[amouat]

It would be a lot more useful if said what these misconceptions and inaccuracies were. It seemed generally accurate to me. I think you should either back up this comment or delete it; otherwise it's unfair to the author.

(I don't mind to sound snarky here; the rest of your comment is genuinely helpful).

[ig1]

You should absolutely not have your business bank with the same bank you use personally.

If your business account ever gets frozen (for litigation, tax investigation, etc.) many banks will also freeze any personal accounts you hold with them.

IMO many of the services he recommends also suck. I've used Crunch before and wouldn't recommend it and Barclays Business banking has a terrible reputation. £50 cashback isn't a good basis on which to chose a bank account. Get a proper accountant that specialises in contractors (Nixon Williams and SJD have decent reputations).

It also doesn't address withdrawing money out of the company (taxes, NI, pension, etc) which is a fairly important part of being a contractor.

[d_t_w]

I used Nixon Williams for about five years, they were very good.

[monkeyprojects]

Where to begin

Am I ready - The biggest bit is actually having the confidence to do it and a CV good that will get you past both the gatekeeper (the agent) and the client checking CVs... That means you should have real experience across both multiple employers and multiple market sectors (retail, consultancy, banking for instance) before thinking about it.

Timing -

Never understood this one. Projects have different life cycles so require analysts before project managers before developers before testers.

Outside of the week between Christmas and New Year there are always some companies looking to start projects or requiring another contractor to fix a problem. In fact the only time I've found it difficult to get work is in April which supposedly is a boom period due to new financial years...

Bureaucracy -

The easiest way to find contracts is through agencies. To do that you need either a limited company or to use an umbrella. You don't however need to create this before you get a contract as you can get a company created in about 4 hours..

Getting an accountant

You need one but don't need 1 until you get that first contract. Crunch has a lovely interface and is a good site but frankly I don't think they would be that great if things went wrong as they haven't got many qualified accountants. Look at IPSE or Freeagent for many other possible options..

Registering for VAT

On the flat rate scheme you don't keep 5.5% but rather .2 *.145 or 2.6% as the 14.5 is taken from the income including VAT..

Expenses

You don't need to do anything until you have a contract (as I've continually said setting up a company can be done in 4 hours). You may need to wait before you get paid (although some agencies still pay weekly) but if that is the case you keep the expenses to a minimum, keep a record of them and take the money from the company as soon as it receives that money.

Finding your first client

The first client isn't the hardest. The second one is. Especially when your first client was a short term 3 month contract and they didn't renew you because the work was done. With 1 3 month contract under your belt you then start looking for a contract as your money starts running out. That is when things are difficult.

And I'm out of time but just before I go

Mailing lists and communities

This is my real problem with this article. He doesn't seem to want to be a contractor. He wants to be a freelancer working for multiple companies on various projects. Perfectly acceptable but thats the world of code bunnies doing work for start-ups and advertising agencies rather than contracting in a consultancy firm or government department.

[lifeisstillgood]

A few things to add to this.

- put aside money Before starting try, really try, to have saved at least 1 months expenses - preferably 2 and ideally six. You won't get paid (as in a months salary in the bank) for a couple of months. companies have cycles for payments and if you are on the wrong end it can hurt

- know your tax liabilities Sit down with your accountant and write a spreadsheet or a script that tells you exactly how much tax you owe to whom given say 10,000 of monthly income. Do not leave until this is done. Read this again. Trust me from bitter personal experience. Know your tax situation

- tax "dodges". You will be approached within days by someone hoping they can sell you on a scheme where you will pay 1% tax. Loans, off shore, forget all of them. Until you can afford your own tax lawyer, you pay what HMRC tells you. Possibly the only "dodge" is if your spouse works for you and you split the shares of the company, each takin dividend payments - this way as a couple you have about 80k of income before a top rate tax is applied instead of just 40k if you are the only dividend reciever.

- good personal project management. No matter what half arsed system the client has you must always know what tickets you have, what the acceptance criteria are, and be able to report weekly to whomever. Even if you report to your Collegue or your own inbox the discipline is vital.

- have a "swapsies" partner. IR35 essentially says companies cannot exploit workers by calling them contractors. So there are several tests, the most convincing is substitutability - the idea if I am sick my company can send in another contractor just as good. Have a comtractor friend act as this person - it is a useful way to remember you are supposed to be a company not a person.

Wow - there is a lot more to talk about

[superafroman]

Shameless plug, but if you need to set up a substitution agreement with another company, i.e. a "swapsies" partner, checkout https://agree.digital. It's generally a good idea to have documentation in place you can use as proof if HMRC come knocking!

[amouat]

Thanks. That's appreciated. Hopefully the author will update the article.