Common law partnership
Partnerships can work well if you are one of several people coming together to provide a range of services to all manner of clients for short term projects. This set up gives you more flexibility than either a limited company or a corporate partnership. However, it’s not a set up that fits easily into the traditional contracting marketplace and, as with corporate partnerships, recruitment agencies have similar concerns over employment risk, which means they’re not always keen to give you a contract and you may have to find all your work yourself.
Good choice if:
- You want to work with other people, offering a range of services to clients
- You’ve decided to commit to contracting for the long term
- You’re happy to take on the extra responsibility
- You don’t mind budgeting for your tax bill, which may be paid in one lump sum
- You’re happy to manage your own finances
Not so good if:
- You work alone and have no partners
- You plan to get some or all of your contracts through a recruitment agency
- You don’t want any hassle or responsibility at all
- You can’t get your head around the basic principles of tax, IR35, National Insurance contributions and so on
- You want to pay tax as you earn (PAYE), instead of being landed with one big tax bill
- You earn below £35,000 a year
