5 ms·

You can earn north of $200,000 or even $300,000 a year in the London contract market. Given that you apparently don't get resonable time off when earning the b

You can earn north of $200,000 or even $300,000 a year in the London contract market. Given that you apparently don't get resonable time off when earning the big bucks on SV, my Ltd would gross around $300,000 p/a if I billed for all 253 business days and I only work 9-5. Basically, if you're actually good, become a contractor and move into a niche paying the higher rates. Edit: Plus it's not really just about headline rates, it's what you're left with at the end. Let me break that down for you. £700 p/d x 253 x 1.2 (vat) = £212520 - subtract 14.5% flat vat rate = 181704.6 - subtract 8k tax free income = 173704.6 - subtract 20% copr tax = 138963.68 - subtract 32k tax free divs = 106963.68 - subtract 6k expenses (laptop, travel, phone etc) = 10000.00 You now have paid yourself £40,000 to live on (and don't have to pay for travel yourself) and you have £100,000 ($144710) saved in your company to invest, etc. I'd be suprised to see a single male in SF living that lifestyle, but it's not uncommon in London.

Silhouette 11y ago
I'd be suprised to see a single male in SF living that lifestyle, but it's not uncommon in London. £700k/day is not uncommon? For experienced specialists in the right niches, it's certainly possible, but "average developers" aren't going to command that kind of rate even in London.
- ownagefool 11y ago
  Not eveyone will earn at the higher end of the market in SV either but £600 to £700 a day isn't terribly difficult to achieve in London. Basically we're talking about being a semi good and modern Java, Node or Python developer. Alternativly a system administrator who's not afraid of automation. You'll probably need to work in Government or Finance, but like I said, it's not uncommon.
  - Silhouette 11y ago
    You'll probably need to work in Government or Finance That's the kicker, and what I meant by "the right niches" before. I know plenty of people doing contract software work in and around London who aren't getting close to that, and surely would be if the general market was that high. These are pretty well qualified (often PhD) and experienced (10+ years) people who know what they're doing and have decent track records, they just don't enjoy working in intense environments like trading. I'm curious about where you think the Government gigs at that rate are found, if all they need is being semi-good with one of the popular languages. I can think of quite a few people who'd be interested in that kind of opportunity, but if any of my close network are doing it right now then they've not mentioned it.
    - ownagefool 11y ago
      That'd be the kicker if it was extremely difficult to get into either Government or Finance but it's not. Either way, places that'll pay this in Government are The Home Office, DWP, DVLA, MOJ & GDS. Pretty much every arm of central Government pays decent rates. But rather than me just talk crap, why don't you just look:- https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197FA79410EA1 https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197F... https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197FA79410EA1 https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197F... https://www.jobserve.com/gb/en/JobSearch.aspx?shid=6E57F8DA8E00AC2897 https://www.jobserve.com/gb/en/JobSearch.aspx?shid=6E57F8DA8...
      - Silhouette 11y ago
        Sorry, I'm not sure what you meant to link to there, but I suspect what you actually linked to wasn't it. In any case, based on people in my network, it doesn't appear to be guaranteed that people working for civil service departments such as those you mentioned will routinely attract the kind of rate you're talking about even at high levels.
        ownagefool 11y ago
        The link seems to lost the settings, but either way, jobserve, contracts, select by rate and search the programming languages. Anyways those rates aren't guaranteed but the money is out there. However, you won't get them by not asking for them. Why would you? :)
        Silhouette 11y ago
        I won't get those rates anyway, as my career has taken a slightly more entrepreneurial path recently. :-) However, I'm half interested on behalf of various friends and former colleagues who are still 100% contract/freelance, and half interested from the point of view of not giving an overly optimistic view to anyone reading this who isn't familiar with the contracting market. As it happens, I did check several sites including the one you mentioned when I first posted, and based on that it looks like it's still fair to say that £700+/day rates are achievable particularly in London and in the right niches, but they aren't (yet?) the norm even for quite good developers.
- nvarsj 11y ago
  Just wanted to chime in that 700/day is not typical, esp for a 6 month+ contract. Typically you'll see 500-600 for Java/Ruby/Python, and that's for experienced people (5+ years). Finance gigs can pay 550-650 usually over the long term. Boutique / specialised consultancies can charge 700-1000+ a day but it's usually short contracts and they take a big cut off of the contractors rate. I know of "architect" roles that have paid into the 800s but it is atypical. Certainly not as common as new grads making over 200k USD in SV bigcos.
ldnthrowaway80 11y ago
How do you get the money out of your limited company without paying the higher rate? The only option is dissolving the company and claiming entrepreneurs relief, but then you are back to FTE or umbrella (or phoenix). Also my understanding of investing company profits was that you are taxed twice on profits, and it could change your company status if you want to claim ER in future.
- ownagefool 11y ago
  > How do you get the money out of your limited company without paying the higher rate? You don't, that's your retirement/rainy day fund. > The only option is dissolving the company and claiming entrepreneurs relief, but then you are back to FTE or umbrella (or phoenix). You'd only really do this if you don't intend on contracting anymore. Hopefully by that time it's enough to not work anymore. Alternativly, just keep paying yourself a small salary and dividens. > Also my understanding of investing company profits was that you are taxed twice on profits, and it could change your company status if you want to claim ER in future. You won't get taxed twice but if you investing starts bringing in a lot more than contracting then you company could be reclassified. That said, you can also roll up an investment entity and pay that tax there. You'd be paying 28% on profits but you'd have more money in the pot making money. Obviously you can also pay yourself more and pay the high rates of tax, or you can put it into a pension, a SIPP is arguably the best long term option.
gambiting 11y ago
Question - why ltd and not self employed?
- ownagefool 11y ago
  You can't really get a contract via an intermediary (an agency) as self-employed, as they're liable if you don't pay tax. Having a Ltd also allows you to defer paying higher rates of taxes, avoid paying NIC (both employers and employees), and I'd say it's simpler being two entities.

Silhouette 11y ago

I'd be suprised to see a single male in SF living that lifestyle, but it's not uncommon in London. £700k/day is not uncommon? For experienced specialists in the right niches, it's certainly possible, but "average developers" aren't going to command that kind of rate even in London.

ownagefool 11y ago
Not eveyone will earn at the higher end of the market in SV either but £600 to £700 a day isn't terribly difficult to achieve in London. Basically we're talking about being a semi good and modern Java, Node or Python developer. Alternativly a system administrator who's not afraid of automation. You'll probably need to work in Government or Finance, but like I said, it's not uncommon.
- Silhouette 11y ago
  You'll probably need to work in Government or Finance That's the kicker, and what I meant by "the right niches" before. I know plenty of people doing contract software work in and around London who aren't getting close to that, and surely would be if the general market was that high. These are pretty well qualified (often PhD) and experienced (10+ years) people who know what they're doing and have decent track records, they just don't enjoy working in intense environments like trading. I'm curious about where you think the Government gigs at that rate are found, if all they need is being semi-good with one of the popular languages. I can think of quite a few people who'd be interested in that kind of opportunity, but if any of my close network are doing it right now then they've not mentioned it.
  - ownagefool 11y ago
    That'd be the kicker if it was extremely difficult to get into either Government or Finance but it's not. Either way, places that'll pay this in Government are The Home Office, DWP, DVLA, MOJ & GDS. Pretty much every arm of central Government pays decent rates. But rather than me just talk crap, why don't you just look:- https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197FA79410EA1 https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197F... https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197FA79410EA1 https://www.jobserve.com/gb/en/JobSearch.aspx?shid=E3A30197F... https://www.jobserve.com/gb/en/JobSearch.aspx?shid=6E57F8DA8E00AC2897 https://www.jobserve.com/gb/en/JobSearch.aspx?shid=6E57F8DA8...
    - Silhouette 11y ago
      Sorry, I'm not sure what you meant to link to there, but I suspect what you actually linked to wasn't it. In any case, based on people in my network, it doesn't appear to be guaranteed that people working for civil service departments such as those you mentioned will routinely attract the kind of rate you're talking about even at high levels.
      - ownagefool 11y ago
        The link seems to lost the settings, but either way, jobserve, contracts, select by rate and search the programming languages. Anyways those rates aren't guaranteed but the money is out there. However, you won't get them by not asking for them. Why would you? :)
        Silhouette 11y ago
        I won't get those rates anyway, as my career has taken a slightly more entrepreneurial path recently. :-) However, I'm half interested on behalf of various friends and former colleagues who are still 100% contract/freelance, and half interested from the point of view of not giving an overly optimistic view to anyone reading this who isn't familiar with the contracting market. As it happens, I did check several sites including the one you mentioned when I first posted, and based on that it looks like it's still fair to say that £700+/day rates are achievable particularly in London and in the right niches, but they aren't (yet?) the norm even for quite good developers.
nvarsj 11y ago
Just wanted to chime in that 700/day is not typical, esp for a 6 month+ contract. Typically you'll see 500-600 for Java/Ruby/Python, and that's for experienced people (5+ years). Finance gigs can pay 550-650 usually over the long term. Boutique / specialised consultancies can charge 700-1000+ a day but it's usually short contracts and they take a big cut off of the contractors rate. I know of "architect" roles that have paid into the 800s but it is atypical. Certainly not as common as new grads making over 200k USD in SV bigcos.

ldnthrowaway80 11y ago

How do you get the money out of your limited company without paying the higher rate? The only option is dissolving the company and claiming entrepreneurs relief, but then you are back to FTE or umbrella (or phoenix). Also my understanding of investing company profits was that you are taxed twice on profits, and it could change your company status if you want to claim ER in future.

ownagefool 11y ago
> How do you get the money out of your limited company without paying the higher rate? You don't, that's your retirement/rainy day fund. > The only option is dissolving the company and claiming entrepreneurs relief, but then you are back to FTE or umbrella (or phoenix). You'd only really do this if you don't intend on contracting anymore. Hopefully by that time it's enough to not work anymore. Alternativly, just keep paying yourself a small salary and dividens. > Also my understanding of investing company profits was that you are taxed twice on profits, and it could change your company status if you want to claim ER in future. You won't get taxed twice but if you investing starts bringing in a lot more than contracting then you company could be reclassified. That said, you can also roll up an investment entity and pay that tax there. You'd be paying 28% on profits but you'd have more money in the pot making money. Obviously you can also pay yourself more and pay the high rates of tax, or you can put it into a pension, a SIPP is arguably the best long term option.

gambiting 11y ago

Question - why ltd and not self employed?

ownagefool 11y ago
You can't really get a contract via an intermediary (an agency) as self-employed, as they're liable if you don't pay tax. Having a Ltd also allows you to defer paying higher rates of taxes, avoid paying NIC (both employers and employees), and I'd say it's simpler being two entities.