For some, contracting can be an intimidating prospect. Working in this manner does come with some degree of uncertainty and risk however the pros certainly outweigh the cons.
Essentially, as a contractor you work for a fixed period of time under a contractual basis, usually through hourly or daily rates and are hired for the unique set of skills you possess. As businesses grow, along with the expectations for them to remain flexible, many companies turn to contractors to fill any skill gaps they may find themselves with.
So, if you’re unsure whether to make the move into the world of contacting, here are 6 reasons why it might be perfect for you.
Increased flexibility
Permanent employment usually dictates a very set pattern of working and you will be expected to maintain these set days and times with little flexibility.
However as a contractor, you have the ability to dictate much more flexibility with your working life, including the time periods you work and even the hours. Having this option can be great for individuals trying to juggle a busy family life.
Financial benefits
Commonly, the average wage of a contractor tends to be higher than that of a permanent employee. The reason behind this is because clients seek contractors to fulfil a certain need within the business or for a particular project that requires a specific skill set, and so clients will pay higher rates to have access to these flexible resources.
However, higher pay rates are not the only financial benefit. Operating as an umbrella company contractor means you are able to offset allowable business expenses against tax, which in turn leads to a higher take-home pay. For individuals that opt to work through a limited company, they are also able to draw some of their funds as dividends rather than paying themselves a full salary, again reducing the overall tax burden.
Increased autonomy
Working as a contractor means you have more of a say as to when, where and how you work, freeing you from the traditional constraints you might feel as a permanent employee. Having this level of autonomy leaves many contractors with much greater job satisfaction.
Enhanced career prospects
Operating as a contractor means you will move between various companies and for some even industries. This not only gives you a fantastic opportunity to network and build relationships with many industry professionals, but also diversifies your skill set and professional experience, boosting your CV.
Still entitled to many permanent employee benefits
It is a misconception made by many that when you move to contracting you lose all the statutory benefits you had as a permanent employee. However, this is not the case for umbrella company contractors because they become employees of the umbrella company and therefore are still entitled to statutory benefits such as sick pay and maternity pay.
Avoiding office politics
It is not uncommon for permanent employees to become entangled in office bureaucracy and politics, which for some can lead to lower work motivation. Operating as a contractor means you are able to avoid this as your focus is to complete the task or project you have been brought in specifically to carry out, without becoming emotionally involved.
Of course, as with anything there are risks involved with this way of working, the most predominant of these is the uncertainty of continuous work. However with attractive financial benefits, greater flexibility, increased autonomy and the opportunity to experience a variety of roles, companies and even industries, contracting can offer fantastic professional and personal fulfilment.
This article was provided by our friends at PayStream a leading supplier of accountancy services to contractors and freelance workers.
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