Yesterday the start of the 30 day writing challenge from Marc Jenkins. For my first post I wrote about why I like being a contractor. I originally wrote this post on Medium, but for the rest of the 30 day challenge I’ve decided to just use this site.
For today’s article I’m going to continue writing about life as a contractor, part of a series I’m going to call the Contractor Chronicles.
So if you want to become a contractor in the UK there are two main ways you can go about this. Either be a Limited company or work for an Umbrella company. For me I decided to be a Limited company.
If you don’t know the difference between the two is when you are a Limited company you work for yourself as an employee of your own company. If you work for an umbrella company, then you work as an employee for that larger company. They handle all paperwork, the invoicing, the tax and accounting aspects of running a company. As a Limited company you are responsible for all these jobs (though you can and should get an accountant to handle the tax and accounting parts of running a business).
I went for the Limited company route the reason for this is if I decide later to be a company that sells a product (apps for example) then this is easier to do as a Ltd company. Also if I wanted to grow the company and get employees it’s far easier to start this as a Ltd company.
I prefer the Ltd company approach. It may not be for everyone, yes there is paperwork to do, but with tools like FreeAgent, this is so much easier. So if you want to be a Ltd company, get registered, get a good company name (PooWoo Tools is not a good name), get an accountant and get started, good luck…..