Choose Contracting?
The many benefits to contracting include:
- Attain better job satisfaction with a fresh approach and experience different sectors
- Develop new skills in new environments
- Flexible working and have control over working arrangements
- Better rates of pay
- Flexibility to work when you want to
- Get paid for the time you work
- Control over your holidays – take more holidays or less – you choose
There are two primary options for contracting supported by DDC Precision; setting up your own Limited Company (effectively starting your own business and becoming a company director) or working through an Umbrella Company (who is responsible for deducting your tax and national insurance etc).
Own Limited Company
Setting up your own Limited Company is the perfect solution for professionals who wish to be in total control of their financials and intend to carry out projects for various clients and they may wish to employ their own personnel to help with peak workloads giving them total flexibility and control.
It is advisable to appoint your own accountant to handle your affairs. You may wish your accountant to just help you with the necessary legislation, or help you with all your Limited Company tax affairs. You will be responsible for paying your own Tax, NI and VAT (if you decide to become VAT registered – seek advice from your accountant). You will also be responsible for your own company insurances. Many brokers offer an ‘off the shelf’ package specifically developed for small Limited Companies. It is advisable to also make provision for health care which is a personal option but not required as are personal Pension contributions.
Many Contractors opt to work through an Umbrella company rather than setting up their own Limited Company, especially at the outset if they are new to contracting. The benefits of this are:
- Tax and NI will be deducted on your behalf
- Expert knowledge of what business related expenses can be recovered and when
- Advice and support on legislation and other rules
- DDC Precision are associated with a number of Accountancy and Umbrella providers but do not operate a Preferred Supplier List. We can however recommend companies to you based on our knowledge of the company, previous working relationships with those companies and reliability etc.