Permanent consultancy vs contract?

[413x]

I have managed to land a contract (Inside IR35 unfortunately) interview for a 6 month FTC. Alongside an expected offer for a permanent consultancy position.

I've been tempted for a while to go for contract work. But so far have only had interviews for perm positions. I understand completely this is only an interview and no indication that I'll even get it. Unfortunately I will likely have to commit or reject the perm offer before outcome of the contract role


I expect the consultantcy position to be offered at 45-47k. 5pc matched pension and 10pc bonus.
I expect the inside IR35 to be 400 a day 5 days a week.


Obviously the contract job is more lucrative. But it obviously comes with that uncertainty.

Let's say I get it. This would be my first real opportunity at Contracting.


Is the Contract role as good as it sounds? Or am I looking at it through rose tinted glasses?


If I've worked it out correctly I could work. 8 months of the year with contracts like this and get about same as 12 in this perm work.




Considerations
-I know lack of pension, sick pay, holiday etc is a negative
-I know the impact on mortgages (mines fixed for 5 more years)
-I know it can be difficult between contracts. This is probably the area in most concerned about.

Am I likely to be out of work for 1 month? 6 months? Am I lucky to get this opportunity less than a month after redundancy? And am I over confident that I can make this contracting work? I get this is probably a "no one knows". Just assessing realistic expectations

 

[413x]

(400x21) x 6 = £50,400 pre tax for 6 months

vs.

£45-47k pre tax for 12 months
£5k bonus
I don't know the UK situation on contractor tax these days and the best way to optimize (and what the % would work out as) but you can of course contribute yourself to pensions.


If you didn't get another contract you could, like now, apply for a perm role?

I'm no doubt biased because I contracted for 11 years!

I know. I'm very very drawn to the contract side.
For sure the money is a massive benefit.

Tax inside IR35 (vs outside) is high. (taxed like an employee). But it's still very lucrative in comparison.

And yes I guess there's no reason why not. I have no idea how easy/hard it is to transition between them.


For a bit of background I've had 3 jobs in 4 years so I feel like I'm almost contracting anyway. I tend to get bored after 9 months or so I've found. Which is why I'm considering contracting as something that might work even better for me than perm


And yes. I'm behind in pension too so I planned to heavily pay into that. Maybe less so at start to building a "savings buffer" for out of work time

 

[413x]

It's a tough call. I moved from permanent to contract (Ltd Co) and have enjoyed it thoroughly. I have had quiet spells but as you have pointed out, the money earned contract allows for some quiet periods before the permanent role becomes the "better" option.

The majority of permanent staff that I talked to about going contract said they were scared about the uncertainty of contract and they had kids, mortgage whatever. That didn't sit well with me since every company I have worked for as staff has gone through multiple redundancy periods. I didn't see permanent as a "sure thing" compared to contract with all these redundancies happening, so it made going contract easier.

I know why you have asked the question about how long you're likely to be out of work but I'm sure you already know it's impossible to answer. My experience of 4-5 years of contracting is that overall the earnings have been much more than permanent, despite quiet spells.

Don't count on the contract having a 6 month deadline. I have had a 3 month contract go 8 months and a 6 month contract go for 2 years. What is your feel for the industry? How many other contractors or potential clients do you know? Are you proactive and prepared to hunt down contracts and network?

Yeah I know first hand that permanent work. Is hardly secure.

This job I have been made redundant under 2 years due to cost cutting.
Last job company got bought out. So I left.
So really I don't see the uncertainty as an issue. I'm not concerned now for example being made redundant as interviews are coming in. I'm more concerned with regretting my next move. Ie taking the more traditional, perm role, regretting it, wishing I had focused on contract.

It is a hard call and I don't have a network right now. This opportunity was found by a recruiter for me.
I'd say this is the biggest issue. I've been told that your personal network is where most opportunities come from and mine is, let's say, tiny!

 

[413x]

In my experience I would agree with what you have been told. Most of my work comes from my own network. I have, however, built most of that network whilst contracting.

Things change all the time. Look how crazy the last few years have been. That makes the choice easier for me - I pick short term contracts over permanent work all the time.

Picture yourself in 3 months time, in two separate situations - one permanent, the other contract. In which situation do you most regret not picking the other option?

If I got both offers on table at same time? I'd go for the contracting one. Just to try it.

Problem is having been made redundant I don't know if this is a rare opportunity (being my first contract interview) and by waiting I could essentially miss a decent perm opportunity. (I'd go for this perm if I was sure I wanted perm)

Its a difficult decision. Heart says contract.only live once. Head says, you need a job, next opportunity might be the best one

 

[413x]

I learned more as a contractor then i did as a permie as i get to switch to different kinds of projects and teams and always learn something new vs staying in a dead end same project perm role

This is why I went for it

 

[413x]

I'd still take a contract if I had had the option.
From when I was looking at contract day rates even inside IR35 the day rate was significantly better than great perm roles.
Like for like.

 

[413x]

Yup, it's great. We can also book 40h a year to charitable work.

That's insane. Main reason I wanted contract was to have more time off. By that I mean earning significantly more, so can have more time off. And even after that still be (probably) significantly better off