Changing from PAYE to Limited Company contracting can be daunting, but with the right guidance, the journey can be made much simpler. We’ve helped numerous people get ahead in the world of contracting and freelancing within data, product, UX and engineering over the years. In our experience, sometimes the best time to start is after a redundancy when there’s no concern about notice periods or risk-taking in terms of giving up a permanent job. If that sounds like you then you might find our six expert tips for a hassle-free setup helpful.
Quick Check Guide for 2024:
- Choose a Company Name:*Start by picking a unique company name and domain. Visit Companies House to check availability. Remember, don't spend too long on this step – your name needs to be functional, not beautiful!
- Professional Email Address: Set up a professional email address to maintain clear client communication lines. Consider Google Suite for a comprehensive package including email and document storage. Easy to use, smart and around £5 per month.
- Company Setup and Support: The contracting world moves rapidly and requires an efficient and expert setup process. We've discovered that using the expertise of professional agents specialising in this area tends to provide a smoother transition than relying on local accountants. For those seeking guidance on a quick and effective setup, we offer access to our network of trusted partners. These partners not only provide discounted rates but also offer bundled invoicing software and complimentary advice. For a seamless start, contact us at contracts@consortia.com, and we'll ensure you're connected with the best resources available.
- Business Bank Account: It's crucial to have a dedicated business bank account. While high street banks are an option, we now recommend digital banks like Tide or Starling for quick setup and seamless integration with accounting software like Xero or Freeagent. This ensures that your business finances are handled efficiently and professionally. [Tide](https://www.tide.co) | [Starling Bank](https://www.starlingbank.com)
- Choosing the Right Insurance: Ensure you have the necessary insurance for the project. As standard we ask for £1m Professional Indemnity, £1m Public Liability, and £10m Employers Liability. These are not just compliance measures but also indicators of IR35 compliance. Visit [Hiscox](https://quote.hiscox.co.uk/business-insurance) for quotes.
- Invoicing Best Practices: For those opting to manage invoicing independently, it's important to understand that while free bundled software can facilitate this process, there are specific guidelines to ensure compliance. Invoices must be sequentially numbered (for example, 001, 002, 003...) and should not start with the company name followed by a number. Each invoice should clearly include vital details such as the company name, registration number, address, VAT registration number (where applicable), invoice number, days worked, rate, VAT amount, and the total due. Importantly, all payments should be made to official business accounts, as personal bank accounts must not be used for invoice payments under any circumstances.
Remember, staying organised and informed about the latest practices is key to a successful transition into contracting. For more information, advice, or support on transitioning to contract work in the UK visit https://www.itcontracting.com/
Ready to Launch Your Contracting Career?
Your journey into limited company contracting is an exciting step towards greater flexibility and potential in your professional life. Whether you're just starting or looking to navigate your next contract our team of experts is dedicated to connecting you with the best contract job opportunities in data, product, UX, and engineering. With personalised advice, comprehensive setup guidance, and access to our curated network of resources, we're committed to ensuring your transition is as smooth and successful as possible.
Visit our jobs page for all the latest contract opportunities tailored to your skills and ambitions. Or, for a more personal touch, reach out directly to one of our team members. We're eager to learn about your goals and help you achieve them.
