Hi All. Strong possibility I may be offered a freelance contract (4-6months long) and I'm trying to work out whether just to go with an umbrella company or set up my own company. I don't intend to freelance as a long term thing, but, who knows... this contract might extend, or I might find I love it.
What do you reckon? And which umbrella company is better? Giant or Parasol? Also, can I register with them even if the job is not confirmed? I've been told to sort this piece out while they arrange their side (no talk of money or anything yet)
Hiya. Would be a sole trader, so have been told by everyone it's really easy, but the tax worries me as I'm absolutely crap at those kinds of things and have no experience (have always relied on paychecks and never questioned it.)
Am quite excited about having a company name etc, though
Soopermum - only worth setting up a company if you're turning over a certain amount a year - something like 45k, though you will need to check that. You'll probably also need an accountant to help you, especially if you're crap at tax (like me, thank God for my acc. And he's a sweetie.)
I would stick to an umbrella company for the first contract and then see how you go. Also query why the company won't take invoices from a sole trader - so annoying of them, though more and more people seem to want to be invoiced by an LLP or other formal company nowadays.
It can be worth setting up as a Ltd Co from the word go - it depends on the business on the other hand, some VERY large businesses (like JD sports) are still sole traders so that there are NO public disclosures (which is why the Middleton family business is a private partnership)
for the first contract I'd be amazed if they will not accept you as self employed after that, see how it goes
Thanks for the advice so far. Company has asked me to set up as sole trader or ltd company. No mention of Umbrella company, so have queried that. The contract is potentially 4-6 months. I would expect the rate to be about £60k p.a.
The intention is not to freelance forever, but, who knows, I may love it, and this contract may run for longer. So, really, I'm looking at something simple (but good value for money, I want as much money in my pocket as poss) with opportunities to scale up if this looks like a longer time gig, either in this company or with contracts elsewhere.
Wow, I've seen some out-of-date information on mumsnet, but that just about takes the biscuit. JD Sports listed in 1996 and is currently a constituent of the FTSE 250.
Many companies will not take on self-employed freelancers, they don't want the risk of an HMRC status enquiry. If they are OK with it, and you are not committed to freelancing, the self employed route is probably best, but if you can set up a Ltd company with an IR35-proof contract it will cost you £600-£1,200 a year but could save you 10% of what you earn.
PAYE umbrella companies like the two you mention are a slightly different matter. Do a bit of reading around the subject on the PCG web site or a specialist site for your profession.