Anyone an IT contractor?

mcast123

mcast123

mcast123

Associate
Joined
8 Feb 2006
Posts
1,322
Worked permy 2nd/3rd line AD/exchange/windows server support/admin for 10 years and after 3 years out of IT I'm going back in. I'm going to try contracting this time.

Agencies are asking for my minimum hourly rate, is this site accurate?? £16.75p/h average is pathetic, I may as well stack shelves at Tesco. I was expecting a minimum of £25p/h.
 
That can't be right, contractor work is generally massively inflated as you have to account for periods of no work. Typically in my line of work (Business analysis/system development) the going rate is daily and it's like £400+ a day in some areas. Sure it can be very specialist but it's not like IT salaries are a pittance, especially at 2nd/3rd line.
 
Remember you have to pay your employer NI and any umbrella/accountant fees out of your hourly rate. These were quite expensive when I was contracting for a year.
 
Sawell said:
That can't be right, contractor work is generally massively inflated as you have to account for periods of no work. Typically in my line of work (Business analysis/system development) the going rate is daily and it's like £400+ a day in some areas. Sure it can be very specialist but it's not like IT salaries are a pittance, especially at 2nd/3rd line.
Click to expand...

I'm outside London this time (I can't take the noise), so I'm thinking £200+ per day or £25 p/h, do I just multiply hourly by 8 for daily?

Trifid said:
Remember you have to pay your employer NI and any umbrella/accountant fees out of your hourly rate. These were quite expensive when I was contracting for a year.
Click to expand...

I knew about company tax and accountant fees not the employer NI :mad:
 
Trifid said:
Remember you have to pay your employer NI and any umbrella/accountant fees out of your hourly rate. These were quite expensive when I was contracting for a year.
Click to expand...

No they're not expensive, as much as £10 a week from Umbrellas like NASA Consulting who I used, they worked out all the contributions, expense returns, basically all the finances were managed by them each week for that £10 fee.

I used them for 2 years while contracting in IT at £15.50 an hour, down south here that seems to be the average rate. Couldn't complain though especially considering I was able to claim back a lot of the cost (40p/mile for the commute, lunches, meals and any equipment you had to purchase to do the job at the present employer.
 
Our contractors get £14.50/hr unless they're particularly well skilled, more experienced ones will get a tad more though. Whenever we're after a contractor though we have the choice of hundreds!
 
Khaaan! said:
No they're not expensive, as much as £10 a week from Umbrellas like NASA Consulting who I used, they worked out all the contributions, expense returns, basically all the finances were managed by them each week for that £10 fee.

I used them for 2 years while contracting in IT at £15.50 an hour, down south here that seems to be the average rate. Couldn't complain though especially considering I was able to claim back a lot of the cost (40p/mile for the commute, lunches, meals and any equipment you had to purchase to do the job at the present employer.
Click to expand...

I used to use Futurelink, but taking a look at NASA Consulting, they seem to offer a much better solutuon for less than half the price.

Thanks for that.
 
From experiance of what I've been paid, and of colleagues, in a non London government agency:

Desktop support - £13-£15 per hour
Server support inlcluding some 'specialist' knowledge of products, eg Exchange, SCCM - £25-£35 per hour

As for day rates, never did a contract that paid daily but for just support work you're looking at approx £200 a day, maybe little higher/little lower.

The problem is in IT the world and his dog can do 2nd/3rd line AD/windows server support/admin, must be the most popular kind of thing in support.

Exchange will help, depending on the level of expertise you bring to the role. However if it's just admin rather than implementation knowledge then it won't count for much.
 
From experiance of what I've been paid, and of colleagues, in a non London government agency:

Desktop support - £13-£15 per hour
Server support inlcluding some 'specialist' knowledge of products, eg Exchange, SCCM - £25-£35 per hour

As for day rates, never did a contract that paid daily but for just support work you're looking at approx £200 a day, maybe little higher/little lower.

The problem is in IT the world and his dog can do 2nd/3rd line AD/windows server support/admin, must be the most popular kind of thing in support.

Exchange will help, depending on the level of expertise you bring to the role. However if it's just admin rather than implementation knowledge then it won't count for much.

£16.75 for that seems perfectly reasonable, and if you think you should have more go get it!

Sawell said:
That can't be right, contractor work is generally massively inflated as you have to account for periods of no work. Typically in my line of work (Business analysis/system development) the going rate is daily and it's like £400+ a day in some areas. Sure it can be very specialist but it's not like IT salaries are a pittance, especially at 2nd/3rd line.
Click to expand...

£400+ a day in support/general IT work is a very good rate and not the norm. That's the kind of thing you get paid for doign big stuff, not general admin and support.

That rate works out to say 28/29k a year which for what it is probably is about right if you think a lot of people do that job permy for 20k.
 
Turn the question around on the agent...

Feed them a line about not wanting to price yourself out of the market, but don't want to sell yourself short and not be taken seriously, afterall they're usually on a percentage, so when you earn more, they earn more. Explain that you understand the market conditions are tough so you're trying to get a feel for what market rates are? Push your luck and ask what sort of range other candidates are being put forward at...

'lowest rate' always sets alarm bells off with me. Does the agent (or rather client) want good or cheap. Everyone wants value, but best value isn't always cheapest...

If Employers NI is new to you, be aware that you'll be required (and well advised from an IR35 perspective) to seek insurance also. I use Caunce O'Hara for this.

Consider PCG Plus membership if you'll be outside IR35, and don't scrimp on the accountant either. There are all sorts of areas where you can save money and get things cheaper, but then we get back to the 'value' aspect.

I'm happy to pay a little more than I could pay elsewhere for the excellent service I get from SJD Accountancy. I don't want to have to chase my accountant for the sake of £20 a month...

Setting up a limited company might be better saved for when you're certain that contracting is for you, but I prefer this to working with an umbrella company. Chasing a third party that doesn't seem to understand that their responsibility is to turn contracts and payments around in double quick time gets tedious quickly.

Technet Plus is worthwhile for the software and licenses you get as well, keeping sharp with the latest kit in a VM environment is worth consideration.

Be prepared to travel (including staying away during the week) if you want more money. Familiarise yourself with the vetting procedure before applying for security cleared roles, but be aware that if you can get sponsorship, then cleared roles usually attract a premium.

Rough breakdown

~£2400pa in PAYE/Employee NI/Employer NI (based on a ~£11k salary)
~£1200pa to the accountant
~£250pa for PCG Plus
~£250pa for Technet Plus
~£300pa for Insurance

The figures above are slightly inflated because a; it's always a good idea to budget for more than things will actually cost for a bit of contingency, and b; because I'm lazy and can't be bothered to go looking for the exact figures.

Either way, budget £4k-£4.5kk pa and remember that you'll have unpaid leave (bank holiday, holiday and sick) and periods out of work to contend with when you're calculating day rates versus salary etc...

The flip side is that the rates should be higher, and IR35 plus the flat rate VAT scheme should bolster your overall earnings if you're good/flexible/lucky...

Good luck... :)
 
Khaaan! said:
No they're not expensive, as much as £10 a week from Umbrellas like NASA Consulting who I used, they worked out all the contributions, expense returns, basically all the finances were managed by them each week for that £10 fee.

I used them for 2 years while contracting in IT at £15.50 an hour, down south here that seems to be the average rate. Couldn't complain though especially considering I was able to claim back a lot of the cost (40p/mile for the commute, lunches, meals and any equipment you had to purchase to do the job at the present employer.
Click to expand...

The one I was directed towards charged £30 a week. :o I was rushed through the process so I didn't have time to research it fully.
 
Thanks for the replies, lots of good info in there.

Kingy great suggestions there.

So it really does sound like £16-17ph is about right for me, I've setup loads of single exchange environments for SMEs, but no multi environments. I could have sworn you used to get £25ph for just server admin stuff, I guess this recession is biting hard.

I can't do permy anymore, 11 hour days + weekends and words like "proactive", "let's touch base" or "low hanging fruit" make my physically sick.
 
Trifid said:
The one I was directed towards charged £30 a week. :o I was rushed through the process so I didn't have time to research it fully.
Click to expand...

That's probably top line tax deductible, but do check. My old umbrella used to charge 90 a month but after tax offset it was more like 20-30 in real cost to me. So check if the figures are pre tax or not.

I would say that's a decent rate unless your In London
 
mattyfez said:
That's probably top line tax deductible, but do check. My old umbrella used to charge 90 a month but after tax offset it was more like 20-30 in real cost to me. So check if the figures are pre tax or not.

I would say that's a decent rate unless your In London
Click to expand...

It came out of my pay before tax was taken IIRC.
 
mcast123 said:
So it really does sound like £16-17ph is about right for me, I've setup loads of single exchange environments for SMEs, but no multi environments. I could have sworn you used to get £25ph for just server admin stuff, I guess this recession is biting hard.

I can't do permy anymore, 11 hour days + weekends and words like "proactive", "let's touch base" or "low hanging fruit" make my physically sick.
Click to expand...

Where to start...

First off, don't let the multi environment stuff put you off. I was exactly the same 6 years ago, and it's never held me back. Avoid design roles, don't lie, but don't be too honest until you get into the role, then be honest and fearless.

If you're getting into contracting because you want to work less, you may well be incredibly successful. Be careful what you wish for.

Contracting isn't about working less, it's about getting paid extra for the extra you do.

People need to understand the difference between IT temp, and IT contractor (I'm looking at you Gideon!). £16-£17ph is IT temp money. An IT contractor is a limited company selling a man's services (:eek:) and as such is able and willing to a; sell themselves, and b; sacrifice and compromise personally to get the job done, and get paid more for doing it well.

If you're working all hours god sends, you have the work ethic to succeed, but you must learn to develop some business nous. If you have a lot of SME experience, sell your customer facing skills, afterall, you're not just another techie, you can talk to grown ups / relate at a non techincal level etc...

Support is often a thankless task. Have you done much in the way of systems installation? Given your SME background I assume this is the case. Sell this as deployment and service delivery rather than rollout work etc. Look at ITIL Foundation / PRINCE 2 Practitioner principles. Get certified where possible, but focus on work experience and take yourself out of your comfort zone (buzzword bingo never hurt anyone... ;))
 
Contracting is what you make it, of you are prepared to work away from home you can make a fair amount of money.

Don't make the mistake of getting too attached to any one role though ;)
 
You must log in or register to reply here.
Back
Top Bottom