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Comment by Nursie | Hacker News Reader

Why bother with a third party company registration service? You can do it yourself pretty easily through companies house.

Do companiesmadesimple have any value-add?

While I do share your cynicism about recruiters, I have also got most of my contracts through them. There are bad recruiters (vague job descriptions, never call you back) and there are good ones (We need someone here, you fit the bill, can we arrange a time to talk to my client?).

Learning to swallow your distaste and listen to them as if they were worthwhile human beings is a useful skill. Some (few) of them actually are.

(--edit-- good guide in general! I don't just want to harp on the negatives!)

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A few more comments -

Rate - Daily is good, hourly can also work. My current client will pre-authorise overpayment of a few hours a week if I work them. A little income boost if I want it.

IR35 - The 'own equipment' thing is a guideline only, and I don't think you'll fall foul of IR35 for using their equipment, particularly as many places only allow their equipment to be used on their networks.

There are other reasons to avoid working for one client long-term too. At the moment you sign up for a contract or contract renewal that takes you over the two year mark, you can no longer claim day to day expenses.

I.E. I sign an initial 18 month contract, and at the end sign up for another year. From the18 month point the client office will be considered my 'normal place of work', regardless of IR35, so the company cannot pay for transport or lunch any more.

> Rate - Daily is good, hourly can also work. My current client will pre-authorise overpayment of a few hours a week if I work them. A little income boost if I want it.

How do you manage your hours with a day rate? Is a work day 8 hours, or is it any day you worked for the company more than X hours?

I've been trying to move to logging time and equating 1 day to 8 hours work.

I find it fiddly to bill per day when perhaps I only needed to work 5 hours to complete one job and 3 on another day.

Good to get this stuff sorted out ahead of time I guess.

Last year I was on a no-questions, no deviating day-rate. The consultancy I was working through wanted hourly accounting, I told them no and charged my rate per day or part of a day I worked for them, and based my working practices around 7.5 hour days. I put in the odd extra hour or ten here and there because I liked them and enjoyed the project, and they never quibbled about me clocking off early when the project didn't require a full day's attention. Quid pro quo I guess.

For this current contract the agent demands an account of hours worked and pays extra hours at day-rate/7.5, up until some maximum at which time I get to charge double, but the time has to be authorised by the end-client.

But it sounds like you're doing much smaller chunks of stuff for multiple clients? I tend to dedicate myself to one client at a time and work more or less full time on one project. Serial monogamy one might call it... I'm not an employee because I work on a project basis and then leave with no fuss :) I'm definitely a contractor, are you more of a freelancer?

> But it sounds like you're doing much smaller chunks of stuff for multiple clients? I tend to dedicate myself to one client at a time and work more or less full time on one project. Serial monogamy one might call it... I'm not an employee because I work on a project basis and then leave with no fuss :) I'm definitely a contractor, are you more of a freelancer?

It's mostly one client at the moment, but not full time (10 days a month) and often based around when a new dataset becomes available to analyse. I work in Biotech and not strictly software development, so it's a slightly different model I guess.

It's also partly my fault, sometimes life gets in the way or I run out of steam after 4 or 5 hours staring at a dataset.

For contracting I'd ideally like to have a few clients and move between projects.

I do largely prefer the hourly rate myself. The reason is that it is way too easy to work 'more' but it is very hard to work 'less' when paid daily. It was a problem I had for all the years I was employed, and I hate it..

With the hourly rate, I can just go off at lunchtime if I feel like the weather is good, and plonk in 12h on the following day if I like. And nobody /minds/ because they know I'm on an hourly rate. Also, I have a 'primary' client, so I can work there in the morning, and take on another contract from home and work that in the afternoon for example. I've been doing that a lot lately, and yes some days you end up doing silly hours, but they are all /paid/ hours.

I used to charge (as a freelance) on 'project' and 'phases' and so on, but very often, you always end up working more due to shifting specifications, bugs etc. By sticking to an hourly rate, you remove that constrain, and if you are 'expensive' companies will try not to waste your time -- while I see a lot of 'daylies' being given menial jobs because they are considered 'cheap' and expendables.

> I find it fiddly to bill per day when perhaps I only needed to work 5 hours to complete one job and 3 on another day.

But you're also forgetting that this 3-5 hours has basically made you lose what could have been 4 hours at another client because they've taken up your time in your schedule. This is your per-job overheads.

Your utilisation is your client's problem, not yours. Don't let your rate be tied to your time, make it tied to your skills and your value to the business and force yourself to be worth that value.

Don't let yourself lose out in the name of "being competitive". Bill half the day if you have to leave early and consider it a half day off, but never bill hourly.

Source: just went from billing hourly to daily. I feel so much better now, especially when you realise people are willing to pay if you're worth it.

Professional working day = fine if you client is nice can result in being expected to work stupid hours for no benefit..

IR35 equipment is an utterly irrelevant point. The real factors are:-

Right of Substitution (I can replace myself with Fred and the client can't complain) Mutuality of Obligation which means that the client doesn't need to pay if they have no work for you to do regardless of the length of the contract Where you were last. you can't be a permanent member of staff on Friday and start back in the same desk as a contractor on Monday morning.

Lots of stuff regarding IR35 can be found at http://www.contractoruk.com/ir35/ and http://www.ipse.co.uk as IR35 is why the latter exists...

> Why bother with a third party company registration service?

Well, note the affiliate link...

Companies House charge £15 for setting up a company online. Most accountants include it in their service, and will let you use their address as your office/postal address if you want.

It may be different for developers but if you avoid recruiters, you're probably ignoring about half the job market for contracting.

When I decided I wanted a Ltd I spend an afternoon reading through the regulations on HMRC and Contractor UK and still wasn't really sure what I needed to do. I went with Crunch and they setup everything for me in a couple of days (including flat-rate VAT and PAYE). If I were to do it again I probably would do it myself, but to start with I don't think it's really worth the effort of this is all new to you.

When I first started contracting I used an umbrella company for a few months, I'd recommend people starting out go this route then move to a Ltd once they are sure this is what they want to do.

I mostly went with them because of their privacy package. They do simplify the process a little bit by putting a nice UI on top of this more manual process [1]. I'd rather pay a few extra pounds than risk submitting wrong information thus creating more trouble further down the road. Perhaps, FUD was playing a role too.

[1] - https://www.gov.uk/limited-company-formation/overview

I found it pretty easy when I did it three years ago, it's not hard.

That said, I didn't need to bother, as part of on-boarding with my accountant they would have done it all for me.

I recently did it, took about 10 minutes online I think. I would guess the services make things easier for you by suggesting a default number of shares, and automatically filling in director information etc.

My accountant also would have done it, but I wanted the company in existence quickly so I could get contracts signed.

The UI in the formation companies is often worse and asks exactly the same questions.

The privacy service is a genuine value-add if you don't like putting your home address on the Internet.

You can get service addresses that forward on HRMC mail for 20-30 quid a year.

They do all the annoying paperwork for you at the registration service like the initial transfer of directors capital and appointments and crap like that. It's worth it.

(I've killed 5 limited companies now so I have lots of experience ;-)

IR35 is the only PITA IMHO of doing all this and that's easily sorted by doing the odd phone/laptop repair at the same time and invoicing it.

>> IR35 is the only PITA IMHO of doing all this and that's easily sorted by doing the odd phone/laptop repair at the same time and invoicing it.

Oh, a phone/laptop repair for someone else, and invoicing them for it?

In just under three years I've taken on 5 contracts of varying lengths and billed for a small amount of casual consultancy work on the side too. I'm clearly not acting as an employee, hopefully I'm in the clear :)

No it won't..

IR35 is explicitly contract by contract based... In theory (and in practice) you could be working at 3 places at the same time and 2 of them would be outside IR35 and 1 would be inside it...

There are a lot of old wives tales and myths around IR35 http://www.contractoruk.com/ir35/top_ten_ir35_myths_debunked... shows a few of them. And sorry for posting links to the same two sites but that is where the real information is from people who have operated this way for years...

You're right and I glossed over most of it but the killers are concurrency, substitution and fixed deliverables. With concurrency, if you can prove that during the contracted period you had billable work outside the contract then that goes in your favour if you get nabbed and the contract is borderline. With substitution, the contract should state that you can provide a substitute on demand so you're contracting out services and yourself. The third is fixed deliverables; that's always a killer. Rolling contracts as non distinct labour are how to get shot.

For ref I had a small battle on this front and concurrency won it for me.

TBH get a good solicitor and get them to take a look at the contract paperwork. That's better advice :)

Concurrency was part of the HMRC's Business Entity Tests which were so hilariously inaccurate compared to IR35 actual rules its was funny.

I guess if you had a small battle and that won it that battle wasn't with HMRC but instead with the Cabinet Office or another government department / quango...

/Nursie - companies that provide registration services save time. If you have time, you can diy registration, right. But generally they provide very convenient service. Besides, services like 9-10 Adam Street can also provide you conference rooms, club place etc., in addition to registration. There are many companies that will help you open Ltd in the UK fast, and very few that will help you to close the once opened company.

Disclaimer: recently volunteered to help to shut down UK limited company, I wished I'd used someone else.

I was just looking at the site linked from the howto and couldn't see what they were giving me that using companies house directly didn't, for the simple case of company registration.

I haven't been through shutdown yet, so I'll take your word for it (and everyone else's!) that it's painful...

>I was just looking at the site linked from the howto and couldn't see what they were giving me that using companies house directly didn't

Worse they give you usually less as many formation companies keep the "webfiling auth code" for themselves and you will have to do all Companies House related administrative tasks through them (most likely for a fee).

Retrieving your webfiling code in that case is just hassle you wouldn't have had if you incorporated yourself in the first place.

It literally takes 10 minutes to register a company yourself now, your advice is about 8 years out to date.

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