Working as a contractor while also being a mum

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Category: Parenting Tips

Being a mother and working as a contractor is like having two full-time jobs. It involves working to ensure the family’s needs are catered for while retaining enough energy to do the other contracting work.

Contracting provides well-skilled mums with ideal opportunities to do interesting work with the utmost flexibility regarding working hours and to receive decent pay. Doing contract work is a good choice for many mothers because it ensures a good work/family balance. If as a mother you still feel the need to get out and work to help with the household income, and you have the necessary skills and experience contracting is a good option. Some retraining might be required but contracting work is ideal if you want to return to employment after having had a child.

Contracting jobs can generally be found in most disciplines including IT, statistics, science and engineering. It is also possible to work as a contractor in the service industries such as human resources, marketing and management.

What does contracting mean?

A contractor is a highly-skilled and flexible individual who works for specific clients, often on a full-time basis on a particular project until it is completed. Some contractors form a limited company or work in a partnership, while others prefer to use an umbrella company to handle most of the administration work, including taxation, invoicing, etc.

Working as a contractor

If you choose to work as a contractor you can operate as a sole trader, there is no legal obligation to form a company or a legal partnership. A skilled sole trader is in a good position when it comes to securing work, particularly if he or she is using an umbrella company. That is because agencies and clients are in fear of having a legal liability if a sole trader they are employing that is looking after his or her own affairs fails to pay the required taxes or does not comply with other legal requirements.

How to earn well and save on your outgoings

As a contractor, you will benefit from tax-efficient ways of earning money. First and foremost, the contracting fees paid to limited companies are subject to a corporation tax on profits of 20%. As a contractor you can pay yourself a good salary which, if you prefer, need not be large enough to enter a high tax band. Any business expenses that you incur can be set off against your tax bill, which helps in further reducing the tax payable at the end of the year.

If you choose to use an umbrella company and you are paid through an umbrella PAYE scheme, the company will help with offsetting your expenses against the amount of tax you will pay. That will definitely place you in a better tax position than a full-time employee enjoys.

In general, contracting is becoming a very popular way of working for women, as it offers a variety of financial and lifestyle benefits. According to recent research conducted in the United Kingdom, more than 40% of freelancers are women, and around 300,000 of those women are mothers. That indicates just how significant contracting has become to busy mums.