A Guide to IT Contractor Jobs

A Guide to IT Contractor Jobs

Being an IT contractor is very different from being employed. There are more risks, but there are also a great many advantages.

You are a contractor if you work for somebody else for a fixed period under a fixed contract to help them complete a project. You will effectively be selling your skills and time, and will usually be paid by the hour - although contracts with a fixed price to complete a fixed project are also possible.

The IT industry particularly, has a high proportion of contractors, relevant to the total IT workforce. 2005 and 2006 saw demand for contractors jump again, as confidence in the IT sector grew at its highest level since the dot.com boom. Also due to the IT skill shortages in the UK, highly qualified IT contractors will often demand a high premium. Where as IT contractor Jobs used to be something many workers fell into due to necessity, it is often now a preference of many.

The benefits of being an IT contractor are as follows:

  • More money – basic rates (excluding benefits) are usually higher than that of permanent staff
  • Freedom – Contractors have greater flexibility and can take longer time off
  • Variety and experience – Contracting often gives a greater variety of experience in different sectors and areas that otherwise would not have been possible
  • International workers  – IT contractor jobs are often suitable for international workers, looking for jobs in the UK, who have the right skills but do not want to commit long-term.
  • Tax benefits – Contractors who take professional advice can also greatly reduce the amount of tax they pay.

However there are also some disadvantages – primarily no real job security, no individual long term commitment and thus uncertainty.  Additionally often contractors may not have access to the company benefits that permanent employees are offered e.g. bonuses, company cars etc

A large number of IT contractor jobs are likely to be required though for a long time yet and are still the preferred route for many large companies emabarking on significant long-term IT projects.

Confidence amongst contractors remains high, with a recent survey indicating that many are expecting premium pay rises of 10%. Some of the current hottest IT skills for IT contractor Jobs include: Java J2EE, VB.Net, C#, LAMP Technologies and Data-warehousing.

If you have the right experience and skills and personal attributes – then there are many exciting and worthwhile job opportunities currently available. For all the latest job opportunities and a comprehensive list of vacancies, search for all the latest IT jobs.

Do you want to look for IT contractor jobs?

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Furthermore, we hope the following information below will be of use to you:

ContractorUK Guide to Contracting

Comprehensive first timers guide to Contracting. Click here to view (PDF)

Financially, you will need to fully understand how you can maximise your take home pay, thus reducing the amount of tax that you pay as a Contractor.  There are primarily two options for your income and tax management:

Setting up a Limited Company 

The majority of IT contractors work through their own limited company, where you become a director and shareholder, as this is the most tax efficient way of working and has a number of advantages. For example you can claim back a wider range of expenses and you can also access a VAT scheme known as the flat rate scheme, which allows you keep some of the VAT you receive.

Please click here to read a step-by-step guide to setting up your own limited company from ContractorUK.

Working through an Umbrella Company

An alternative is working through an umbrella company that manages your income on your behalf.  Pease click here to download a guide on using an umbrella company from Contractor Umbrella.