The 10 commandments of contracting

When first starting out in contracting it can be a daunting period.

With lots of advice telling you what you should be doing and how to prepare yourself, no one really highlights the things that you shouldn’t do.

This blog looks at some of the experiences contractors have had when first starting out, to give you a good idea of what to look out for in the first few months of contracting.

Commandment number 1: Don’t ignore professional advice

If you’re paying for professional advice that ensures your business trades in a compliant way, don’t ignore it! Just as you’re a master of your trade, your professional advisers know their stuff, so let them take the reigns when it comes to business compliancy. There’s a reason you appointed them after all! If you don’t already have a contractor accountant, it’s a good idea to appoint one. The efficiencies you can achieve far outweigh the costs.

Commandment number 2: Don’t put off getting your LinkedIn or business website up to scratch

Your potential clients can find out whatever they like about you from the touch of a button. So why not ensure they see the best of you? Sharpen up your LinkedIn profile as if Lord Sugar was hunting you down, and make sure your business website is showing off your best and latest work. There’s lots of advice out there on how you can get your website looking like you mean business.

Commandment number 3: Don’t start a contract, without the contract!

If you are yet to receive a signed contract or written agreement from your new client, then do not start work. Ensure that your client is aware of your terms of employment, and that everything has been agreed by both parties in writing before starting work. This can include the duration, work required, location, rates, and any other terms. Also make sure your contract has had an IR35 review by a professional adviser. Your appointed contractor accountancy should be able to do this for you, but beware! Not all accountancies perform contract risk assessments as part of your monthly fee.

Commandment number 4: Don’t lose sight of why you chose contracting

You started contracting for a reason, be it for professional freedom, an increase in opportunities, a better work / life balance or greater financial rewards.

Commandment number 5: Don’t cause yourself avoidable stress

Sometimes letting go of 100% control can be hard to do, but if it means alleviating some of the daily stresses you entail then do it. Have a daily plan, create a routine that suits you, and above all make contracting work for you.

Commandment number 6: Don’t let an opportunity pass you by

If you’ve been offered a fantastic contract from a new client whilst in the midst of completing your current one, don’t turn it down straight away. Talk through their time scales and deliverability on the new contract to see if you can negotiate a new start date. Remember, don’t burn your bridges with a potential client just because you’re busy, show them your enthusiasm and it may just work in your favour.

Similarly don’t leave it too late to start looking for your next contract. Make sure you know how to ensure you’ve got a stream of clients knocking on your door.

Commandment number 7: Don’t throw away any receipts you want to claim for!

Always retain receipts for all business expenses as it’s the best evidence of its genuine nature. Where you don’t have a receipt, and HMRC will acknowledge they are not always available, ensure that you retain a record of the nature and reason for the expense, what was purchased and from whom.

Commandment number 8: Don’t let contracting take over your life

Having an influx of contracts can be a fantastic thing, especially when you’re doing what you love. Make sure you take a break and spend time with family and friends. A short period between contracts is not a bad thing if you’re recharging your batteries.

Commandment number 9: Don’t underestimate the importance of business insurance

It’s very important to protect your assets and obtain adequate insurance when contracting. For almost all contractor and freelance professionals a requirement to be insured forms part of your contracts with clients, and it’s essential to be protected from the unexpected. Shop around to find a supplier that suits your individual needs best. 

Commandment number 10: Don’t leave everything to the last minute, or be afraid to ask questions

Leaving your accounts to the very last minute will only cause you stress, and probably at the worst possible time! Make sure you keep on top of them by investing time each month to keep everything in order.

Asking questions is the key to stress free contractor accountancy, so if you have a query about anything make sure you seek the advice of a professional. Also there’s plenty of help out there to assist in making your life easier when contracting, so take a look at some of the tips available to you.

Finally - enjoy contracting!

There’s no fool-proof plan for the ultimate contractor success, but with the right determination and support you can achieve your goals and avoid the pitfalls that can halt you contracting. Enlist the services of a contractor accountant today to help you make the first step into your contracting career.