Many people consider working for themselves at one stage or another in their career. Only a tiny fraction of those people ever actually make that step.

Fortunately for you the computer industry is one of the few industries ideally suited to people with competent skills who want to provide their expertise and services on a contract basis.

The major attractions of contract work are flexibility, diversity, independence and money. The prospect of controlling your own destiny is one which convinces many people that the inherent risks are worth taking.

But there are risks and it would be foolish to underestimate them. This brochure is written and designed to introduce you to the pleasures and pitfalls of self employment.


As your own employer you pay your own wages and decide the course of your own future. In other industries you might be called ‘freelance’ or ‘self employed’. These are other terms for ‘contracting’.

If you’re currently working for a major company – or even a fairly small one – you will know that there are busy periods and slack periods. Many companies are also increasingly rolling out IT-driven projects requiring large numbers of highly qualified and experienced IT contractors but on a temporary basis. Likewise, during the busy periods the company often decide to bring in extra help and experience from outside and so turn to contract staff.

Fortunately the computer industry has many more busy periods than slack periods and the busy periods can last for years rather than months. You may be hired because a company needs to buy-in a specific skill or because it does not have a large enough in-house team to deliver its product or service on time.

As a contractor you will be advised as to the length of contact and remuneration for the assignment. If it is a long contract, say twelve months or more then we would normally expect to incorporate review days to remedy the loss of earning power in real terms against inflation.


If you are interested in working for a variety of clients and in being your own boss you may want to consider setting up a limited company through which to supply your services.

The initial set-up costs are relatively small; there are tax advantages; the agencies to whom you are contracting will deal with the limited company rather than you personally on a company-to-company basis and, should business take a dive, you will not personally be liable for any company losses.

Having said how easy it all is, let us add a couple of cautionary points.

Don’t set up your own business without fully thinking through the potential problems and pitfalls

Don’t make any initial moves without talking to consultants and advisers, particularly a good accountant


First and foremost, contracting means independence. You have only yourself to answer to and only yourself to work for. In theory this means that you can work where you like, when you like. In practice, of course, the position is not as simple, as for most people, continuity of work is essential.

Secondly, there are undoubtedly financial advantages in the rate that you receive and the salary that you choose to pay yourself. There may also be tax advantages. You should consult a reputable firm of accountants to find out more about the possible tax benefits. Don’t be fooled into thinking that contracting is a simple way to earn a quick buck. Tales of doubling your salary overnight are, for the most part, exaggerated.

Because you are trading as a company there will be a number of expenses which are allowable against company profit, such as running a car, telephone bills and some hotel bills. Your accountant will be able to provide a full list of what is acceptable to the taxman and what is not.

A third very real advantage is that you are broadening your own experience in the computer industry. By working for a number of different companies on a number of different projects you are boosting your worth in the market and storing up knowledge for the future.

The variety of work which can be offered to IT contractors is a major factor in career satisfaction.


Of course, the basic truth about contracting is that, when you are not working, you are not being paid. No matter what anybody tells you, and however carefully you do your research, the fact is there may, particularly in a less healthy economic climate, be times when you have no alternative but to accept a contract which is neither technically stimulating nor close to home.

Inevitably running your own company will involve a certain amount of paperwork and, while your advisers can look after the technicalities, it is essential that you keep track of your own costs and income.

Built into that paperwork must be a certain number of personal safeguards, such as provision for insurance and pension scheme. In the excitement of setting out on your own, these may be furthest from your mind but they should never be forgotten; particularly in view of the fact that, should you fall ill, you will not be earning any money.

As a supplier and employer of a professional contractor, the limited company you set up will be required by law to have employer’s liability and public liability insurance. Most companies and agencies will also require the company to have adequate professional indemnity insurance.


First and foremost, you need to be prepared to take the risk of going out alone. An important prerequisite to that must be that you have the right skills and experience and that as such you are confident of getting work.

Of course, it will help if you have a fairly wide range of experience already so that you can undertake a number of different tasks. You need to be mobile and you will need to be flexible with an ability to learn fast.

On top of that, you’ll need expert help and advice from friends and professional advisers.


There are industry accepted rates for most types and levels of assignment and we can advise you on those. In the long run though, you can charge as much as you can reasonably expect to get.


Probably a lot less than you think. The major expense is likely to be a car, but since most people already have one, the only extra cost will be to make sure that it is roadworthy and reliable.

Forming a limited company is not expensive, and can if the trading name is not important be purchased “off the shelf”, tailor made to suite the terms and conditions of the computer industry.

You don’t need an office but you do need a telephone, and some space at home which you can use for administrative purposes.


Most people hate paperwork and, if you are not very good at organisation, then it is possible to hand a lot of the paperwork over to experts and advisers who will help you. Of course they will also charge you, but it may be worth it in the long run.

Otherwise, paperwork is a chore that is best done at regular intervals and then filed away for future reference. As a rule of thumb, keep everything in case the taxman wants to see it.


Despite all the assurances you will be given, this is a major step to be taking on your own. TLP has 23 years’ experience of placing contractors in the IT industry. TLP has very well developed and efficient payment systems and financial stability, a comforting thought when selecting an agency.

But starting is only part of the battle. Once you are working it is important that you keep your eye on the market, know where the good jobs are and keep selling your services at the right price. We will help match your skills to assignment requirements issued by a huge range of companies, both in the UK and in mainland Europe.

If you’re interested, give us a ring. We can talk over the problem, and your doubts, on an informal basis. We’re here to help you help yourself.

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