How Would You Like To Increase Your Take-home Pay in 2022?Posted Wednesday, December 22, 2021
by Jennifer Doyle, Solutions Team Manager at Contracting PLUS
Contracting has become a popular career choice. Moving to a Contracting role not only allows you to have more control over your career, upskill and choose how and when you work, but there are also many financial benefits to be had!
Our solutions team are here to show you how you can earn more as a Professional Contractor while remaining fully compliant.
Higher Rates of Pay
As a Professional Contractor, you can expect your daily rate of pay to be significantly higher than that received as an employee with an equivalent role.
You are typically paid only for the days and hours that you work. In Ireland, the total working days for a PAYE employee is generally 232 days annually.
This is calculated by subtracting weekends: 365 minus weekends = 261 days. Then holidays: 261 minus 20 = 241. Then bank holidays: 241 minus 9 = 232 working days.
So, your daily or hourly rate of pay is increased to reflect that you do not have to be paid for holidays or bank holidays. But not to worry, when comparing your potential Contracting income to your current salary, you should account for a premium of 20% on top of your current salary to make up for this.
Therefore, your gross invoice is already a higher amount before calculating any tax relief or tax deductions that will apply.
You can use our Take-Home Pay Calculator to compare your estimated earnings as a Professional Contractor versus your current salary. For a more accurate estimation, give us a call at 01 6110707 and we would be happy to discuss your potential earnings with you.
Claim Business Expenses
As a Contractor, you can claim business expenses every month. Tax relief is applied to allowable expenses, which gives you another opportunity to maximise your retained income.
The most common expenses include home office equipment, mobile and internet costs, any tools or equipment needed for your role, training and up-skilling costs and relocation costs if you plan to move for a new role. Check out our page on expenses for more information.
It’s important that you work with a provider who will give you the best proactive and personalised advice on allowable business expenses and how you can offset these. At Contracting PLUS, your Dedicated Account Manager will ensure you’re well supported in this area!
Boost Your Pension Savings
As the director of an Umbrella Company or of your own PLC, you can claim tax relief on any pensions contributions you make through the limited company structure. This means your overall income retention percentage will significantly increase.
Our Contractor Pension and Protection team, CWM Wealth Management, are on hand to assist and will provide you with a free personalised advice on the various plans available. Your Dedicated Account Manager will be happy to make an appointment for you.
Give Us a Call Today
Becoming a Contractor has never been easier. If you’re interested in Contracting and you have never Contracting before, we would be happy to answer any of your queries! Give us a call on 01 6110707 and speak to one of our qualified Contracting Consultants or book a call HERE.
Contracting PLUS – Making Contracting Simple