One of the most frequent conversations I have with jobseekers is around how to go freelancing after 3-5 years in permanent roles. Here are some key points to consider when thinking about making the jump to freelance.
How much should I charge as a freelancer?
There are many influencing factors: length of contract, location, project type, deliverables, and the contract market. The best approach is to review what’s out there and measure your experience against the going rates.
Naturally, you should also talk to your contacts – including a trusted recruiter – and find out what they think is reasonable for your unique background and skill set.
Rates can vary dramatically. For example, in the UX market at the moment, we’re seeing a wide range of rates from £300-500/day, and sometimes higher for specialisms such as financial trading system design expertise.
Are there any regulations I should know about?
You’ll need to think about opting into or out of Conduct Regulations, so here’s a guide you can download to explain more. You should also be aware of the IR35 and AWR regulations, as they affect all freelance workers.
Looking after your accounts
You’ll need to carefully look after your accounts as a freelancer, and we find that most freelancers choose to either work through an umbrella company or set up their own limited company.
Umbrella companies are very handy for a quick setup and are often preferred by individuals who find themselves freelancing at short notice or for a short period of time.
Avoid anything that sounds too good to be true in terms of tax allowance, and check to make sure the company is registered in the UK, as most employers cannot work with offshore umbrella companies.
Setting up a limited company is a very popular option, particularly amongst contractors who are setting out to freelance for a long time. They are slightly more time consuming to set up and run, but generally have more tax benefits than an umbrella company will.
You will need a number of documents to set this up, and it may be a good idea to speak with an accountant before starting.
Is the freelance interview process different?
Interviews will normally have a different feel to a permanent position, and can often be a one stop interview process. We’ve even had the odd hire based on a quick telephone call, or review of a CV and portfolio.
Being able to articulate relevant projects and quickly give a client piece of mind that you’re a safe pair of hands is crucial. There are exceptions to this with highly specialised or senior contracts where interview processes can have a semi-permanent feel with multiple stages.
Hopefully this article has been of help if you’re thinking about going freelance. Please feel free to send us some follow up questions if you’re keen to hear more!