Contracting for the 1st time. advice needed on tax/pay

Tombo_G

Hi,

I recently left my full-time (paye) job in a bank and I am now going to start contracting for anther bank via a recruitment consultancy. I have been told that I have to set up an umbrella company or limited company.

I have not had any experience of this before and my recruitment agency are pushing me to sort this out by next week.

I not sure where to begin and what options are available to me and what the pros/cons of each choice are.

I expect to be contracting for a minimum of 3 months but could be a permanent career choice if things all go well. I not completely financially clue-less and have some good basic knowledge of tax and accountancy from my degree (if that makes any difference).

I should be earning above £800 p/w gross.

Any pointers would be greatly appreciated.

Pennywise

www.contractoruk.com is probably the best place to look. They have a long ongoing thread entitled "should I trade as a limited company or umbrella" which answers everything you could ever need to know about which way to go - http://forums.contractoruk.com/accounting-legal/7487-should-i-trade-limited-company-umbrella-composite.html