Greater flexibility
Traditional employment usually dictates a very set way of working as your day-to-day working routine will have little variation and you will be expected to work set hours with little flexibility.
However, when working as a contractor you may have the ability to dictate greater flexibility with your working hours, which is especially beneficial for parents who are trying to juggle work and family life.
You will also find that you move between different industry sectors, allowing you to continuously build your skills set and develop your knowledge from a variety of companies and roles.
Financial benefits
For the most part, the average wage of an umbrella or limited company contractor tends to be higher than that of a permanent employee. This is because when clients look to use a contractor, it is to fulfil a particular business need, generally for a specific project that requires a specific skill set, so they will pay extra to gain access to the necessary flexible resources. If your skill set is particularly niche or highly sought after you will also find that you have greater leverage when negotiating higher pay rates and better conditions.
However, it is not just higher salary expectations, but a contractor's ability to claim expenses that leads to higher take-home pay. This is because when working as an umbrella or limited company contractor you are able to offset allowable business expenses against tax. Also when contractors choose to work through a limited company they can draw some of their funds as a dividend rather than being paid a full salary, so their overall tax burden is reduced.
Greater autonomy
As a contractor you will have the ability to dictate when, where and how you work, leaving you free from the usual constraints you might experience as a permanent employee. With this control comes greater motivation as you will find yourself doing roles you actually enjoy.
Greater career prospects
Unlike traditional employment, as a contractor, you are not tied to a single company or industry. This invites a lot of opportunity to network and build professional relationships.
The variety of roles and companies you will take on builds a greater diversity of skills and work related experience, further enhancing your CV and potential work prospects.
- You are still entitled to a lot of the benefits experienced by permanent employees
- You may think that when moving to contract work you lose the statutory benefits that are enjoyed by permanent employees, however this isn't the case for umbrella company contractors. When working in this way, because you become an employee of the umbrella company, you are still entitled to statutory benefits such as sick pay and maternity pay, alongside auto enrolment into the work place pension scheme.
- Avoidance of office politics
Most permanent employees, whether they want to or not, find themselves becoming embroiled in office bureaucracy and politics. For many this can become very demoralising.
As a contractor you are, for the most part, able to avoid this. You are judged entirely upon your skills and work output. Your focus is to complete the task you have been brought in to do and not to worry about becoming emotionally involved.
