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Changing from Salary to Contract work

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Comments

  • #32
    This is it
    Registered Users Posts: 5,180 ✭✭✭This is it


    Fr Tod Umptious wrote: »
    OP are you in the IT industry ?

    If so then contracting is very appealing, especially if you are young and have no spouse or kids.

    I did it for years and might go back to it once my kids get a little older.

    I have always considered that a contracting year is at most 46 weeks.
    That's when you take into account 9 bank holidays and the other days leave you take yourself.

    So make your calculations based on that.

    There are a good number of tax breaks available, like travel if a contract is 3 months or less, equipment, training, putting money in a pension etc.

    When I was contracting I used a specialist accounting company, Contracting Plus, to do all my accounts, they set you up as a director of an umbrella company which is better than setting up as a sole trader for tax purposes.
    They cost a bit but it's tax deductible and makes things a lot easier.


    I'd certainly give it a look.

    Yes, it's IT work. I'm not sure what you count as young :D one issue is mortgage application, I plan on buying in the next 12 months so that would likely have to be pushed back quite a bit. Lots to think about.


  • #33
    Fr Tod Umptious
    Registered Users Posts: 14,991 ✭✭✭✭Fr Tod Umptious


    This is it wrote: »
    Yes, it's IT work. I'm not sure what you count as young :D one issue is mortgage application, I plan on buying in the next 12 months so that would likely have to be pushed back quite a bit. Lots to think about.

    Can't help you with the mortgage thing, I got mine back in the middle of the Celtic Tiger while working as a contractor, it was no problem, but obviously times have changed.

    But that being said it might not be that difficult, if it was no self-employed or sole trader would ever be able to buy a property.

    Another thing to note is whether you go through an agency or contracting company or go completely on your own.

    The former is more popular I believe and the only way I have ever contracted, but the latter is more lucrative money wise as there is no middle man.


  • #34
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    moved into contracting around 2 years ago. Similar work to before but a lot less stressful and money is great. No office politics. Definitely give it a go.


  • #35
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    jester77 wrote: »
    Don't forget to consider all the training, up-skilling, attending conferences, equipment, etc will be out of your own pocket and you will not get paid for the days that you are doing this. It adds up to a lot every year.

    the whole attending conferences thing is hogwash. I`ve yet to meet a contractor that does this. Equipment is always supplied by client. Training can be done part time in evenings or between contracts.


  • #36
    Phileas Frog
    Closed Accounts Posts: 946 ✭✭✭Phileas Frog


    This is it wrote: »
    Yes, it's IT work. I'm not sure what you count as young :D one issue is mortgage application, I plan on buying in the next 12 months so that would likely have to be pushed back quite a bit. Lots to think about.

    I got mortgage approval after 12 months contracting, IT also.


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  • #37
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    Deleted User wrote: »
    If you are contracting remember

    1. Never get sick or need doctor/hospital days
    2. Never play sport; see above
    ...

    :D

    This thread is hilarious


    If you get sick, most positions will allow you to work remotely these days.

    Being permanent doesn't guarantee you a job for life if you are ill. I worked in a place where a guy needed time off for his illness, and when it eventually got to the stage where he was taking off too much time he had to be let go.

    .


  • #38
    Fr Tod Umptious
    Registered Users Posts: 14,991 ✭✭✭✭Fr Tod Umptious


    mrcheez wrote: »
    the whole attending conferences thing is hogwash. I`ve yet to meet a contractor that does this. Equipment is always supplied by client. Training can be done part time in evenings or between contracts.

    Training materials, courses, exams etc are tax deductible also.


  • #39
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    Fr Tod Umptious wrote: »
    Training materials, courses, exams etc are tax deductible also.

    Some places train all team members (regardless of being a contractor or no) together as well. I've received training gratis as part of my current role.


  • #40
    [Deleted User]
    Posts: 0 ✭[Deleted User]


    mrcheez wrote: »
    :D

    This thread is hilarious


    If you get sick, most positions will allow you to work remotely these days.

    Being permanent doesn't guarantee you a job for life if you are ill. I worked in a place where a guy needed time off for his illness, and when it eventually got to the stage where he was taking off too much time he had to be let go.

    .


    If you get sick/injured and can not work, you will not get paid.


    If you need surgery, you will not get paid.
    If you break a leg and cannot attend (and no remote working) you will not get paid.

    Your comment (emphasis mine) contains a very important section. Companies also do not need to pay you when sick but Social Welfare plus company top ups often mean that many many professionals will not be out of pocket for short term (up to 6 months) absences.
    Try getting that on a day rate.


  • #41
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    Deleted User wrote: »
    Try getting that on a day rate.

    That's where you can purchase Income Protection if you choose?


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  • #42
    [Deleted User]
    Posts: 0 ✭[Deleted User]


    mrcheez wrote: »
    That's where you can purchase Income Protection if you choose?

    Very true (and I should have put it in for longer absences) but that does not help if you have the flu and are out for a week or so.
    Or have to attend a doctor etc.
    Any day you are off you will not get paid for and you need to be aware of this. Many new to contracting are not aware of this.

    It's something that people do not take into consideration, especially in the lower paid placed contractor market from PFH/Westbourne/Berkley et al. Many of these people are on just slightly more than salaried (if at all) and cannot afford income protection. They are often in roles just to get experience so that they can apply for salaried roles in that area.


  • #43
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    Deleted User wrote: »
    Very true (and I should have put it in for longer absences) but that does not help if you have the flu and are out for a week or so.
    Or have to attend a doctor etc.
    Any day you are off you will not get paid for and you need to be aware of this. Many new to contracting are not aware of this.

    That's why you get paid the big bucks so that even after taking out a week or so you will still end up with more in your pocket at the end of the year.

    As I mentioned before though, in IT it's common to work from home if you are not feeling well enough to come into the office. Certainly if you are completely bed-ridden this does mean a day off, but I have a contracting colleague who frequently works from home as he has work going on in his house.

    For most people it's more of an edge-case scenario where you are completely unable to work, and certainly if you have a history of being bed-ridden from the flu then perhaps contracting isn't for you.

    It's a gamble certainly. It can pay off handsomely if you are healthy and able to work, but the income protection is there if you feel more cautious.

    As a result of contracting I'm going to be able to pay off my mortgage 5 years earlier than if I had been continuing as permanent, so that's evidence enough of the benefits for me personally.


  • #44
    [Deleted User]
    Posts: 0 ✭[Deleted User]


    mrcheez wrote: »
    That's why you get paid the big bucks so that even after taking out a week or so you will still end up with more in your pocket at the end of the year.

    As I mentioned before though, in IT it's common to work from home if you are not feeling well enough to come into the office. Certainly if you are completely bed-ridden this does mean a day off, but I have a contracting colleague who frequently works from home as he has work going on in his house.

    For most people it's more of an edge-case scenario where you are completely unable to work, and certainly if you have a history of being bed-ridden from the flu then perhaps contracting isn't for you.

    It's a gamble certainly. It can pay off handsomely if you are healthy and able to work, but the income protection is there if you feel more cautious.

    As a result of contracting I'm going to be able to pay off my mortgage 5 years earlier than if I had been continuing as permanent, so that's evidence enough of the benefits for me personally.



    I've taken advantage of remote working in IT myself but have also contracted into Labs as a technician. If you physically need to be there you need to be there.
    I have friends who still contract in that area and they are being paid more than salaried but not the the extent of IT staff. IMHO IT contracting works for many people but in other fields, unless you are an expert consultant, then it is a dangerous place to be (income protection or no)


    This is why you should have read further down the list, adding in a significant margin to cover yourself.


  • #45
    mrcheez
    Registered Users Posts: 13,616 ✭✭✭✭mrcheez


    Deleted User wrote: »
    I've taken advantage of remote working in IT myself but have also contracted into Labs as a technician. If you physically need to be there you need to be there.
    I have friends who still contract in that area and they are being paid more than salaried but not the the extent of IT staff. IMHO IT contracting works for many people but in other fields, unless you are an expert consultant, then it is a dangerous place to be (income protection or no)


    This is why you should have read further down the list, adding in a significant margin to cover yourself.

    The OP was referring to IT contracting afaik, hence that is where I'm coming from in terms of the work style.


  • #46
    [Deleted User]
    Posts: 0 ✭[Deleted User]


    mrcheez wrote: »
    The OP was referring to IT contracting afaik, hence that is where I'm coming from in terms of the work style.

    And that brings us back to contractors in PFH/Westbourne/Berkley/MMcK and the such.
    They contract in guys at lower levels and in no way would I recommend that to someone already in a "permanent" salaried role.

    It really depends on the level of the contractor. If you are a Network engineer, Senior Sys Admin, Architect, Info Sec, or Dev then yes it is well worth it as the pay far outstrips anything you can get generally.

    If you are lower to mid tier and already have a salaried job then jumping 10-15k is not worth the hassle.

    If you are going from 60-70k to 100k+? Well then it's very tempting.


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