Categories: Career

Thinking about trading office politics for outcomes? You're not alone! I’ve spoken with many Quantity Surveyors who have made the switch or have expressed an interest in doing so but just aren’t quite sure how to go about it.

Because of this, I have provided a breakdown of the steps involved, including navigating IR35, insurance, and finding work. This should give you a clearer picture and alleviate any worries that the process of going freelance is potentially unattainable.

First, you need to think about what you’re looking to get out of a freelance career, and what aligns with your current lifestyle and future goals:

Benefits of going freelance:

• Greater Control: Be your own boss, set your schedule, and choose the projects you work on.

• Increased Earning Potential: Command higher day rates compared to a traditional salaried position.

• Improved Work-Life Balance: Enjoy greater flexibility to manage your time and workload as well as picking and choosing what projects you want to do.

• Exposure to Diverse Projects: Gain experience across a variety of projects and broaden your skillset by working for several clients at once if you wish. This has a compound effect on your future project potential and agility to switch projects.

• Tax Advantages (Subject to IR35): Potential to optimise your tax situation depending on your IR35 status.

Once you have decided a freelance career is the right path for you. You will need to think about taking the necessary steps to achieve this.

The process:

Notice Period and Contract Termination:

• Review your current employment contract to understand your notice period. Provide written notice to your employer in accordance with your contract terms.

• During your notice period, ensure you fulfil all your employment obligations and avoid any conflicts of interest with potential future freelance work. You are now representing your own company and building an exceptional reputation is essential.

Setting Up as a Limited Company:

• Register a limited company with Companies House. This establishes your business entity separate from yourself.

• Open a dedicated business bank account to manage your income and expenses.

• Consider seeking advice from an accountant to ensure proper financial record-keeping and tax compliance. There are several firms I deal with regularly that specialise in supporting white-collar workers in the industry to get themselves set up.

Understanding IR35:

• IR35 is a UK tax regulation that determines if a contractor working through a limited company should be taxed similarly to an employee.

• Factors like control over work, ability to send substitutes, and equipment provision influence your IR35 status.

• Consulting a tax advisor can help you assess your IR35 position and ensure compliance.

IR35 Insurance:

• IR35 insurance provides financial protection in case HMRC determines you should have been inside IR35 (classified as an employee for tax purposes).

• Having IR35 insurance demonstrates your commitment to compliance and can give you peace of mind.

Choosing an Accountant:

• Appointing a recognised accountant can ensure your taxes are filed correctly and efficiently.

• They can advise on maximising your income as a contractor while minimising tax liabilities.

• Their expertise can be invaluable in managing your financial affairs as a limited company.

Finding Contracting Work:

• There are specialist talent agencies that can help you secure contract roles that will add value to your portfolio and make you a sought-after option for future clients.

• Partnering with a specialist can keep you in the loop with the latest trends in the market and where sector skills shortages are the most keenly felt.

• They can help you keep up with fair market rates. I have previously written about how to price your services.

Remember: Transitioning from employee to contractor requires careful planning. Consider seeking professional advice from an accountant and a solicitor to ensure a smooth and successful move.