Freelance in the construction industry

[oph]

All,

I've been PAYE in the construction industry for a few years.

I'm jumping ship and freelancing.

Am I correct in thinking:
300 a day multiplied x 5 equals 1500 a week, 4 weeks a month ( yes.....roughly! I know about bank holidays) will be 6k?

Then 6k minus 20% deducted by the people sub to will leave me 4800 a month approx?

Do I need to pay any NICO?

Anything I've not considered?

 

[Adam93]

You will complete a tax return every year. Your income tax and national insurance (class 4 & class 2) will be calculated then.

Any CIS that has been deducted in the year is essentially used to offset against tax bill. You may get a refund of tax or you may have some additional tax to pay.

You should probably engage an accountant if you are unsure. The cost of a CIS tax return will be in the region of £200-£300.

 

[Newchodge]

All,

I've been PAYE in the construction industry for a few years.

I'm jumping ship and freelancing.

Am I correct in thinking:
300 a day multiplied x 5 equals 1500 a week, 4 weeks a month ( yes.....roughly! I know about bank holidays) will be 6k?

Then 6k minus 20% deducted by the people sub to will leave me 4800 a month approx?

Do I need to pay any NICO?

Anything I've not considered?

Expenses
Illness
Transport
Record keeping
Slow payers
Non-payers
Correcting mistakes
Weather
Job inflation (Client expecting more than you pay for)

IR35

 

[NicoJ]

You seem to be asking about the financial aspects of this which have been answered by the above posters.

Another thing to consider is liability. When you are PAYE usually the worst thing that can happen if you make a mistake is that you are sacked. When you are self employed (or contracting through a company) you can be sued. Make sure you're adequately insured.

The amounts quoted indicate a skilled profession but you are assuming CIS. Some professions within the construction industry fall outside the scope of CIS so you may have no deductions at all. If that's the case you need to be saving for the tax bill at the end of the year.

IR35 applies if you are operating as a limited company. In my experience contractors refused to pay sole traders so you had to be agency or ltd company (if you weren't on the books). I'm not in the industry anymore so I'm not sure if that's changed now that the new legislation is imminent.