Skip to content
SJD Accountancy
Join Now
Join now
Sorry, we're closed

Lines open Monday from 08:00 - 20:00

  • Contractor Services
    • Our Services
      • Accountancy Packages
        • Compare Services
        • Essential
        • Premium
        • Elite
      • Company Formation
      • Switching Accountant
      • Tax & Audit Services
        • Self Assessment
        • Questionnaires
      • Insolvency Services
      • IR35 Contract Reviews
      • Special Offers
    • Partner Services
      • Umbrella
      • Business Insurance
      • Contractor Mortgages
      • Wealth Planning
      • Health Insurance
      • IPSE Membership
      • Rewards
  • Contractor Resources
    • Contractor Library
    • Top Guides
      • The Contractor’s Guide
      • Limited or Umbrella. The Ultimate Guide
      • Complete Guide to IR35
    • Contractor Tools
      • Limited Company Name Generator
      • Compare Your Day Rate
      • Gender Pay Gap Tool
    • Contractor Calculators
      • Take home pay
      • IR35 calculator
    • Becoming a Contractor
      • Permanent to Contracting
      • How to contract
      • Contractor earnings
      • Contracting in the UK
      • Umbrella take home pay
      • Limited or umbrella
      • Contracting through an umbrella
      • FAQ’s for new contractors
    • Existing Contractor
      • Expenses
      • Taking money out your company
    • Financial Advice
      • Business banking
      • Contractor and business insurance
      • Contractor pensions
      • Contractor mortgages
      • Off-Shore
    • Understanding Legislation
      • IR35
      • Flat Rate VAT scheme
  • About
    • Company
      • About SJD
      • Contact us
      • Careers
      • Terms of Business
      • Terms & Conditions
      • Privacy Policy
    • News
  • Clients
    • Refer to SJD
    • SJD Online
Search Search

SJD Accountancy > News and Opinion > Contractor Advice > The Top Five Contracting Myths

SJD Accountancy > News and Opinion > Contractor Advice > The Top Five Contracting Myths

The Top Five Contracting Myths

Author
Written by:Laura Nixon
Contractor Advice
3 minutes
Published: June 17, 2019 Updated: October 13, 2020
  • Twitter
  • Facebook
  • LinkedIn
  • Email

More and more people in the UK are choosing to become contractors, whether it’s due to benefits such as the flexibility of being your own boss or the increased earning potential. Indeed, as of 2018, there were approximately 4.8 million self-employed workers across the UK. However, there’s still some contracting myths flying around that may be putting you off.

In our 29 years of being specialist contractor accountants, we’ve heard them all. Below, we’ve busted the top five contracting myths for you, to help make your decision to enter the contracting world much easier.

1. There’s no job security as a contractor.

Nowadays, it’s not uncommon to have several roles over the course of your career. Indeed, a study by AAT revealed that the average UK worker will have at least 6 jobs in their lifetime. Contracting is no different, simply think of it as progression and experience.  Take advantage of the flexibility contracting offers; being in control of the roles you take and the hours you work means your work-life balance will improve.

Contracting is on the rise and, according to IPSE (The Independent Association of Self Employed), over half of UK businesses are using contract workers to gain access to specialised talent – so finding your next assignment may be easier than you think. Of course, it can be a bit of a worry when you’re reaching the end of a contract and you don’t have another lined up. Having some money saved for these instances will be a reassurance, and it could be a good idea to have at least three months’ salary in your back pocket for your own peace of mind. Furthermore, as you develop your network, your next assignments might just start to find you.

2. My income won’t be much different to when I was a permanent employee.

Incorrect! Contracting through your own limited company is the most tax efficient way of working for contractors, meaning you can maximise your take home pay.  If your skill set is in high demand, you can expect to earn even more. Calculate what your take home pay could be using our handy Take Home Pay Calculator.

3. It’s expensive and difficult to set up my own limited company.

Have no fear. This is where qualified accountants come in. Having someone experienced, who knows what they’re doing, will give you peace of mind. SJD Accountancy offers a company formation service for only £125 + VAT. However, appoint us as your accountant, and we’ll do it completely free, and take care of everything for you.

4. As a contractor, I’ll lose out on employee benefits, such as sick pay and holiday pay.

Let’s be honest, there is truth to this. However, it’s no reason to let it put you off contracting, as the benefits often outweigh these losses. Just think of the better work-life balance, increased take home pay and being your own boss, to name a few. Again, this is where planning (and saving) for every eventuality comes in, and you’ll find yourself feeling much more secure about any unplanned absences.

Moreover, as a contractor, you’ll have more flexibility regarding holidays, as you’re in control of your work schedule and when you take assignments. When calculating your finances, you should realistically work out how much time you want to set aside for holidays each year and set your rates to allow for this. This way, your finances won’t take a hit when you jet off into the sun for a well-deserved rest.    

5. There’s too much paperwork and legislation to comply with.

Alright, so this one has a bit of accuracy to it. Undeniably, contracting comes with paperwork and contractors need to keep on top of legislation to ensure full compliance, especially with the IR35 Private Sector reforms taking place in April 2020. However, it doesn’t need to be overwhelming. 

Having a specialist accountant, such as SJD Accountancy, will not only lighten your admin burden, allowing you to focus on what you do best, but will also means that you get up to date advice and guidance on legislation to make sure you’re doing everything you need to.

Why choose SJD Accountancy?

Now we’ve separated the contracting myths from the facts, you’re one step further to taking the leap to becoming your own boss. SJD Accountancy is the UK’s largest specialist provider of fixed fee, limited company accountancy services to contractors and freelancers; we’ve been acting for contractors across the UK since 1992 and have more than 15,000 clients. With our range of accountancy packages and benefits, by appointing us you’ll have everything you need to walk the contracting road confidently.

Call us today, free, and get some expert advice to help you start your contracting journey: 01442 275 789

Free Resource

Related Articles

The Six Steps You Need to Take to Become a Contractor in 2021
Contractor Advice
2021 Self Assessment Tax Return Checklist
Contractor Advice
How to Become a Self Employed Influencer
Contractor Advice
Coronavirus and Contracting: Looking After Your Mental Health
Contractor Advice
How to turn your lockdown side hustle into a full-time career
Contractor Advice
Contractor Pensions – Practical Tips and Options for 2020-21
Contractor Advice

Back to top

Contact Us

  • 0123456789

Useful Links

  • Terms & Conditions
  • Recruiters
  • Privacy
  • Slavery Statement

New Business Hours

Monday - Thursday8:00 AM — 8:00 PM
Friday8:00 AM — 7:00 PM
Saturday10:00 AM — 4:00 PM
SundayClosed

Copyright SJD Accountancy 2021. All rights reserved. SJD Accountancy Ltd is a company registered in England & Wales. Company Registration Number 06277058.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish.AcceptReject Read More
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled

Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.

Non-necessary

Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.