Tips for first-time contractors

Naseem Touhami


There are many reasons why you might be considering exploring contract opportunities right now, but whatever your circumstances, leaving a permanent role to become a first-time contractor can be very daunting for most. 

If you’re considering becoming a first-time contractor, our Senior Key Accounts Consultant, Naseem Touhami, listed his top tips for contracting.  

Research your market

Naseem: “Before you take the plunge, you have to do your market research. Where do your skills sit within the market? What demand is there for contractors with your skillset? Do you know what the market rate is for a contractor with your skills? What relevant contracts/projects are out there right now?”

Know your worth

Naseem: “Whilst you should do you research on market rates, be prepared to accept a lower rate for your first project or 2 to prove yourself – your skillset might match up, but experienced contractors have a proven track record and client portfolio behind them to justify their rates. Get the first one or 2 under your belt to prove yourself and your rate will increase accordingly.

First-time contractors should consider accepting a slightly lower day rate at first, but also equally importantly, don’t forget about your reputation. Whilst you may be tempted by a higher rate of pay, if you leave contracts too early or jump for money, you will struggle in the long term."

Don’t be afraid to take risks

Naseem: “If your circumstances allow you to take a calculated risk and the opportunity presents itself, then you should take it! You can always go back to a permanent job if things don’t work out or if you find that contracting isn’t the right option for you. If it feels right, go for it!”

Research Umbrella vs. Limited Companies

Naseem: “Setting up a Limited Company for the first time can seem daunting, but don’t let that put you off! You don’t have to commit to a Limited Company straight away, you can always use an Umbrella Company first and form a Ltd Company retrospectively and mid-contract if you wish.

A Limited Company is a lot easier to set up than it sounds! Unless you’re on a low rate or a really short contract, I would recommend the LTD route, but you can also use Umbrella Companies. They’re also useful for first-timers who are just testing the water and don’t want to commit.”

Research IR35

Naseem: “You might have heard a lot about IR35 in the news recently, but make sure you research and fully understand what IR35 is and how it affects you. The legislation change may have been postponed, but the rules still apply, so make sure you know where you stand.”

Connect with contract recruiters

If you’re considering contracting for the first time, get in touch with a recruiter who can offer industry insights and allow you to get a better feel for the market. At TEC Partners, we have experienced contract recruiters who can offer invaluable advice to first-time contractors, so if you’re looking for a bit of guidance, contact us today.

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